How much does an LLC cost in Delaware? (details)
Forming a Delaware LLC entails more than just paying the first filing fee; it doesn't have to be extremely expensive.
We outline all up-front and continuing costs for a Delaware LLC and advise how to cut these out of the budget successfully.
How Much Does It Cost to Start an LLC in Delaware?
There is a $90 filing fee for the Certificate of Formation with the Division of Corporations when forming an LLC in Delaware.
This is an important step in creating your LLC's legal standing, which will allow it to function under Delaware's regulations if approved.
Apart from the LLC filing fee mentioned above, additional expenses are associated with establishing a Delaware LLC (Limited Liability Company).
Costs of Forming a Delaware LLC
Forming a Delaware LLC includes a one-time state filing fee of $90.
Ongoing fees such as a $300 Annual Franchise Tax fee, as detailed below.
LLC Costs in Delaware
| Requirement | Cost |
|---|---|
| LLC Name Reservation | $0 |
| Registered Agent | $0 or $125 per year |
| Certificate of Formation | $90 |
| Operating Agreement | $0 (free on our site) |
| EIN Number | $0 (free through IRS) |
| Business License | $70 (minimum) |
| Annual Franchise Tax | $300 |
| Taxes | varies (filed and/or paid every year) |
The filing fee for a Delaware LLC Certificate of Formation is $90
In Delaware, forming an LLC requires paying the Division of Corporations a $90 filing fee for the Delaware Certificate of Formation. This paper creates your LLC legally if it is accepted.
After formation, you only need to pay the $90 one-time charge; after that, you won't need to pay any more monthly or yearly fees to keep your Delaware LLC active.
✎ Note:
LLCs represent the predominant business structure in Delaware, chosen for their robust liability protection afforded to owners, making them highly favored among business entities.
The form used to establish an LLC can vary by state; it may be referred to as the Certificate of Formation.
In Delaware, it is specifically known as the Certificate of Formation. Despite these variations in naming, they all serve the same purpose to legally create your LLC.
Reserving a business name in Delaware entails a fee of $0
Naming your Limited Liability Company in Delaware is free of charge. Your Delaware LLC name is approved without additional fees when your Certificate of Formation filing is accepted by the state.
Contrary to online information, most states, including Delaware, do not mandate LLC Name Reservations for formation. In Delaware, you can simply specify your desired LLC name directly in the Certificate of Formation form without needing a separate reservation.
How much does a DBA cost? ($25)
In Delaware, filing a DBA with the State online costs $25.
✎ Note:
A DBA, also known as a Trade Name, Fictitious Name, Assumed Name, or Fictitious Business Name, refers to the same concept.
★ Tip:
Obtaining a DBA for your LLC is optional and not a requirement.
Delaware Registered Agent Fee ($0 to $125/ annually)
Under Delaware law, every LLC formation requires the appointment of a Registered Agent.
Your Delaware Registered Agent acts as the liaison for legal documents and state notifications on behalf of your LLC, necessitating a physical address within the state and availability during regular business hours.
You can appoint yourself, a trusted associate, or a family member as your Registered Agent without incurring additional expenses.
Alternatively, hiring a Registered Agent service costs between $100 and $300 per year. These services offer additional business support and safeguard your privacy.
Hiring a Registered Agent service is a good idea if:
- You lack a physical address in the state (Delaware law mandates Registered Agents to have an address within the state).
- You prefer to keep your address private (some companies allow you to use their address for confidentiality).
Exclusive Offer!
Hire a Northwest Registered Agent to form your LLC for just $39 plus the state fee and receive a free year of Registered Agent service.
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LLC Operating Agreement Fee ($0)
A Delaware LLC Operating Agreement functions as a written contract among the LLC's members. It outlines specific details regarding ownership, how the LLC is managed, and the distribution of profits.
Both Single-Member and Multi-Member LLCs should create an Operating Agreement, maintain it within their business records, and provide each member with a copy.
Online services generally charge between $50 and $200 for crafting an LLC Operating Agreement.
LLC EIN Number Fee ($0)
An EIN, also referred to as an Employer Identification Number or FEIN (Federal Employer Identification Number), is essential for handling tax filings, setting up an LLC bank account, and potentially facilitating employee hiring.
