Starting a Delaware LLC, step-by-step
Starting a Delaware LLC costs $90. And it takes 10 days to get an LLC in Delaware.
Here are the 6 steps to forming an LLC in Delaware:
- Choose an LLC Name
- Select a Registered Agent
- File a Certificate of Formation
- Create an Operating Agreement
- Get an EIN
- Get a Business License
If you want to form your LLC yourself, follow our free guide below.
If you want someone to take care of it for you, we recommend hiring Northwest Registered Agent
(We recommend Northwest. We've reviewed all the top companies in the industry. And Northwest is our #1 pick for prices, customer support, and address privacy. Check out Northwest vs LegalZoom to learn more.)
How much does it cost to start an LLC in Delaware?
It costs $90 to start an LLC in Delaware.
And then it costs $300 per year.
What are these fees for?
- The $90 is to file the Certificate of Formation – the document that creates an LLC.
- The $300 per year is for your Annual Franchise Tax Report – a mandatory filing that keeps your LLC in good standing.
To learn more about LLC Costs, see LLC Costs in Delaware.
How long does it take to get an LLC in Delaware?
If you file your LLC by mail, it will be approved in 10 business days (plus mail time).
But if you file online, your LLC will be approved in 10 business days.
Please see How long does it take to get an LLC in Delaware to check for any delays.
Here are the steps to forming an LLC in Delaware
1. Search your LLC Name
Search your Delaware LLC Name to make sure it’s available in the state.
You need to do this because two businesses in the state can’t have the same name.
First, search your business name and compare it to existing businesses in Delaware. You can make sure the LLC Name you want is unique from existing businesses using the Division of Corporations’ Name Availability Search.
Second, familiarize yourself with the naming rules in Delaware (so your Delaware LLC gets approved).
We’ll explain both in more detail here: Delaware LLC Name.
2. Choose a Delaware Registered Agent
The next step is to choose a Delaware Registered Agent.
A Delaware Registered Agent is a person or company who accepts legal mail and state notices on behalf of your Delaware Limited Liability Company.
Who can be an LLC Registered Agent?
You have 3 options for who can be the Registered Agent:
- A friend or family member
- A Registered Agent Service
Delaware requires LLC Registered Agents to have a physical street address in Delaware. PO Boxes aren’t allowed.
And the Registered Agent’s name and address will be listed on public records.
If you don’t have an address in Delaware, or you want more privacy, you can hire a Registered Agent Service for your LLC.
We recommend Northwest Registered Agent
Our favorite feature about Northwest is they’ll let you use their office address throughout your LLC filing. This way, you can keep your address off public records.
They’ll also scan any mail sent to your LLC and upload it to your online account.
Northwest has excellent customer service, and they’re who we trust to be our own Registered Agent.
3. File Delaware LLC Certificate of Formation
To start an LLC, you need to file the Delaware Certificate of Formation.
This gets filed with the Delaware Division of Corporations.
The Delaware Certificate of Formation costs $90 if you file online.
This is a one-time fee to create your LLC.
If you want to file this yourself, see our step-by-step guide: Delaware Certificate of Formation.
Or, you can hire a company to do it for you.
4. Create a Delaware LLC Operating Agreement
A Delaware LLC Operating Agreement serves as a “companion” document to the Certificate of Formation.
The Certificate of Formation creates your LLC, and the Operating Agreement shows who owns the LLC.
Additionally, some banks require an Operating Agreement when you open an LLC bank account.
And having an Operating Agreement will be very helpful if you ever end up in court. Reason being, it helps prove that your LLC is being run properly.
That’s why we recommend that all LLCs have an Operating Agreement – including Single-Member LLCs.
Furthermore, an Operating Agreement is an “internal document“. Meaning, you don’t need to file it with the state or the IRS (Internal Revenue Service). Just keep a copy with your business records.
You can download a free template below.
Then, learn how to fill it out by watching our step-by-step Delaware Operating Agreement video.
5. Get an EIN for your LLC
The next step is to get a Delaware EIN Number from the IRS for your LLC.
Note: An EIN Number is also called a Federal Tax ID Number or Federal Employer Identification Number.
An EIN Number is used to:
- identify your LLC for tax purposes
- open a business bank account
- apply for business licenses and permits
How much does an EIN cost?
Getting an EIN Number from the IRS is completely free.
How long does it take to get an EIN?
If you apply online, it takes 15 minutes.
If you apply by mail or fax, it can take 1-3 months.
