WEBVTT 00:00:00.227 --> 00:00:05.027 To start an LLC in Delaware, you file a Certificate of Formation with the Delaware 00:00:05.071 --> 00:00:09.107 Division of Corporations and pay the $110 filing fee. 00:00:09.537 --> 00:00:12.947 A hundred and ten dollars for the famous Delaware name. 00:00:13.080 --> 00:00:14.547 Where's the catch? 00:00:14.547 --> 00:00:21.427 The catch is a yearly bill. Delaware LLCs file no annual report, but every one 00:00:21.491 --> 00:00:28.307 pays an annual tax on June 1, and for 2026 that tax is $400. 00:00:28.307 --> 00:00:30.787 This is The Business Formation Podcast. 00:00:30.867 --> 00:00:36.227 Today, Delaware for 2026, in six steps, with what it all costs and the three best 00:00:36.291 --> 00:00:37.987 ways to have it filed for you. 00:00:38.147 --> 00:00:39.827 Let's begin with the name. 00:00:40.947 --> 00:00:47.667 Delaware wants Limited Liability Company, L.L.C., or LLC in the name, and the name 00:00:47.727 --> 00:00:50.867 has to be distinguishable from every name already on record. 00:00:50.867 --> 00:00:54.387 How do I find out whether mine is free? 00:00:54.387 --> 00:00:58.547 The Division of Corporations runs a name search on its website. 00:00:58.667 --> 00:01:01.828 Check there before you pay anyone for anything. 00:01:01.828 --> 00:01:04.308 And if I like a name but I'm not ready to file? 00:01:04.308 --> 00:01:07.348 You can reserve it for 120 days. 00:01:07.412 --> 00:01:09.508 That costs $75. 00:01:11.252 --> 00:01:14.532 Now the agent. Does Delaware let me do it myself? 00:01:14.532 --> 00:01:16.532 It does, which surprises people. 00:01:16.672 --> 00:01:22.452 The agent can be the LLC itself, if it keeps an office in Delaware, or a Delaware 00:01:22.505 --> 00:01:25.492 resident, or a business with an office in the state. 00:01:25.492 --> 00:01:27.412 So I just list my house? 00:01:27.412 --> 00:01:29.412 Only if you actually live there. 00:01:29.552 --> 00:01:34.292 The agent can't operate solely through a virtual office or mail forwarding, and 00:01:34.332 --> 00:01:38.692 whoever you list is generally expected to be at that office to accept papers. 00:01:39.156 --> 00:01:40.932 Most founders aren't in Delaware. 00:01:40.932 --> 00:01:44.212 Right, which is why most use a commercial agent. 00:01:44.312 --> 00:01:47.492 Whoever you pick, their details are public. 00:01:47.679 --> 00:01:52.852 If you change agents later, a certificate of amendment that changes only the agent 00:01:52.959 --> 00:01:54.452 costs $50. 00:01:55.547 --> 00:01:57.147 Okay, the filing itself. 00:01:57.147 --> 00:02:01.707 You complete the Certificate of Formation and either upload it through the Division 00:02:01.734 --> 00:02:05.387 of Corporations' document filing service or mail it in. 00:02:05.487 --> 00:02:07.947 The fee is $110. 00:02:07.947 --> 00:02:09.787 Is the form long? 00:02:09.787 --> 00:02:14.587 It's short. Really just the name and the registered agent, signed by an authorized 00:02:14.644 --> 00:02:15.067 person. 00:02:15.067 --> 00:02:17.627 I'm Maya, by the way, here with Dan. 00:02:17.627 --> 00:02:18.987 Glad you're here, Maya. 00:02:19.667 --> 00:02:21.627 Can I speed it up if I'm in a hurry? 00:02:21.627 --> 00:02:24.827 Yes, and Delaware sells speed in tiers. 00:02:24.955 --> 00:02:28.347 Next day runs from $50 to $100. 00:02:28.475 --> 00:02:35.147 Same day is $100 to $200. Two hours is $500, and one hour 00:02:35.280 --> 00:02:37.467 is $1,000. 00:02:37.467 --> 00:02:40.107 A thousand dollars for an hour! 00:02:40.107 --> 00:02:44.987 That's the top of the ladder. The cheaper tiers are there if a deadline is close. 