How to Start an LLC in Delaware
How to Start an LLC in Delaware
Delaware is the most popular state in the country for LLC formation, and not by accident. Its business court (the Court of Chancery), predictable case law, and formation process built for speed and privacy make it a default choice for founders who want a structure investors and attorneys already understand. This guide walks through the exact steps, fees, and deadlines for forming a Delaware LLC, using the current requirements published by the Delaware Division of Corporations.
This article is informational only. It is not legal or tax advice. Delaware LLC rules and fees can change, and your specific situation (multi-member ownership, out-of-state operations, industry licensing) may require guidance beyond what's covered here. Consult a licensed attorney or CPA before filing if your situation is anything but straightforward.
What You'll Need
Before you start the Delaware LLC formation process, gather the following:
- A compliant LLC name that includes "Limited Liability Company," "L.L.C.," or "LLC" and is distinguishable from names already on file with the Division of Corporations.
- A Delaware registered agent with a physical street address in the state (not a P.O. box). This can be a commercial registered agent service or, if your business is physically located in Delaware, the business itself.
- $110 for the Certificate of Formation filing fee (plus any expedited processing fee you choose).
- An EIN application ready to file with the IRS once your LLC is approved (free, done directly through irs.gov).
- An operating agreement, drafted internally. Delaware doesn't file this with the state, but it's the document that governs ownership, voting, and profit splits between members.
- A Delaware business license application through the Delaware One Stop portal if you'll be conducting business in the state.
Step-by-Step: How to Form an LLC in Delaware
Step 1: Choose and Check Your LLC Name
Your name must contain the words "Limited Liability Company" or the abbreviation "L.L.C." or "LLC," and it must be distinguishable from every other name already registered with the Division of Corporations. Check availability using the free business name search tool before you fall in love with a name or print anything with it on there.
If you're not ready to file yet but want to lock in the name, you can reserve it for 120 days for $75 through the name reservation system. This step is optional. Most people who are ready to file within a few days skip it and go straight to Step 3.
Step 2: Appoint a Delaware Registered Agent
Every Delaware LLC must continuously maintain a registered agent with a physical street address in Delaware. This is a strict, non-negotiable requirement, not a formality: your agent receives service of process (lawsuits) and official state mail on your LLC's behalf.
If you live and work in Delaware and your business has a physical address there, you can act as your own registered agent at no extra cost. If you're forming a Delaware LLC from out of state, which is extremely common, you'll need to hire a commercial registered agent service. These typically run $50 to $300 per year depending on the provider and whether they bundle compliance alerts, mail scanning, or a virtual address. Compare at least two or three before committing since pricing and service quality vary more than people expect.
Step 3: File the Certificate of Formation
This is the actual formation document, filed under 6 Del. C. Section 18-201. You can file it two ways:
- Online through the Division's eCorp Document Upload Service.
- By mail or through your registered agent, who will typically handle the filing for you if you're using a formation service.
The filing fee is $110. The Division of Corporations does not publish a guaranteed turnaround time for routine filings, and processing time varies with how much volume they're handling that week. If you need it faster, Delaware offers paid expedited tiers:
| Service Level | Fee |
|---|---|
| Next business day (24 hour) | $50 |
| Same day | $100 |
| 2-hour service | $500 per document |
| 1-hour service | $1,000 per document |
If you need a certified copy of your filed Certificate of Formation for a bank or investor, that's an additional $50 per copy.
Step 4: Get an EIN From the IRS
Once your Certificate of Formation is approved, apply for an Employer Identification Number (EIN) directly from the IRS at irs.gov. It's free and, for most applicants with a U.S. Social Security Number, the online application issues the number immediately. You'll need the EIN to open a business bank account, hire employees, and file federal taxes.
Step 5: Draft an Operating Agreement
Delaware doesn't require you to file an operating agreement with the state, and it isn't public record. That doesn't make it optional in practice. Without one, your LLC defaults to Delaware's statutory rules for member rights, voting, and dissolution, which may not reflect what you and your co-founders actually intended. Even single-member LLCs benefit from having one on file, since banks sometimes ask for it and it reinforces the separation between you and the business (important if your LLC's liability protection is ever challenged in court).
Step 6: Register for a Delaware Business License
If you're conducting business in Delaware, you're required to obtain a state business license through the Delaware Division of Revenue, applied for through the Delaware One Stop portal. The statutory annual fee is $75 for most categories (general services, professional and occupational work, contracting, manufacturing, wholesaling) and $90 for general retailers, which includes a $15 retail crime fee. Additional business locations cost $25 to $40 each. Licenses run for one calendar year and expire December 31, though you can opt for a three-year license at three times the annual rate.
Delaware has no state sales tax. Instead, licensed businesses owe a gross receipts tax, generally somewhere between roughly 0.0945% and 1.9914% of revenue depending on your business activity, filed monthly or quarterly, with a monthly exclusion (commonly $100,000) before the tax kicks in. Because the applicable rate depends on your specific business classification, confirm your exact rate and filing frequency on the Division of Revenue's site before your first return is due.
