Delaware LLC vs Wyoming LLC
Last updated July 2026
Delaware LLC
The default state for startups planning to raise venture capital
Advantages
- Investor-friendly, most VCs prefer or require Delaware entities
- Chancery Court is the most sophisticated business court in the U.S.
- Well-established body of business law, fewer legal surprises
- No public disclosure of LLC members
Drawbacks
- Annual franchise tax of $300 flat (LLCs), higher than Wyoming's $60
- Registered agent required if you don't live in Delaware ($50-$300/yr)
- Must also register as a foreign LLC in your home state if you operate elsewhere, double fees
- Filing fee of $90 (higher than Wyoming's $100 comparable)
Wyoming LLC
The privacy-focused state with the lowest ongoing fees
Advantages
- $60 minimum annual report fee, lowest among LLC-friendly states
- Strong privacy: LLC members are not disclosed on public state filings
- No state income tax on LLCs (federal still applies)
- Strong charging order protection for single-member LLCs
- Formation fee of $100
Drawbacks
- Not investor-friendly, most VCs will require conversion to a Delaware C-corp anyway
- Must still foreign-qualify in your home state if you operate there
- Wyoming courts have less business-law precedent than Delaware Chancery
Delaware and Wyoming are the two most-referenced states for forming an LLC outside your home state. Delaware is the standard for startups planning to raise venture capital. Wyoming is the standard for solopreneurs prioritizing privacy and low fees. Choosing wrong means paying franchise tax in both your home state and your formation state.
Feature Comparison
| Feature | Delaware LLC | Wyoming LLC |
|---|---|---|
| Filing Fee | $90 initial filing | $100 initial filing |
| Annual Fee | $300 flat franchise tax | $60 minimum annual report fee |
| Privacy Level | Members not disclosed on public filings | Members not disclosed on public filings |
| Court System | Chancery Court, most sophisticated business court in U.S. | Standard state courts |
| VC-Friendly | Yes, standard for venture-backed startups | No, VCs typically require Delaware conversion |
| Foreign Qualification | Required in your home state if operating there | Required in home state if operating there |
| Asset Protection | Standard LLC protections | Strong charging order protection for single-member LLCs |
| Typical Annual Cost | About $500-$700/yr including registered agent + tax | About $200-$400/yr including registered agent + fee |
Too Close to Call
Choose Delaware if you're raising VC. Choose Wyoming if you're a solo operator or holding company that values privacy and low fees.
Neither wins outright, the correct choice depends entirely on your business. If you'll raise venture capital, Delaware is functionally mandatory (VCs won't fund non-Delaware entities without conversion). If you're a solo operator, freelancer, or holding real estate in an LLC, Wyoming is $240+/yr cheaper and offers equivalent privacy. Most operators should actually form in their home state, foreign qualification fees eat any Wyoming or Delaware savings unless you're a genuine multi-state operation.
Related Comparisons
Delaware LLC vs Nevada LLC
Two out-of-state formation favorites, VC-friendly Delaware or asset-protection-focused Nevada, which fits?
Wyoming LLC vs Nevada LLC
Two asset-protection-friendly states, which one has lower fees and better privacy?
Delaware LLC vs Florida LLC
The VC-friendly formation state meets the no-state-income-tax Sun Belt home state, which fits?