00:02:45.391 --> 00:02:47.791 Is there anything to file for the operating agreement? 00:02:47.791 --> 00:02:50.151 No. Keep it with your records. 00:02:50.198 --> 00:02:52.591 There's no filing and no state fee. 00:02:52.591 --> 00:02:54.191 So why bother? 00:02:54.191 --> 00:02:58.111 Because Delaware is known for letting the agreement do the heavy lifting. 00:02:58.271 --> 00:03:03.151 Its LLC law gives owners a lot of freedom, and your own document is where you use 00:03:03.204 --> 00:03:08.991 it. Write down who owns what, how profits are split, who decides, and what happens 00:03:09.007 --> 00:03:10.271 when a member leaves. 00:03:10.271 --> 00:03:12.511 Even if I'm the only member? 00:03:12.511 --> 00:03:13.071 Yes. 00:03:13.680 --> 00:03:15.520 Next, the tax ID. 00:03:15.520 --> 00:03:19.760 Apply with the IRS at IRS.gov. 00:03:19.893 --> 00:03:23.920 It's free, and you do it after the state files your Certificate. 00:03:23.920 --> 00:03:24.800 How fast? 00:03:24.800 --> 00:03:29.040 If the online application is approved, the number comes back right away. 00:03:29.168 --> 00:03:34.000 Keep the Social Security number or ITIN of the person in charge handy. 00:03:34.000 --> 00:03:37.680 What about that ownership report I keep hearing about? 00:03:37.680 --> 00:03:40.200 For U.S. companies, you can skip it. 00:03:40.290 --> 00:03:42.320 FinCEN no longer requires it. 00:03:43.066 --> 00:03:45.706 And this is the part that makes Delaware different. 00:03:45.706 --> 00:03:50.586 It is. Delaware doesn't ask LLCs for an annual report. 00:03:50.719 --> 00:03:57.546 It asks for a tax. The amount is $400, due June 1 every year, 00:03:57.590 --> 00:03:59.466 starting the year after you form. 00:03:59.938 --> 00:04:02.105 I thought it was $300. 00:04:02.105 --> 00:04:08.426 It was, before tax year 2026. The state raised it to $400 this year. 00:04:08.426 --> 00:04:11.706 Does the tax get smaller if I form in the fall? 00:04:11.706 --> 00:04:18.106 No. It isn't prorated. A company formed in December owes the same $400 on the next 00:04:18.170 --> 00:04:20.746 June 1 as one formed in January. 00:04:20.746 --> 00:04:22.746 What if I forget? 00:04:22.746 --> 00:04:29.706 There's a $200 penalty, and interest of 1.5% a month on the tax and the penalty. 00:04:29.773 --> 00:04:34.346 Leave it unpaid for three years, and the state cancels your certificate. 00:04:34.346 --> 00:04:37.466 Canceled, as in the LLC stops existing? 00:04:37.466 --> 00:04:42.266 The certificate is what makes it a company, so yes, that's the risk. 00:04:42.546 --> 00:04:47.148 A $400 bill that you ignore can turn into a much bigger problem. 00:04:48.160 --> 00:04:50.267 So pay it on time and move on. 00:04:50.267 --> 00:04:51.947 That's the whole strategy. 00:04:52.716 --> 00:04:54.876 So what's the total to do it all myself? 00:04:54.876 --> 00:05:00.556 $110 to form. Then $400 every June 1, starting the year after. 00:05:00.776 --> 00:05:07.676 The EIN costs nothing. Add $75 if you reserve the name, or $50 if you swap 00:05:07.733 --> 00:05:08.476 agents later. 00:05:08.476 --> 00:05:10.316 And the agent fee on top? 00:05:10.316 --> 00:05:12.756 Yes, whatever your agent charges. 00:05:12.796 --> 00:05:14.476 That part isn't set by the state. 00:05:14.476 --> 00:05:18.716 So if I reserve the name and form right away, what's the first bill? 00:05:18.716 --> 00:05:25.676 $75 plus $110, which is $185. Then the tax is not 00:05:25.736 --> 00:05:28.716 due until the June 1 after you form. 00:05:28.716 --> 00:05:31.036 So the tax is the number to plan around. 