Step 7: File a Trade Name (Only If You're Operating Under a Different Name)
If your LLC will do business under a name other than its legal registered name (a "doing business as" or DBA), you'll need to register a Trade, Business or Fictitious Name with the Delaware Division of Revenue through the Delaware One Stop portal. As of February 2, 2026, this is a single statewide registration; before that date, DBAs were filed county by county with the Prothonotary. The fee is $25 one time, statewide, and the registration doesn't expire or require renewal.
Ongoing Compliance: What Comes After Formation
This is where Delaware LLCs differ sharply from Delaware corporations, and it's worth understanding clearly so you don't miss a deadline or pay for something you don't owe.
- No annual report. Unlike a Delaware corporation, an LLC does not file an annual report with the state.
- Flat $300 annual tax, due June 1. Every Delaware LLC owes a flat $300 annual tax, due June 1 each year following the calendar year your Certificate of Formation became effective. This is a flat tax, not tied to revenue or income, and it's the same amount whether your LLC made $500 or $5 million. Miss this deadline and penalties and interest start accruing, so mark it on your calendar the day your LLC is approved.
- Registered agent must be maintained continuously. If you ever change agents or your agent's address changes, you'll need to file a change for $50.
- Business license renews annually (or every three years if you chose the multi-year option), with gross receipts tax returns filed on your assigned schedule.
Common Mistakes to Avoid
- Assuming Delaware LLCs file annual reports. They don't. People sometimes confuse the LLC's flat $300 tax with the corporation's Annual Franchise Tax Report (due March 1, $50 fee) and either miss their real deadline or pay for the wrong filing.
- Letting the registered agent lapse. If your commercial registered agent drops you for non-payment, your LLC falls out of good standing, which can jeopardize your ability to open bank accounts, sign contracts, or expand into other states.
- Forming in Delaware without understanding foreign qualification. If you don't live or operate in Delaware, forming your LLC there doesn't exempt you from registering as a "foreign LLC" in the state where you actually do business. Many first-time founders form in Delaware for the reputation, then get surprised by a second state's registration fees and franchise taxes on top of it. If your business operates entirely in your home state, forming there directly is often simpler and cheaper.
- Skipping the operating agreement. It's not filed with the state, so it's easy to treat as optional. Multi-member LLCs without one are exposed to disputes that a $0 document could have prevented.
- Not confirming your gross receipts tax rate. Because the rate varies by business activity, don't guess. Confirm your specific classification and rate directly with the Delaware Division of Revenue before your first filing period.
What to Expect Timeline-Wise
Once you submit your Certificate of Formation, approval timing depends on which processing tier you choose and how busy the Division is that week. Standard processing without an expedite fee can reasonably take anywhere from a few business days to a couple of weeks during high-volume periods; if you need certainty, the paid expedited tiers (next business day for $50, same day for $100, 2-hour for $500, or 1-hour for $1,000) generally deliver on their stated windows. After formation, expect your EIN the same day you apply (if applying online with a valid SSN), and plan for your business license and gross receipts tax registration to take another short stretch to process through Delaware One Stop. Results and exact timing can vary by filing volume and the completeness of your submission, so treat these as general expectations rather than guarantees.
Delaware LLC Costs at a Glance
| Item | Cost |
|---|---|
| Certificate of Formation filing fee | $110 |
| Name reservation (optional, 120 days) | $75 |
| Registered agent (if hiring a service) | $50 to $300/year |
| Annual LLC tax (due June 1 every year) | $300 flat |
| State business license (general/professional) | $75/year |
| State business license (general retail) | $90/year |
| Trade name (DBA) registration, if applicable | $25 one time |
| Certified copy of Certificate of Formation | $50 each |
Frequently Asked Questions
Do I need to live in Delaware to form an LLC there?
No. You can form a Delaware LLC from anywhere as long as you maintain a registered agent with a Delaware street address. Many owners who form in Delaware never set foot in the state.
How much does it cost to start an LLC in Delaware?
At minimum, expect $110 for the Certificate of Formation, plus a registered agent fee if you're not acting as your own (commonly $50 to $300 per year), plus the $75 or $90 state business license fee if you're conducting business in Delaware. Budget for the $300 flat annual tax going forward as well.
Does a Delaware LLC pay Delaware state income tax if it doesn't operate in Delaware?
This depends on your specific facts, including where you actually do business and how the LLC is taxed federally (disregarded entity, partnership, or corporation). This is exactly the kind of question to bring to a CPA rather than rely on a generic answer, since it affects both your Delaware exposure and your home state's rules.
Bottom Line
Forming an LLC in Delaware is a straightforward process: pick a compliant name, line up a registered agent, file the Certificate of Formation for $110, get your EIN, and register for a business license if you're operating in the state. The part people underestimate is what comes after formation, specifically the flat $300 annual tax due every June 1 and the ongoing registered agent requirement. Put both on a calendar the day your LLC is approved, and you'll avoid the penalties that catch first-time filers off guard.
This article is for general informational purposes and reflects Delaware requirements as of the date researched. It is not legal or tax advice. Fees, deadlines, and requirements can change, and your specific situation may call for guidance beyond what's covered here. Consult a licensed Delaware attorney or CPA before making formation, tax, or licensing decisions for your business.