Delaware is a popular choice for businesses of all sizes because it doesn’t have sales tax and offers a business-friendly environment. Notably, about 67.6% of Fortune 500 companies have chosen Delaware as their headquarters. But it’s not just the big players—many LLCs also start here, attracted by the state’s business climate.
To start a Delaware LLC, you must follow several steps. These steps ensure that your LLC is registered correctly and follows state regulations. Here’s a breakdown of the process:
Step#1: Name your Delaware LLC
Step#2: Pick a Delaware LLC Resident Agent
Step#3. Submit your Delaware Certificate of Organization
Step#4: Get a Certificate From The State
Step#5: Create an Operating Delaware LLC Agreement
Step#6: Obtain an Employer Identification Number
Step#7: Meet Other Tax and Legal Rules
Step #1: Name your Delaware LLC
In Delaware, when you’re starting your own business, an LLC name needs to have “Limited Liability Company” or “L.L.C.” or “LLC” in it. It can also include members’ names or words like “Club,” “Foundation,” “Fund,” “Institute,” “Society,” “Union,” “Syndicate,” or “Trust.”
Your LLC’s name should differ from other businesses’ already on file with the Delaware Secretary of State. You can check if a name is available by searching the Division of Corporations business name database.
Reserve Your Delaware LLC Name:
If a name is free, you can keep it for 120 days by paying $75. You can do this online on the Delaware Division of Corporations website or print out the Application for Reservation company name and send it by mail.
Additional Consideration: Make sure the website address (URL) you want is available. Even if you need to make a website, getting your domain name is wise. Check if it’s free before you decide on your LLC name.
Step #2: Pick a Resident Agent
The next step in creating a Delaware LLC is picking someone or a company to be your registered agent. A registered agent gets legal papers for your LLC, such as official documents and notices.
You or another member can be the registered agent and use a registered agent service to act as your agent. The service typically costs between $49 and $300 a year, so research before hiring to get a service that keeps your LLC in good shape. You can find a list of Delaware registered agents on the Secretary of State’s website.
Step #3: Submit your Delaware Certificate of Organization
To start your Delaware LLC, you must complete a form called “certificate of formation” or “articles of organization,” the required fee is $90.
You can either upload your document online or mail it in at
Delaware Division of Corporations
401 Federal Street — Suite 4
Dover, DE 19901
A certificate of organization outlines your business’s status and includes essential details such as your LLC’s name, the registered agent’s particulars, and the individual completing the form. Additionally, a cover page is available to include any special restrictions, allowing LLCs to enhance their protections if necessary.
Foreign LLCs Operating in Delaware
If your company is from another state and wants to do business in Delaware, you must fill out a Certificate of Registration form and pay $200. You must also provide a Certificate of Existence from your company’s home state, which should be at least six months old.
Step #4: Get a Certificate From the State
Once the state approves your LLC’s paperwork, it will provide a certificate confirming its establishment. This certificate allows you to acquire an Employer Identification Number (EIN), business licenses, and a bank account.
Step#5: Create an Operating Delaware LLC Agreement
Starting an LLC is a big deal, and in Delaware, if your company has more than one person, you need to create an operating agreement. You don’t have to send it to the state, but when you register your company, you agree to have one that sets the rules for your business. Even if you’re the only one in your LLC, having an operating agreement is essential.
This agreement is a document that outlines the operational procedures of your LLC and defines each member’s role within the organization. Additionally, it establishes the separation between your business assets and personal property, offering protection for your personal belongings in case of any issues arising within the company.
The operating agreement contains these details:
- What each member does
- How is the LLC run by members or managers
- Adding new members
- Transferring membership
- Daily business tasks
- Financial practices
Step# 6: Obtain an Employer Identification Number
When starting an LLC in Delaware, you must obtain an Employer Identification Number (EIN). The Internal Revenue Service (IRS) provides this number, which helps you separate your business and personal finances. It’s a nine-digit number used primarily for tax purposes, but you may also need it for other business activities such as:
- Hiring people,
- Opening a business bank account
- Working with suppliers
- Getting a business loan
Even if you’re the only one in your LLC, getting an EIN is advisable. It’s free, quick, and easy to apply online. Once you apply, you’ll receive your Delaware LLC EIN Number right away. The state will also give you a 7-digit number for state taxes and other LLC matters.
Step #7: Meet Other Tax and Legal Rules
Depending on your business and where you operate, you might have to register for state and local taxes, such as sales tax or unemployment insurance tax. Some companies also need special licenses to operate legally.
If you have a Delaware LLC, you’ll have to pay a yearly tax called the alternative entity tax, which is $300 and is usually due by June 1 each year.
Use this guide to start an LLC in Delaware and get your business up and running fast. Knowing these steps can make creating your LLC in Delaware easier and get it going.
LLC State Guides
FAQs About How To Start an LLC in Delaware
How much does it cost to start an LLC in Delaware?
To start, you’ll need to pay $110 for a Certificate of Formation. If you want a certified copy, it’s an extra $50. For faster processing, you can pay an additional $50 for 24-hour service or $100 for same-day processing. You’ll also need a state business license, which costs $75 per year for the first location and $25 for each additional location.
Do Delaware LLCs have to pay taxes?
Yes. Every year, in-state and out-of-state LLCs must give the state $300.
Do I need to get a DBA for my LLC?
Yes, Companies must obtain a “doing business as” (DBA) designation to operate under a different name within each county.
How quickly can I get an LLC in Delaware?
Forming an LLC in Delaware takes 2-3 weeks online (or 3-4 weeks by mail).