How can I get an EIN?
US Citizens/US Residents: If you have an SSN or ITIN, you can apply for an EIN online. Follow these instructions: Apply for an EIN online.
Non-US Residents: You can’t get an EIN online, but you can still get one by fax or by mail. Follow these instructions: How to get an EIN without an SSN or ITIN.
6. Delaware business licenses and permits
All LLCs in Delaware are required to get a general business license from the Delaware Division of Corporations.
And depending on where your LLC is located, you may need a local business license or permit.
For example, if you want to start a daycare, you may need a business license from the city or county.
You can learn more on our Delaware LLC Business License page.
What do I do after my LLC is approved?
After your Delaware LLC is approved, there are some additional steps.
File your Delaware LLC Annual Franchise Tax Report
All Delaware LLCs must file an Annual Franchise Tax Report every year.
The Annual Franchise Tax Report keeps your LLC in good standing with the state.
How much does a Delaware LLC Annual Franchise Tax Report cost?
The Annual Franchise Tax filing fee is $300 per year.
When is the Annual Franchise Tax Report due?
Your report and filing fee are due every year by June 1st.
When is my first Annual Franchise Tax Report due?
Your first Annual Franchise Tax is due the year after your LLC was approved.
For example, if your LLC was approved on March 15, 2023, your first $300 Annual Franchise Tax is due by June 1, 2024.
How do I file my LLC Annual Franchise Tax Report?
The Annual Franchise Tax Report can only be filed online.
Follow our step-by-step guide here: Delaware LLC Annual Franchise Tax.
Open an LLC business bank account
You’ll want to open a business bank account for your LLC.
This makes accounting and record-keeping much easier for your business finances.
Having a separate business bank account also maintains your personal liability protection. This is because it keeps your business finances separate from your personal finances.
File and pay taxes
LLCs don’t pay federal income tax. Instead, the LLC Members pay the taxes for the LLC.
Said another way, the owners pay taxes for the LLC as a part of their personal tax return.
How will my LLC be taxed?
By default, a Delaware LLC is taxed by the IRS based on the number of owners your LLC has:
- A Single-Member LLC is taxed like a Sole Proprietorship.
- A Multi-Member LLC is taxed like a Partnership.
Alternatively, you can ask the IRS to tax your LLC like a C-Corporation or S-Corporation.
Besides federal taxes, there are also state and local income taxes – and gross receipts tax. Learn more in Delaware LLC Taxes.
How to Start an LLC in Delaware FAQs
Can I start an LLC online in Delaware?
Yes, you can file your LLC online in Delaware. The Certificate of Formation filing fee is $90.
When you submit your LLC formation documents online, your LLC will be approved in 10 business days.
What are the benefits of an LLC?
The first benefit of an LLC is protecting your personal assets. Meaning, if your business is sued, your personal assets – like your home, cars, and bank accounts – are protected.
This protection applies to all LLC owners (called LLC Members). It doesn’t matter if you have a Single-Member LLC or Multi-Member LLC. All of the LLC owners are protected from the business debts and liabilities.
This type of protection wouldn’t apply if you operate as a Sole Proprietorship or Partnership. With these types of informal business structures, the owners aren’t protected in the event of a lawsuit. For that reason, Limited Liability Companies (LLCs) are a much more popular business structure.
Another benefit is LLC pass-through taxation. This means the LLC itself doesn’t pay federal income taxes. Instead, the profits “pass through” to the LLC Members. And the Members pay the taxes on their personal tax return.
And Delaware state income taxes are very similar, since the state honors the federal tax treatment of your LLC.
To learn more, please see How are LLCs taxed.
Is Delaware a good state to start an LLC?
Whether Delaware is a good state to start an LLC depends on where you live – and where you’re doing business.
Meaning, if you live in or do business in Delaware, then you should start your LLC in Delaware. While many websites talk about tax rates and advantages of certain states, none of that applies if it’s not the state where you live and do business.
For example, if you form an LLC in Delaware, but live in and conduct business in Maryland, you’ll also need to register your Delaware LLC in Maryland (and pay extra fees). And you’ll end up paying Maryland taxes anyway. This ends up leading to more costs and more headaches with no advantages.
In summary, if you live in and conduct business in Delaware, then yes, Delaware is a good state to start a business. If you don’t live in and do business in Delaware, then no, Delaware isn’t a good state to start a business.
Real estate exception: If you’re purchasing real estate outside of Delaware, you should form your LLC in the state where the property is located.