Starting an LLC in Delaware comes with more costs than just filing the initial paperwork. But it doesn’t have to be as expensive as you think.
We explain all of the initial and ongoing Delaware LLC costs below, as well as give you tips on how to save money.
How much does an LLC cost in Delaware?
It costs $90 to form an LLC in Delaware. This is a fee paid for the Certificate of Formation.
You’ll file this form with the Delaware Division of Corporations. And once approved, your LLC will go into existence.
In addition to this LLC filing fee, there are other costs to be aware of when forming a Delaware LLC (Limited Liability Company).
Costs to forming a Delaware LLC
There is a $90 one-time state filing fee to form a Delaware LLC.
There are also ongoing fees (like a $300 Annual Franchise Tax fee), which we discuss below.
LLC Costs in Delaware
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Delaware LLC Certificate of Formation Filing Fee ($90)
Starting an LLC costs $90 in Delaware. This is the state filing fee for a document called the Delaware Certificate of Formation.
The Certificate of Formation is filed with the Delaware Division of Corporations. And once approved, this is what creates your LLC.
The $90 fee is a one-time fee. You don’t have to pay any monthly (or annual) fees to start your Delaware LLC.
Note: LLCs are the most common business structure used in Delaware. They are the most popular business entity because they offer liability protection for the LLC owners.
Depending on the state, the Certificate of Formation form is sometimes called a Certificate of Organization or Certificate of Formation. Certificate of Formation is the most common name – but they all mean the same thing: the form used to create your LLC.
Delaware business name cost ($0)
Naming your Limited Liability Company doesn’t cost anything. Your Delaware LLC Name is approved (at no extra cost) when your Certificate of Formation filing is approved by the state.
You may have read online that LLC Name Reservations are required. However, this is not true in most states. Most states don’t require a Name Reservation to form an LLC.
How much does a DBA cost? ($25)
A DBA is filed with each county in Delaware where your LLC does business. Each DBA filing costs $25.
Note: A DBA is sometimes called a Trade Name, Fictitious Name, Assumed Name or Fictitious Business Name. They all mean the same thing.
Tip: You aren’t required to get a DBA for your LLC. It’s optional. For more information, read our article: Do I need a DBA?
Delaware Registered Agent Fee ($0 or $125/year)
Delaware law requires that you designate a Registered Agent when forming your LLC.
A Delaware Registered Agent is a person or company who receives legal documents and state notices for your LLC. A Registered Agent needs a street address in the state and should generally be available during normal business hours.
There is no additional cost if you will be your own Registered Agent, or have someone you know be your LLC’s Registered Agent.
However, you have the option of hiring a Registered Agent service. This will cost you between $100 to $300 per year. But Registered Agent service companies offer other helpful business services and can protect your privacy.
Hiring a Registered Agent service is a good idea if:
- You don’t have an address in the state (Delaware law requires Registered Agents to have a physical address in the state
- You want to keep your address off public record (depending on which company you hire, you may be able to use their address to keep your address private)
LLC Operating Agreement Fee ($0)
A Delaware LLC Operating Agreement is a written contract between the LLC Members. Operating Agreements include detailed information about LLC ownership, how the LLC is managed, and how profits are distributed.
Single-Member LLCs and Multi-Member LLCs should draft an Operating Agreement, keep it with their business records, and give a copy to each Member.
Most websites charge $50 to $200 for LLC Operating Agreements.
Here at LLC University®, we offer free LLC Operating Agreement templates for all types of LLCs.
LLC EIN Number Fee ($0)
An EIN Number is also known as an Employer Identification Number (EIN) or a Federal Employer Identification Number (FEIN).
This number is used to file income taxes, to open an LLC bank account, and to hire employees (if applicable).
Although many websites charge a service fee to get an EIN for your LLC, it can actually be done for free.
You can obtain an EIN for your LLC from the Internal Revenue Service (IRS) at no cost. The online filing can be completed in a few minutes.
Delaware LLC Annual Franchise Tax Fee ($300/year)
Delaware requires you to keep your LLC’s information up to date by filing an Annual Franchise Tax.
This keeps your Delaware LLC in good standing and in compliance with state law so it can continue operating. You simply confirm the information on the Annual Franchise Tax, file it with the Delaware Division of Corporations, and pay the Annual Franchise Tax fee.
The Delaware LLC Annual Franchise Tax costs $300 per year. This fee is paid every year for the life of your LLC.
Delaware Business License and Permit Fees (varies)
Delaware Business License ($75)
All Delaware LLCs must get a Business License from the Division of Revenue. The filing fee is $75.
This state-level business license is required for all LLCs in Delaware. It is renewed every year (and the renewal fee is $75).
Other Delaware Business Licenses & Permits
Depending on where your LLC does business in Delaware and the industry you’re in, you may need to obtain additional Business Licenses or Permits. For example, you may need to get a County Business Permit.
The costs for these other business licenses or permits will vary depending on location and industry, but usually the fees are not very high. Some licenses and permits are issued at the state level, and others are issued by a municipality (the town, city, or county).
