How to Start an LLC in Delaware (Step-by-Step Guide)

Forming an LLC in Delaware requires filing a Certificate of Formation with the Delaware Division of Corporations and paying a $110 filing fee. The process takes about 10-15 business days for standard processing, with same-day and 24-hour expedited options available.

Follow these steps to start your Delaware LLC in 2026.

How to Start an LLC in Delaware (6 Steps)

Step 1: Name Your Delaware LLC

Your LLC name must be distinguishable from other business names registered in Delaware. The name must include “Limited Liability Company,” “LLC,” or “L.L.C.” as a designator.

Search the Delaware Division of Corporations entity search to check availability. This free search tool lets you verify that your desired name isn’t already taken by another registered entity in Delaware.

If you want to secure a name before filing, you can reserve it for 120 days by filing a Name Reservation request ($75 fee). Delaware’s name reservation fee is higher than most states, so only reserve if you truly need the extra time to prepare your formation documents.

Delaware naming rules:

• Must include an LLC designator (“Limited Liability Company,” “LLC,” or “L.L.C.”)
• Cannot be the same as or deceptively similar to an existing entity registered in Delaware
• Cannot include words suggesting it’s a bank, insurance, or trust company without proper authorization
• Cannot contain words implying it’s connected to a government agency
• Cannot use the word “university” or imply educational accreditation without approval

Tips for choosing a strong LLC name: Delaware is a popular state for LLC formation, so many common business names may already be taken. Search early and have backup options ready. Also consider checking if a matching domain name is available and searching the USPTO trademark database to avoid potential infringement issues.

Step 2: Choose a Registered Agent

Delaware requires every LLC to have a registered agent with a physical street address in Delaware. The registered agent receives legal documents and official correspondence on behalf of your LLC, including lawsuits, state notifications, and tax communications.

You have three options for your registered agent:

• Be your own registered agent: Free, but you must have a Delaware physical address (not a PO box) and be available during business hours. Your name and address become public record.
• Appoint an individual: They must be a Delaware resident with a physical address and available during business hours.
• Hire a professional registered agent service: Provides privacy, reliability, mail forwarding, and compliance alerts. Costs $39-$299/year.

Important: If you don’t live in Delaware (which is the case for most Delaware LLC filers), you’ll need a professional registered agent service. Delaware is one of the most popular states for out-of-state LLC formation, and a registered agent is required to maintain a physical presence in the state.

Our top recommendation is Northwest Registered Agent ($39/year), which also handles LLC formation for $39 + the $110 state fee. They provide a Delaware physical address, document scanning and forwarding, and compliance reminders.

Step 3: File Your Certificate of Formation

File your Certificate of Formation with the Delaware Division of Corporations. You can file online or by mail. Delaware’s Certificate of Formation is one of the simplest formation documents in the country — you only need to provide your LLC name, registered agent information, and organizer details.

Filing details:

• Filing fee: $110
• Online filing: Delaware Division of Corporations website
• Standard processing time: 10-15 business days

Expedited processing options:

• Same-day filing: additional $100 (total $210)
• 24-hour filing: additional $50 (total $160)

Information required on the Certificate of Formation:

• LLC name (with the LLC designator)
• Registered agent name and physical street address in Delaware
• Name and address of the organizer (the person filing the document)

That’s it. Delaware does not require you to list members, managers, a business purpose, or a principal office address in the Certificate of Formation. This simplicity and privacy is one reason Delaware is so popular for business formation — your members’ names and addresses are not part of the public record.

Step 4: Create an Operating Agreement

While Delaware law doesn’t strictly require a written operating agreement, having one is critically important — especially in Delaware. Delaware’s Court of Chancery, a specialized business court, gives significant weight to operating agreements when resolving business disputes. Without a clear operating agreement, you lose much of the flexibility that makes Delaware LLC law so attractive.

Delaware’s LLC Act provides extraordinary flexibility for structuring your operating agreement. You can customize nearly every aspect of how your LLC operates, which is one of the primary reasons businesses choose Delaware. Your operating agreement should cover:

• Member ownership percentages and capital contributions
• Voting rights and decision-making procedures
• How profits and losses are distributed among members
• Management structure and authority levels
• Procedures for admitting new members or handling departing members
• Transfer restrictions and buyout provisions
• Indemnification and liability provisions
• Dissolution procedures and winding up

Even single-member LLCs should create an operating agreement. Delaware courts look for evidence that you treat your LLC as a separate entity — an operating agreement is one of the strongest pieces of evidence. It’s also typically required by banks to open a business bank account.

Step 5: Get an EIN

Apply for an Employer Identification Number (EIN) through the IRS website. An EIN is your LLC’s federal tax identification number. The application is free and takes about 15 minutes online.

You need an EIN to:

• Open a business bank account (required by virtually all banks)
• Hire employees and process payroll
• File federal and state tax returns
• Apply for business credit cards and loans
• Comply with IRS reporting requirements

We recommend getting an EIN even if you’re a single-member LLC without employees. It protects your Social Security number from appearing on business documents.

Step 6: Pay Your Annual Franchise Tax

Delaware LLCs must pay an annual franchise tax of $300 to the Delaware Division of Corporations. This is a flat fee that applies to every LLC registered in Delaware, regardless of income, activity level, or whether the LLC actually conducts business in Delaware.

