Form a Delaware LLC as a Non-Resident (Guide)

If you’re a non-US looking to start your own business in the US, Delaware is a great place to start. As one of the most business-friendly states in the country, Delaware offers several benefits for entrepreneurs, including low taxes, flexible regulations, and a streamlined registration process.

In this guide, I’ll explain everything you need to know to start a Delaware LLC as a non-resident.

Delaware LLC Non-resident Requirements

If you are a non-resident and want to start a Delaware LLC, you must fulfill a few requirements.

I explained these requirements below:

Registered Agent

As a non-resident, you must designate a registered agent with a physical address in Delaware.

The registered agent will serve as your LLC’s official point of contact for legal and administrative purposes, including receiving legal documents, service of process, and official correspondence on behalf of the company.

You can hire a registered agent service to fulfill this requirement. Many registered agent services are available online, such as Northwest Registered Agent.

Certificate of Formation

You must file a Certificate of Formation with the Delaware Division of Corporations to form your Delaware LLC. The Certificate of Formation is a legal document that officially creates your LLC and includes basic information about your business, such as its name, address, and registered agent.

You can file the Certificate of Formation online through the Delaware Division of Corporations website. Alternatively, you can hire a formation service to file the Certificate of Formation.

Here’s their Mailing Address if you wish to do it yourself:

Delaware Division of Corporations
401 Federal Street – Suite 4
Dover, DE 19901

Operating Agreement

While not required by Delaware law, creating an Operating Agreement for your LLC is highly recommended. An Operating Agreement is a legal document that outlines your LLC’s ownership and management structure, as well as the rights and responsibilities of its members.

You can create an Operating Agreement using a template or hire a lawyer to draft one.

Employer Identification Number (EIN)

An Employer Identification Number (EIN) is a unique nine-digit number the IRS assigns to identify your LLC for tax purposes. As a non-resident, you must obtain an EIN to hire employees or open a bank account in the United States.

You can obtain an EIN for your LLC by applying online through the IRS website. Alternatively, you can hire a formation service or an accountant to obtain an EIN on your behalf.

Steps on How to Register an LLC in Delaware as a Non-resident

Step 1. Selecting Your Business Name (new or existing)

First, I would search for the name on the Delaware Division of Corporations website. Selecting a business name is the first step in registering your LLC in Delaware.

You can choose a new or existing name if you already have a business.

Check if the name is available and has not already been taken by another business in Delaware.

Step 2. Appointing a Delaware Registered Agent (I use Northwest)

All LLCs in Delaware, including non-resident LLCs, must appoint a registered agent with a physical address.

The registered agent serves as the LLC’s official point of contact for legal and administrative purposes, including receiving legal documents, service of process, and official correspondence on behalf of the company.

I recommend using Northwest Registered Agent as your registered agent service provider.

Read about my experience with Northwest Agent in this review.

You can also get started with them for as little as $39; Northwest Registered Agent offers comprehensive services that include registered agent representation and business formation assistance tailored to your needs.

Step 3. Sign up For Northwest Registered Agent

To sign up for Northwest Registered Agent services, go to their website and click on the “LET’S GET YOU STARTED” button.

Choose your business entity as LLC and select Delaware (of course!) as your preferred state.

Step 4. Enter Your New/Existing Company Details

After selecting your business entity and state, you must enter your new or existing details. This includes your name, address, and other essential information. You can choose the physical and mailing addresses you want for the business.

If unsure about your business purpose, toggle “Use Generic Business Purpose.”

Step 5. Enter The Management For Your LLC

You’ll also need to enter the management for your LLC. This includes the members or managers who will run your business. If your business is a one-person show, just stick with one member and use your name.

Step 6. Fill in Your Contact Details

Next, you’ll need to fill in your contact details, including your email address, phone number, and other information.

Step 7. Setup Your Account with Northwest Registered Agent

After entering all your information, you must set up your account with Northwest Registered Agent using your email and preferred password. This will allow you to access their services and complete the following steps to form your Delaware LLC.

Step 8. Get Your Business Identity (Optional)

You can toggle this on to add the Northwest Business Identity option for your LLC.

It includes the following, free for 90 days:

• Domain name registration – 1 Free Year
• Website – hosted by us, owned by you
• Business email address
• Business phone

Step 9. Getting Your Tax ID or EIN – optional

If you want your LLC’s tax ID (EIN), you can do so through Northwest Registered Agent. They will help you complete and submit the necessary forms to the IRS. It’s pretty easy to get this on your own, but if you’d like to include it in your order, that’s also great!

Just toggle on the “Tax ID” and select “Do NOT Have Social Security Number“.

Step 10. Checkout/Payment (Congratulations!)

Finally, you’ll need to check and make payment to complete the process of forming your Delaware LLC.

Once you’ve done this, congratulations! You can now open a Stripe account and start.

Enter your valid card information, then click Done!

Also read: Top 10 Recommended LLC Services for Foreign Business Owners

Delaware LLC Non-Resident Benefits

Delaware is a top choice for non-resident business owners when forming an LLC.