LLC Taxes (varies)
There are many different types of Delaware LLC taxes that owners must pay, so this annual cost varies widely.
Some of the taxes LLC owners pay include:
- Federal taxes
- State income tax
- Local income tax
- Business taxes
- Self-employment taxes
- Sales and use tax
- Payroll tax (if you have employees)
- Property tax (if the LLC owns property)
Your Delaware LLC taxes depend on your industry and amount of business activity, so we’re not able to provide an estimate. Every business is different, and your specific circumstances determine what taxes apply to your LLC.
Hiring an Accountant
How much your small business pays in taxes is best determined by working with a qualified accountant in Delaware.
The amount you’ll pay your accountant will vary. However, most accountants will charge $300 per year for a simple tax return, or up to $900 for more detailed filings.
Note: We recommend speaking with a few accountants in Delaware to make sure they can help you meet all of your federal, state, and local tax obligations. We offer detailed tips on How to Find an Accountant.
Delaware Division of Corporations
If you have any questions about the cost of opening a Delaware LLC, you can contact the Delaware Division of Corporations.
Delaware LLC Costs FAQs
It costs $90 to start a Delaware LLC. This is a one-time filing fee for the LLC Certificate of Formation.
Some LLCs may need a business license in Delaware. This depends on your industry and where your LLC is located. The cost of local business permits varies.
All Delaware LLCs need to pay $300 per year for the Annual Franchise Tax. These state fees are paid to the Division of Corporations. And this is the only state-required annual fee. You have to pay this to keep your LLC in good standing.
If you hired a Registered Agent service, you’ll have an annual subscription fee to pay each year. This is usually about $125 per year.
Some LLCs may need a business license in Delaware. This depends on your industry and where your LLC is located. You’ll need to check with your municipality to see if there are any annual renewal fees for the business permit.
You aren’t required to hire a professional service company to form your Delaware LLC. You’re allowed to form your LLC yourself if you’d like.
However, if you want to save time and make sure your LLC is filed correctly, we recommend hiring Northwest Registered Agent.
Northwest Registered Agent has excellent customer service and they include Registered Agent services free for the 1st year. They also offer other services, like an Operating Agreement and filing your Annual Franchise Tax.
Check out Best LLC Services for more suggestions.
No, you aren’t required to hire an attorney to form your LLC in Delaware. You’re allowed to form your LLC yourself if you’d like.
However, some people may want to hire an attorney if their LLC has a complex ownership or management structure, has investors, or requires industry-specific documentation.
A business attorney usually charges between $800 and $2,500 to form an LLC.
Here are the steps to starting an LLC in Delaware:
- Choose an LLC business name and make sure it’s available
- Choose who will be your Delaware Registered Agent
- File the Delaware Certificate of Formation
- Complete and sign an LLC Operating Agreement
- Get a Tax ID Number (EIN) from the IRS
- Open an LLC bank account
- Check whether you need a business or sales tax license in Delaware
You can get an LLC cheaply by filing your formation documents yourself. You’ll also save money by being your own Registered Agent, and using our free LLC Operating Agreement template.
By forming your LLC yourself, being your own Registered Agent, and using our Operating Agreement template you can save over $400.
How long it takes to get an LLC in Delaware depends on how you file your Certificate of Formation.
You can get an LLC in Delaware approved in 8-10 weeks if you file online. On the other hand, filing by mail takes about 8-10 weeks (plus mail time).
It varies. Some banks charge monthly fees ($10 to $20 per month), but these can sometimes be avoided by meeting certain requirements. For example, if you make a certain number of direct deposits or maintain a specified minimum balance, then they’ll waive the monthly fees.
And you might be able to find a bank that doesn’t charge any monthly fees.
Before you open your LLC business bank account, we recommend calling and asking if there are ways to avoid the monthly maintenance fees.
A Foreign LLC is an LLC formed in another state that must register (aka Foreign Qualify) in Delaware. This is because the LLC is doing business in both states.
The Delaware Foreign LLC cost is $200.
If you form an LLC in Delaware, it is called a “Domestic LLC”. If you formed your LLC in another state, it would be a Foreign LLC once you register it in Delaware.
Yes, Delaware is a great state to start a business. Delaware doesn’t charge a state business license fee, has quick approval times and helpful representatives at the Division of Corporations if you have questions.
However, the most important factors in deciding where to start a business are where you live and where you’re doing business.
Meaning, if you live in or do business in Delaware, then you should start your business 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. And just because a certain state has cheaper LLC fees doesn’t mean it’s a good idea to form your LLC there.
For example, if you form an LLC in Wyoming, but live in and conduct business in Delaware, you’ll also need to register your Wyoming LLC in Delaware (and pay fees). And you’ll end up paying Delaware taxes anyway. This ends up leading to more costs and more headaches with no advantages.
In summary, if you are a Delaware resident, then yes, Delaware is the best state to form an LLC. If you don’t live in and do business in Delaware, then no, Delaware probably isn’t a good state to start an LLC.