Franchise Tax details:

• Amount: $300 per year (flat fee for all LLCs)
• Due date: June 1 each year
• Late penalty: $200 penalty plus 1.5% monthly interest on the unpaid amount
• Payment method: Online through the Delaware Division of Corporations website

Important distinctions:

• Unlike corporations, Delaware LLCs are not required to file an annual report. You only need to pay the $300 annual tax.
• The $300 franchise tax is required even if your LLC earned $0 in revenue and conducted no business activity during the year.
• If you formed your LLC mid-year, you still owe the full $300 for that year, due June 1.

Delaware LLC Costs

Total first-year cost: $410-$709 (depending on whether you use a registered agent service and expedited processing). Delaware’s ongoing costs are higher than many states due to the $300 annual franchise tax. See our complete guide to LLC costs by state for a full comparison.

Cost comparison: Delaware’s $300 annual franchise tax makes it significantly more expensive than states like Wyoming ($60 annual report) or Colorado ($25 annual report) for ongoing maintenance. Make sure the benefits of a Delaware LLC justify the higher ongoing cost for your specific situation.

Delaware LLC Taxes

Delaware has no sales tax, and LLCs that don’t operate within the state generally don’t owe Delaware income tax. However, all Delaware LLCs must pay the annual $300 franchise tax regardless. Here’s the complete breakdown:

• State income tax: Delaware has a graduated income tax (2.2%-6.6%), but it only applies to income earned within Delaware. If your LLC is formed in Delaware but doesn’t conduct business in the state, you owe no Delaware income tax.
• Franchise tax: $300 per year (flat fee, regardless of income or activity). Due June 1 each year. This is sometimes called the “alternative entity tax.”
• Sales tax: None. Delaware has no state or local sales tax — one of only 5 states in the country without one.
• Self-employment tax: 15.3% on the first $168,600 of net self-employment income (2026 federal rate), plus 2.9% Medicare tax on amounts above that threshold.
• Federal taxes: Standard pass-through taxation — the LLC itself doesn’t pay federal income tax. Profits pass through to members’ personal returns.

Why Delaware? Delaware is popular for LLC formation because of its business-friendly Court of Chancery (a specialized business court with experienced judges rather than juries), its strong and well-developed LLC statute, privacy protections (member names aren’t listed in public filings), and no sales tax. However, if you don’t actually do business in Delaware, you’ll need to register as a foreign LLC in the state where you operate — which means paying fees in both states.

Annual Requirements for Delaware LLCs

To keep your Delaware LLC in good standing, you must meet these ongoing requirements:

• Annual Franchise Tax: $300, due by June 1 each year. Paid online to the Delaware Division of Corporations. Late payment triggers a $200 penalty plus 1.5% monthly interest.
• No annual report: Unlike Delaware corporations, LLCs are not required to file an annual report. Your only annual obligation is the $300 tax payment.
• Maintain a registered agent: Must have a registered agent with a Delaware physical address at all times. Since most Delaware LLC owners don’t live in the state, a commercial registered agent service is essential.
• Keep records: Maintain a current operating agreement, member records, and financial statements. Delaware’s LLC Act requires that certain records be available to members upon request.

Pros and Cons of a Delaware LLC

Advantages:

• Court of Chancery provides expert business law adjudication
• Well-established, flexible LLC statute with extensive case law
• Strong privacy — member names not in public filings
• No sales tax
• No annual report requirement (just the tax payment)
• No Delaware income tax for LLCs not operating in the state
• Expedited same-day filing available

Disadvantages:

• $300 annual franchise tax (one of the highest ongoing costs)
• If you don’t operate in Delaware, you’ll need to register (and pay fees) in your home state too
• Higher cost of doing business compared to most states for small LLCs
• Benefits primarily valuable for larger, more complex business structures

Frequently Asked Questions

How long does it take to form an LLC in Delaware?

Standard processing takes 10-15 business days. Delaware offers expedited options: 24-hour processing for an additional $50, and same-day processing for an additional $100. These expedited options make Delaware one of the fastest states for LLC formation when you need immediate approval.

Is Delaware a good state to form an LLC?

Delaware is excellent if you actually do business there, need its specialized Court of Chancery for complex business structures, or are building a company that will seek venture capital (investors are familiar with Delaware law). However, if you only do business in another state, forming in Delaware means paying the $300 annual franchise tax plus registration fees in your home state. For most small, single-state businesses, forming an LLC in your home state is more practical and less expensive. See our how to start an LLC guide for more details.

Does Delaware have sales tax?

No. Delaware has no state or local sales tax, which is a genuine advantage for businesses that sell products or services within the state. However, if your LLC operates in other states, you’ll need to comply with those states’ sales tax requirements regardless of where your LLC is formed.

Does Delaware require an operating agreement?

Delaware law doesn’t strictly require a written operating agreement, but we strongly recommend having one. Delaware’s Court of Chancery gives significant weight to operating agreements when resolving disputes, and the state’s LLC Act allows extraordinary flexibility in structuring your agreement. Without one, you miss out on much of what makes Delaware LLC law advantageous. An operating agreement also reinforces the legal separation between you and your LLC.

What happens if I don’t pay the Delaware franchise tax?

If you don’t pay the $300 annual franchise tax by June 1, you’ll face a $200 late penalty plus 1.5% monthly interest on the unpaid amount. Continued non-payment will result in administrative cancellation of your LLC. Once cancelled, you lose your liability protection and your LLC name becomes available for others to use. Reinstatement requires paying all back taxes, penalties, and interest, plus a reinstatement fee.

Start an LLC in Another State

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