00:05:31.036 --> 00:05:36.636 Exactly. In Delaware, the $110 is the small part of the picture. 00:05:38.316 --> 00:05:40.396 Give me an order of operations. 00:05:40.396 --> 00:05:45.516 Pick the name and the agent. If you need the name held, reserve it for 120 days. 00:05:45.740 --> 00:05:49.276 File the Certificate. Write the operating agreement. 00:05:49.436 --> 00:05:53.355 Get your EIN. Then put June 1 in your calendar. 00:05:53.783 --> 00:05:55.676 Which one catches people out? 00:05:55.676 --> 00:06:00.156 The tax. There's no report to prompt you, so if you don't mark the date yourself, 00:06:00.196 --> 00:06:01.756 the penalty gets there first. 00:06:02.510 --> 00:06:04.750 And if I want someone to take care of all this? 00:06:04.750 --> 00:06:07.910 Here are the three best ways to file in Delaware. 00:06:07.984 --> 00:06:14.510 Number one, our pick, is Mainstay Filing, $199 a year plus the state fee. 00:06:14.638 --> 00:06:19.790 With the $110 state fee, checkout comes to $309. 00:06:19.790 --> 00:06:21.710 What's inside that? 00:06:21.710 --> 00:06:27.150 Your Certificate of Formation filed, your EIN application, and your registered agent 00:06:27.230 --> 00:06:31.150 every year. It renews at the same $199. 00:06:31.250 --> 00:06:33.950 And it reminds you before the June 1 tax. 00:06:33.950 --> 00:06:35.870 Does it pay the tax for me? 00:06:35.870 --> 00:06:39.990 No. The $400 goes to the state and it's yours to pay. 00:06:40.046 --> 00:06:44.270 Mainstay just makes sure the date doesn't sneak up on you, since Delaware sends no 00:06:44.339 --> 00:06:46.030 annual report to prompt you. 00:06:46.030 --> 00:06:47.390 Number two? 00:06:47.390 --> 00:06:54.030 DE Registered Agent.org. It prepares and files your Certificate for $199 00:06:54.110 --> 00:06:59.630 plus the state fee, with your first year of registered agent service free, then $99 00:06:59.670 --> 00:07:00.670 a year. 00:07:00.670 --> 00:07:01.310 And three? 00:07:01.310 --> 00:07:08.110 Delaware Registered Agent.ai. The same offer: $199 plus the state 00:07:08.190 --> 00:07:13.470 fee, a free first year of agent service, then $99 a year. 00:07:13.470 --> 00:07:14.910 How do I choose? 00:07:14.910 --> 00:07:19.670 Delaware has no annual report, so there's nothing for a service to file each year. 00:07:19.737 --> 00:07:25.790 If all you need is an agent, two and three cost less from year two, at $99. 00:07:25.843 --> 00:07:30.830 If you want the agent and the date reminder in one steady price, that's Mainstay. 00:07:33.030 --> 00:07:34.710 Give me a number over three years. 00:07:34.710 --> 00:07:41.270 Mainstay is $199 a year, so $597. 00:07:41.490 --> 00:07:47.990 The other two are $199 in year one, then $99 and 00:07:48.036 --> 00:07:51.430 $99, for $397. 00:07:51.430 --> 00:07:52.710 Two hundred dollars apart. 00:07:52.710 --> 00:07:57.830 Yes. And the $400 tax is identical with all three. 00:07:59.500 --> 00:08:01.740 One more pass, start to finish. 00:08:01.740 --> 00:08:06.620 Choose a name with LLC in it, name an agent with a Delaware office, file the 00:08:06.660 --> 00:08:13.260 Certificate of Formation for $110, write an operating agreement, get your free EIN, 00:08:13.280 --> 00:08:16.140 and pay the $400 tax every June 1. 00:08:16.140 --> 00:08:20.220 The links to all three services and every official source are in the show notes. 00:08:20.277 --> 00:08:23.820 Thanks for listening to The Business Formation Podcast, and good luck with your new 00:08:23.882 --> 00:08:25.260 Delaware LLC.