Wyoming vs Delaware LLC for Non-Resident Owners
TL;DR
For a non-resident single-member LLC, the federal side is identical in every state — same Form 5472, same ECI question. The real differences are cost and paperwork: Wyoming’s annual report starts at $60; Delaware’s LLC franchise tax is a flat $300. Delaware’s fame comes from venture-backed corporations — for a seller’s LLC, Wyoming is usually the pragmatic pick.
The comparison that matters
| Wyoming | Delaware | |
|---|---|---|
| Annual state cost | $60 min license tax | $300 flat franchise tax |
| Annual filing | Short online report | Tax payment (no info report for LLCs) |
| Privacy | Strong — members not on public record | Strong for LLCs as well |
| Court-system fame (Chancery) | Irrelevant to a small SMLLC | Matters for VC-backed corporations |
| State income tax on your LLC | None | None for out-of-state operations |
| Federal filings | Identical | Identical |
The Delaware mythology, deflated politely
Delaware’s Court of Chancery and investor familiarity are real advantages — for C-corporations raising venture capital. None of that machinery does anything for a single-member LLC selling on Amazon. Banks and platforms onboarding a foreign-owned LLC look at your formation documents, EIN, and identity verification; the state name on the certificate moves nothing. Meanwhile the $300-vs-$60 gap quietly repeats every year.
What state choice does NOT change
- Form 5472. Foreign-owned is foreign-owned — the $25,000-penalty filing follows the ownership, not the state.
- Income tax analysis. ECI is a federal question; no state selection answers it.
- Sales tax. Marketplace facilitator rules operate wherever your customers are — Amazon handles most of it either way.
- Banking reality. Fintechs onboard Wyoming and Delaware LLCs identically.
When Delaware genuinely makes sense
You’re building toward venture funding or a future C-corp conversion, sophisticated investors are in the picture, or a specific counterparty requires it. Those are real cases — and they’re not the typical cross-border seller.
If you already formed in the “other” state
Don’t panic and don’t rush to redomesticate over $240 a year. The costs of moving (new filings, new EIN questions, banking updates) usually exceed years of the fee difference. Keep the entity compliant where it is — state report plus federal filings — and fold the question into your next real structural decision.
This article is general information, not tax or legal advice. Fees change and specific situations differ — confirm current numbers with each state before forming.
File it the right way
Laramie Ledger Tax handles foreign-owned LLC filings at flat published prices, prepared and signed by a licensed U.S. tax preparer.
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