How to Start an LLC in Delaware

Written by: Mary Gerardine

Last updated:

A Delaware LLC is one of the most simple, cost-effective, and quick business structures to form. Even so, navigating the formation process can seem daunting without clear guidance and an actionable plan.

In this How to Start an LLC in Delaware guide, we’ll break down everything you need to know to form your LLC, from the steps you’ll need to take to get started to maintaining your business structure.

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Delaware LLC

In order to form a Delaware Limited Liability Company (LLC), you’ll need to complete the following steps:

  1. Name Your Delaware LLC
  2. Pick a Delaware Registered Agent
  3. Submit the Certificate of Formation
  4. Create a Delaware LLC Operating Agreement
  5. Get an EIN
  6. File Your BOI Report

In the sections below, we’ve broken down each of these steps in more detail.

Step 1: Name Your Delaware LLC

The first thing you’ll need to do before getting started is picking the right name for your LLC. This is important because your business’s name should represent your brand and create a good first impression.

In order to abide by statutory guidelines and be accepted by the Delaware Secretary of State, all LLC names must:

  • Contain either the term “Limited Liability Company” or a commonly accepted abbreviation of it
  • Be sufficiently distinguishable from the registered or reserved name of any domestic or foreign business entity organized under Delaware law
  • Reflect your business’s purpose and not mislead the public
  • Not include the word “bank”, unless regulated under the Bank Holding Company Act of 1956

For a more detailed look into all of the naming requirements that apply to LLC in Delaware, be sure to check out the Delaware Limited Liability Company Act.

Keep in mind that even though picking an LLC name in itself has no cost, there are certain fees that can be associated with the overall process.

Reserve an LLC Name

If you’re not yet ready to launch your business and still need a little more time, you can choose to reserve your desired LLC name for later by submitting an Application for Reservation of Limited Liability Company Name with the Secretary of State ($75 fee).

Reserving a name you plan to use will keep anyone from being able to take it for up to 120 days.

Before going ahead and reserving a name for your business, it’s a good idea to check if it’s actually available for use by performing an Entity Name Search on the Delaware Department of State’s website.

Register a DBA Name

Another potential cost associated with naming your LLC is the “doing business as” (or DBA) name — known as a trade name in Delaware. This is essentially a nickname that you can choose to register for your business to operate under — particularly if you’re not content with your LLC’s legal name.

Registering a DBA name can be done by filing a Registration of Trade, Business & Fictitious Name Certificate with the Prothonotary’s office and paying a $25 fee.

DBA filings in Delaware don’t expire, so you won’t need to renew this registration once you’ve submitted it.

Buy a Domain Name

Finally, you’ll want to focus on securing a good domain name (which is your website’s URL address) for your business. For this, try to focus on choosing one that’s easy for customers to remember, relevant to your business, and accurately reflects your brand.

After confirming the domain name you want to use is actually available, you can purchase it through a registrar like GoDaddy — this not only secures the name but also protects it from being used by others.

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Step 2: Pick a Registered Agent

The next step you’ll want to take toward forming your LLC is to pick a registered agent (RA). This is mandatory in order to be able to file your Certificate of Formation later on.

A registered agent is an individual or business entity that accepts legal correspondence on behalf of your business, such as service of process, notice of lawsuits, and official government communications.

Keep in mind that you’ll be required to continuously maintain one as long as your LLC is active.

In Delaware, any person or entity can act as a registered agent as long as they meet the following requirements:

  • Must have a physical address in Delaware
  • Must be present at this address throughout normal business hours to accept official communication
  • Must satisfy and adhere to Agency Regulations for individuals or entities.

You can even act as your own registered agent if you’re looking to save money — though we don’t typically recommend this as you’re much more likely to suffer fines and penalties due to non-compliance than if you just hire a professional service.

On top of this, you’ll lose any anonymity your LLC would have given you since your name, address, and contact information will appear on your Certificate of Formation (which is publicly available).

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If you’re ready to get started, you can form your LLC with Northwest Registered Agent and get a free registered agent service for your first year (normally costs $125).

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Note: To have a look at some of our other top recommendations, you can also check out our Best Registered Agent Service of 2024 guide.

Step 3: Submit Your Certificate of Formation

In Delaware, the Certificate of Formation is the filing document that you’ll need to submit with the Secretary of State in order to officially register your LLC (this is sometimes called the Articles of Organization in other states).

This can be done online, by mail, by fax, or in-person and will cost $90 for domestic entities, while foreign entities will have to pay $200 instead.

To complete your Certificate of Formation, you’ll need to have the following pieces of information on-hand:

  • The exact legal name of your LLC
  • The name and address of your LLC’s registered agent

In the sections below, we’ve broken down the primary ways of filing this document with the Delaware Secretary of State.

Online Filings

We generally recommend filing your Certificate of Formation online through the Delaware One Stop platform as it’s extremely quick and easy.

After creating an account and following the instructions, all you’ll need to do is download the Certificate of Formation (which should automatically be pre-filled for you), sign it, and then upload it to be filed.

Mail Filings

You’re also able to submit a paper application if you prefer, which can be done by downloading and filling out a Certificate of Formation by hand.

After this, you’ll need to mail the completed form, along with a check/money order for the relevant filing fee, to the following address:

Delaware Division of Corporations
401 Federal St.
Suite 4
Dover, DE 19901

Note: Regardless of how you file, you’ll also need to include a Certification Sheet alongside your Certificate of Formation, which is what will allow the Delaware Division of Corporations to get in touch with you if needed.

Step 4: Create a Delaware LLC Operating Agreement

Once this is completed, the next step you’ll need to take is to create an operating agreement.

This is an internal document that clearly outlines the ownership and management structure of a company in order to reduce potential future conflict and maintain smooth operations.

