Delaware is a notoriously business-friendly state, ideal for launching a limited liability company (LLC). If you’re ready to start your business, we’ve got you covered with this guide to the six steps you need to take to register an LLC in Delaware.
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Delaware LLC Quick Facts
- Registering a limited liability company (LLC) can provide personal asset protection, tax flexibility, and credibility for your business.
- To register an LLC in Delaware, you must file a Certificate of Formation.
- The filing fee to start an LLC in Delaware is $90.
6 Steps to Register an Delaware LLC
Follow the steps outlined below to ensure a smooth and successful LLC registration process.
Ready to launch your Delaware LLC? Follow these six steps to start your business:
- Name Your Delaware LLC
- Appoint a Registered Agent
- File a Certificate of Formation
- Draft an Operating Agreement
- Obtain an EIN and Handle Taxes
- File a Beneficial Ownership Information Report
Step 1: Name Your Delaware LLC
Before you register your LLC, you need to decide on a business name.
There are a few basic naming rules for LLCs in Delaware:
- Must include the term “Limited Liability Company” or an abbreviation
- Must be unique from any other business entity in the state
- Cannot include terms that may imply government affiliation
- Cannot mislead the public about your business’s purpose
We recommend reviewing the state’s complete list of LLC naming requirements before selecting a business name.
To ensure your chosen name is available, you will need to conduct a business entity search on the Delaware Division of Corporations website.
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Step 2: Appoint a Registered Agent
Appointing a registered agent is required when registering an LLC in Delaware.
A registered agent in Delaware is an individual or business entity that is responsible for receiving important legal documents and information on behalf of your company such as legal documents or government correspondence.
A registered agent in Delaware must:
- Have a physical address in the state
- Be present at the designated address during normal business hours
- Not be the LLC itself
Who is eligible to serve as a registered agent in Delaware?
When registering an LLC in Delaware, it is important to designate the right registered agent. A registered agent can be the LLC owner, an employee of the company, or a third-party registered agent service.
Step 3: File a Certificate of Formation
To formally register your LLC in Delaware, you must file a Certificate of Formation. You can submit these formation documents with the Delaware Division of Corporations online or by mail using this form.
The filing fee is $90.
We recommended that you prepare the following information:
- Your LLC name and address
- The name and address of your registered agent
- The names and addresses of all LLC owners
Quick Note: If you already have an LLC established in another state and want to operate in Delaware, you need to register as a foreign LLC. You can do so by filing a Certificate of Registration to the Delaware Division of Corporations along with a $200 filing fee.
Step 4: Draft an Operating Agreement
You aren’t required to draft an operating agreement in Delaware, however, it can be beneficial to your business regardless.
An operating agreement outlines your business procedures, member roles and responsibilities, and ownership percentages. This ensures that all LLC members are on the same page and helps to prevent future conflicts.
Step 5: Obtain an EIN and Handle Taxes
The next important step is to acquire an Employer Identification Number (EIN) for your business. An EIN is a unique identifier that allows the Internal Revenue Service (IRS) to track your business for tax reporting purposes.
You can easily obtain your EIN for free by visiting the IRS website.
Additionally, having an EIN is essential for various aspects of your LLC, including tax reporting, hiring employees, and opening a business bank account.
At this point it is also a good idea to establish any other tax responsibilities for your LLC. You can learn more about LLC tax obligations on the Delaware Division of Revenue website.
Step 6: File a Beneficial Ownership Information (BOI) Report
LLCs are mandated to file a Beneficial Ownership Information (BOI) Report with the US Financial Crimes Enforcement Network (FinCEN).
New LLCs are required to submit this report within 90 days of formation, while existing LLCs must complete the filing between January 1st, 2024, and January 1st, 2025. Failing to meet this deadline will result in a $500 per day fine.
The filing can be done conveniently online for free on the FinCEN website.
Next Steps
- Keep your business and personal assets separate by opening a business bank account. With Lili, you can open a business bank account in minutes.
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- Determine any licenses or permits required federally or by the state in order to do business. You can identify and register for necessary licenses on the Delaware One Stop website.
- Obtain insurance coverage for your business, such as general liability, workers’ compensation, and personal liability insurance, to protect your assets and operations. Next Insurance offers fast, affordable insurance coverage for new businesses.
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Additional Tips for Success
- Research the requirements: Before registering an LLC in Delaware, it is important to research the specific requirements and regulations that apply to your business.
- Stay informed about compliance requirements: It is important to stay up to date with Delaware’s compliance requirements to ensure that your LLC remains in good standing.
- Seek professional assistance if needed: Consider consulting with a legal or financial professional to ensure that you have completed all the necessary steps to successfully register your LLC in Delaware.
Conclusion
If you are considering registering an LLC in Delaware, it is important to follow the necessary steps to ensure a successful formation process. By doing so, you can set your business up for success in the state known for its business-friendly environment. Following these steps diligently and ensuring you have completed all necessary requirements, you can successfully register your LLC in Delaware and set your business up for success in the state.