While some platforms may charge a fee, you can obtain an EIN for your LLC free of charge directly from the IRS. The process to apply online is simple and typically takes only a few minutes to complete.
Delaware LLC Annual Franchise Tax Report Fee ($300/year)
Delaware requires LLCs to keep their information current by filing an Annual Franchise Tax report.
This ensures your Delaware LLC maintains good standing and complies with state regulations, enabling it to sustain its operations. You verify the details on the Annual Franchise Tax, submit it to the Delaware Division of Corporations, and pay the required fee for the Annual Franchise Tax report.
The Annual Franchise Tax for a Delaware LLC amounts to $300 per year. This fee is paid annually for as long as your LLC is active.
Delaware Business License ($75 per year)
Before launching operations in Delaware, every LLC must obtain a Business License from the Division of Business Licensing. This process involves paying an initial filing fee of $75, which is an essential cost for Delaware LLCs.
Your Delaware LLC Business License must be renewed annually, with a renewal fee of $75 payable each year throughout the life of your LLC.
Delaware Business License and Permit Fees
The locations and industry sectors in which your LLC operates in Delaware may require you to apply for additional business licenses or permits. For your LLC's specific operating area, for example, it may be necessary to obtain a city business permit.
Location and industry specifics can affect the cost of these licenses or permits. These costs are usually fair. Local governments such as towns, cities, or counties are responsible for administering some licenses and permits, while the state issues others.
LLC Taxes
Delaware LLC owners face a range of tax obligations, leading to varying annual costs.
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)
The Taxes of Your Delaware LLC taxes are affected by your industry and business activities, making it difficult to predict. Every business is different, and the taxes your LLC owes depend on your specific situation.
✎ Note:
Typically, a Single-Member LLC is taxed similarly to a Sole Proprietorship, while a Multi-Member LLC is taxed similarly to a Partnership.
Hiring an Accountant
Accounting fees can vary, but in general, expect to pay about $300 a year for basic tax returns and up to $900 for more comprehensive filings.
The best person to help you determine your small business tax liability in Delaware is a certified accountant.
While accounting costs can vary, you should generally budget $300 for simple tax returns and up to $900 for more complicated filings annually.
Need to save time?
Consider hiring a professional to set up your LLC: Northwest Registered Agent offers LLC formation services starting at $39 plus the state fee.
(Find out why Northwest is the top choice for LLC formation)
✎ Note:
Accounting fees can vary, but in general, expect to pay about $300 a year for basic tax returns and up to $900 for more comprehensive filings. We recommend speaking with a few Delaware accountants to make sure they can help you with all of your local, state, and federal tax needs. For more advice, see our comprehensive guide on how to find an accountant.
Delaware Department of Corporations
If you have questions about the costs involved in starting a Delaware LLC, feel free to contact the Delaware Department of Corporations.
Delaware LLC Costs FAQs
How much does it cost to open an LLC in Delaware?
It costs $90 for Delaware LLC formation. This is a one-time filing fee for the LLC Certificate of Formation.
How much does an LLC in Delaware cost per year?
All Delaware Limited Liability Companies need to pay $300 per year for the Franchise Tax and $75 per year for the State Business License. The Franchise Tax and Business License fees are paid to the Department of Revenue. These are the only state-required annual fees to keep your LLC in good standing.
Should I hire an LLC formation service?
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.
Do I need to hire an attorney to form an LLC?
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.
How do I start an LLC in Delaware?
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 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
What’s the cheapest way to start an LLC?
You can get an LLC cheaply by filing your formation documents yourself. You’ll also save money by being your Registered Agent and using our free LLC Operating Agreement template. By forming your LLC yourself, being your Registered Agent, and using our Operating Agreement template, you can save over $400.
How long does it take to get an LLC in Delaware?
You can get an LLC in Delaware approved in 10 business days if you file online. Filing by mail takes about 10 business days (plus mail time).
How much does a Delaware business bank account cost?
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.
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.
How much is a Foreign LLC in Delaware?
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. That’s the fee to register your LLC in Delaware after it was formed somewhere else.
Is Delaware a good state for an LLC?
Yes, Delaware is a great state to start a business. Delaware doesn’t charge a state business license fee, has quick approval times, and has 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. If you live in or do business in Delaware, then you should start your business in Delaware. Forming your LLC in another state may lead to more costs and complications.