While this document isn’t legally mandated in Delaware, all limited liability companies are recommended to have one as it can help maintain both: smooth operations and your LLC’s corporate veil.

A number of companies provide drafting services for operating agreements online, typically for a fee of around a few hundred dollars. However, it’s quite easy to sort this out by yourself if you want to save money, and you can even find a number of free templates online to help with this.

Step 5: Get an EIN

Even though it’s not a legal requirement (unless your LLC has employees or multiple members), all Delaware LLCs will likely need to apply for an Employer Identification Number (EIN).

This is a free, nine-digit number used by the IRS to identify your business and keep track of its tax reporting — much like a Social Security Number (SSN) for individuals.

You’ll need an EIN to be able to:

  • Hire employees
  • Open a business bank account
  • Apply for some business licenses/permits
  • Establish a line of credit

On top of this, using an EIN instead of a Social Security Number (SSN) helps to protect your personal information and safeguard your anonymity as the business owner of your LLC.

You can quickly apply for an EIN for your LLC online through the IRS website. You’re also able to submit a paper application using Form SS-4 either via fax to (855) 641-6935, or by mailing it to the following address:

Internal Revenue Service
Attn: EIN Operation
Cincinnati, OH 45999

Note: Don’t worry if you don’t already have an SSN, it’s not necessary to have one in order to apply for an EIN — instead, you can just leave Section 7b of the application blank and call the IRS on (267) 941-1099.

Step 6: File a BOI Report

Starting January 2024, the vast majority of LLC owners will be required to file a Beneficial Ownership Information (BOI) Report with the US Financial Crimes Enforcement Network (FinCEN).

This is part of an initiative by the U.S. government to stop individuals and entities engaging in illegal or unethical activities from being able to conceal this using “opaque ownership structures”, like shell companies, to hide their true identities.

Existing LLCs will be able to file this report anytime between January 1, 2024, and January 1, 2025, while new LLCs will have up to 90 days after the date they were initially formed to do so (30 days for LLCs formed after the start of 2025).

Keep in mind that failure to file your LLC’s BOI report on time can result in exorbitantly high fines (i.e., $591 per day) or even jail time (up to two years).

Note: Not every LLC owner is required to file a BOI report. For example, companies with more than 20 full-time employees, accounting firms, and banks are exempt. For a full list of filing exemptions, you can have a look at FinCEN’s website.

How to Maintain Your Delaware LLC

In order to keep operating legally in the state of Delaware, your LLC will need to keep up with its Annual Franchise tax obligations — which we’ve discussed in greater detail below.

Annual Franchise Tax

In order to stay in good standing, all Delaware LLCs are required to pay an annual Franchise Tax of $300 by June 1 each year. This requirement is mandatory as long as your LLC remains active in the Delaware Division of Corporations’ records, irrespective of profitability.

To pay your LLC’s franchise tax, you’ll need to head over to the Delaware Corporations Information System (DCIS) website and enter your Business Entity File Number.

If you miss the June 1 payment deadline, your LLC will incur a penalty of $200, plus a mounting interest charge of 1.5% per month until you pay your tax bill.

Note: Regardless of how they’re structured, Delaware LLCs do not need to file annual reports with their Franchise Tax, unlike corporations.

Delaware vs Other States

Delaware is an extremely popular choice among LLC owners for a number of reasons, the most popular of these being its lenient taxes.

While it does impose a flat annual franchise tax, this is more than outweighed by the savings made due to the lack of sales tax, investment income taxes, or personal property taxes, and corporate income tax.

Combine this with the state’s fast incorporation process, set of reliable legal precedents, and a judicial system that’s geared towards businesses (thanks to its Court of Chancery, which is run by specialists in corporate law) and you have the ideal environment for forming and operating an LLC.

Having said that, keep in mind that the best state to form your LLC is almost always the state that you will be operating in; this is because otherwise you’ll likely be required to register as a foreign LLC in your home state, meaning that you’ll need to pay registration and maintenance fees twice.

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Delaware Secretary of State Contact Information

Mailing Address:

Delaware Department of State
Division of Corporations
PO Box 898
Dover, DE 19903

Physical Address:

Delaware Department of State
Division of Corporations
401 Federal Street, Suite 4
Dover, DE 19901
Monday – Friday, 8 a.m. to 4:30 p.m.

Contact Information:
Phone: (302) 739-3073

How to Start an LLC in Delaware FAQ

What is the advantage of having a Delaware LLC?

The primary advantage of having a Delaware LLC lies in the state’s favorable legal and tax environment for businesses. Its Court of Chancery specializes in business law, providing a predictable legal framework for resolving disputes.

Additionally, Delaware imposes no sales tax, personal property tax, or investment income tax, which can significantly reduce the overall tax burden of your LLC.

How much does a Delaware LLC cost?

It will cost at least $90 to form a domestic Delaware company and $200 to form a foreign LLC. However, this cost may vary depending on whether you decide to hire a professional registered agent and/or formation service.

For a more detailed breakdown of all the other expenses, check out our Delaware LLC Cost guide.

Why do so many LLCs register in Delaware?

Many LLCs register in Delaware due to its business-friendly laws, efficient legal system (even Delaware Supreme Court appeals can be expedited), and the anonymity provided by the Delaware Limited Liability Company Act.

Additionally, Delaware’s tax structure is advantageous, with no sales tax, investment income tax, or personal property tax.

Can I form an LLC in Delaware without living there?

Yes, you can form an LLC in Delaware without living there — it’s a very popular state among business owners both within the United States and even internationally due to its favorable business environment. However, you will need a registered agent based in the state.

Find out more about the rest of the requirements in our How to Start an LLC in Delaware guide.

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