Delaware is known as a business-friendly state, and an LLC is known as a business-friendly concept, therefore, many business owners are interested in Delaware LLC registration. You will benefit from the flexibility and asset protection that an LLC offers.
Benefits of Delaware LLC Registration
A limited liability company (LLC) is a type of legal business entity that combines elements of corporations and sole proprietorships. It provides business owners with limited liability protection similar to that of a corporation. The personal assets of LLC owners are typically protected in incidents when the business is sued or incurs debt.
However, like a sole proprietorship, the LLC's profits are usually not taxed at the business level before being distributed to the LLC owners (referred to as "members"). By doing this, the "double taxation" that results from traditional corporations' profits being subject to both business and personal taxes is avoided. Additionally, LLCs have less paperwork to file and more flexibility.
Please watch the video given below to get more details:
Step 1: Give a name to your Delaware LLC
The process of naming your company can be fun and interesting. You may already have one or two names in mind, but you’ll still have to follow Delaware’s naming guidelines.
Availability of Delaware LLC Name
First, your name must be unique in the state of Delaware—that is, it cannot be already in use by a company. It must legally be distinguished from any other Delaware company in order to prevent confusion.
Get a domain name for your Delaware LLC
When you have chosen an LLC name, it’s a good idea to consider whether you can secure a matching domain name. This way you can easily find your future company’s website.
Check for existing trademark registrations
Even if the state approves the name of your Delaware LLC, that doesn't mean you're safe. It's possible that the desired name is already trademarked.
You can consider registering your own trademark as well.
Also read: Can I open a US business bank account from abroad?
Step 2: Appoint a registered agent for your LLC in Delaware
A registered agent must be chosen as part of the LLC's business formation in Delaware. The main responsibility of a Delaware registered agent is to receive official state correspondence and legal documents (such as lawsuit notices) on your company's behalf.
The registered agent must:
- Be a resident of Delaware or a company that has permission to operate there.
- Have a Delaware street address, also known as the "registered office" (a P.O. box is not allowed).
- Be available in person during regular business hours.
Step 3: Complete and file your Certificate of Formation
This document is also known as the Articles of Organization, it makes your LLC in Delaware official once it is approved.
You must include the following details in your Certificate of Formation:
- The full name of your Delaware LLC, including the designation
- The name and address of your registered agent
- The name and signature of an authorised person
Also read: US company formation - registered company vs sole proprietorship
Step 4: Make an operating agreement for your Delaware LLC
Making an operating agreement is a crucial step in creating a Delaware LLC because it outlines your company's rules, how to manage them, the ownership each member has, how profits will be distributed, and more.
Step 5: Get an EIN
After setting up your new Delaware LLC with the Division of Corporations, you’ll need to register with the federal government and get an EIN from the Internal Revenue Service (IRS) for tax purposes.
An EIN is similar to a Social Security number for your business, which allows you to hire employees, apply for a business bank account, and pay taxes.
You can collect the EIN for your Delaware LLC from the IRS website, by mail, or by fax, but if you want to avoid dealing with the IRS, RTRSupports Limited can do it for you. Its EIN service is quick, simple and hassle-free.