Here are some of the benefits of creating an LLC in Delaware:

• Strong Legal Protections: Delaware offers a well-established and business-friendly legal framework, mainly through the Delaware Court of Chancery, specializing in business law. This ensures a reliable environment for resolving disputes efficiently.
• No State Income Tax for Out-of-State Operations: Delaware exempts LLCs from state income tax if they do not conduct business within the state. This provides significant tax savings for non-resident business owners operating outside Delaware.
• Privacy Protection: Delaware allows LLCs to be formed with minimal disclosure of personal information, safeguarding the privacy of members or managers. This ensures confidentiality and protects against potential misuse of personal data.
• Flexible Business Structure: Delaware LLCs offer management and operational arrangements flexibility through customizable operating agreements. This accommodates diverse business preferences and operational needs for non-resident owners.
• Easy and Quick Formation Process: Delaware offers a streamlined and efficient process for LLC formation, ensuring businesses can be established promptly—this quick turnaround benefits non-resident owners looking to start operations without delays.
• Well-Established Business Infrastructure: Delaware boasts a robust business ecosystem with experienced legal, financial, and support professionals. This infrastructure supports non-resident owners with expert advice, services, and networking opportunities critical for business success.

How Much Does it Cost in Total to Form an LLC in Delaware as a Foreigner?

The total cost of forming an LLC in Delaware as a non-resident includes the state filing fee, registered agent fee, and any additional services you choose.

The state filing fee is $110, and the registered agent fee is $125 per year. If you use Northwest Registered Agent, the initial cost to form your non-resident LLC is $174 (excluding an EIN/Tax ID). If you opt for an EIN, the total cost is $374, with the EIN service being a one-time fee.

Delaware LLC Taxation/Taxes for Non-US Residents – How Does it Work?

As a non-U.S. resident, you may wonder about the tax implications of starting a Delaware LLC. The good news is that Delaware does not tax out-of-state income, which makes it an attractive option for non-resident business owners.

Here’s what you need to know about Delaware LLC taxation for non-US residents:

As a non-US resident, your Delaware LLC will only be taxed in the US on income from US sources. This means that we will not tax income from other countries. However, any profits from US-sourced income will be taxed by 30%.

All Delaware LLCs must file an annual report with the Delaware Division of Corporations. This report is due on or before March 1st of each year. The annual report fee is $300.

To maintain compliance with Delaware law, your LLC must also pay an annual franchise tax. The amount of the tax is based on the number of authorized shares your LLC has. The minimum tax is $175, and the maximum is $200,000.

Starting a Delaware LLC as a non-US resident can be a smart business move, thanks to Delaware’s favorable tax laws. While there are some tax requirements and compliance obligations to keep in mind, the benefits of forming a Delaware LLC can outweigh the costs.

Related: Which State is Best for LLCs for Foreigners?

What’s The Best Bank for Non-US-residents?

When starting a Delaware LLC as a non-resident, choosing the right bank is crucial for managing your finances and ensuring smooth business operations. While several options are available, Mercury is the best bank for non-US residents.

Mercury is an online-only bank offering various features and benefits catering to non-US residents.

Some of the key advantages of using Mercury include:

• Easy account opening process: You can open a Mercury account in just a few minutes without needing a US address or social security number.
• No monthly fees: Mercury doesn’t charge any monthly fees for their accounts, making it an affordable option for non-US residents.
• Free wire transfers: Mercury allows you to send and receive wire transfers for free, which is particularly useful for international business transactions.
• Integration with other tools: Mercury integrates with various tools and services, such as QuickBooks and Stripe, making it easy to manage your finances and payments from one place.

Other notable mentions of the best bank for non-US residents include Wise, Relay, and BlueVine. Wise offers a wide range of currencies and low fees for international transfers, while Relay provides a virtual office address and mail forwarding service. BlueVine is a good option for those seeking a business checking account with no monthly fees.

Frequently Asked Questions

Can a non-resident open an LLC in Delaware?

Yes, a non-resident can open an LLC in Delaware. Delaware is among the most popular states for LLC formation due to its favorable business laws and taxation policies.

What are the steps for a non-resident to establish an LLC in Delaware?

To establish an LLC in Delaware as a non-resident, you will need to follow these steps:

1. Choose a unique name for your LLC
2. Appoint a Registered Agent in Delaware
3. File a Certificate of Formation with the Delaware Division of Corporations
4. Obtain an Employer Identification Number (EIN) from the IRS
5. Comply with any additional state and federal regulations

Can I use a registered agent for my Delaware LLC registration as a non-resident?

As a non-resident, you must appoint a Registered Agent in Delaware. A Registered Agent is responsible for receiving legal and tax documents for your LLC.

What are the annual costs associated with maintaining a Delaware LLC for non-residents?

Delaware charges $110 to start an LLC, $75 to get a business license, and an annual franchise tax of $300. In addition, there are some optional expenses to consider, like hiring a registered agent or ordering certified copies. 

Is a physical presence required in Delaware to form an LLC as a non-resident?

No, a physical presence is not required in Delaware to form an LLC as a non-resident. However, you must appoint a Registered Agent in Delaware to receive legal and tax documents for your LLC.

What’s the best method to open a Delaware LLC non-resident bank account?

One of the best methods to open a Delaware LLC non-resident bank account is to use online banking services such as Mercury. These services offer easy account opening and management and low fees.

What are the best states to form an LLC as a non-resident?

New Mexico, Wyoming, Delaware, and Nevada are often considered the best states to form an LLC as a non-resident due to their favorable tax laws and business-friendly regulations.

Can a non-resident Delaware LLC owner hire employees in the US?

Yes, a non-resident Delaware LLC owner can hire employees in the US. However, the LLC must comply with all state and federal employment laws and regulations.