At a glance
| Factor | Wyoming | Delaware |
|---|---|---|
| Formation fee | $100 | $110 |
| Annual cost | $60 report | $300 franchise tax |
| State income tax | None | None on out-of-state income |
| Owner privacy | Members not public | Members not public |
| Asset protection | Strong, incl. single-member | Strong |
| Investor familiarity | Moderate | Highest (Court of Chancery) |
| Best for | Online businesses, holding, e-commerce | Venture-track startups |
The simple rule
Choose Wyoming if you are running a U.S.-facing business and want maximum name recognition with banks and counterparties. Choose Delaware if you plan to raise institutional venture capital — and in that case, usually as a C-corporation rather than an LLC. And before either: if your business operates entirely outside the U.S., consider New Mexico — no annual report, no recurring fees, and the strongest privacy. It is the state we recommend first for international founders.
Where Delaware earns its reputation
Delaware's advantage is legal infrastructure: the Court of Chancery, two centuries of corporate case law, and universal familiarity among investors and counsel. None of that meaningfully benefits a bootstrapped non-resident LLC selling software or goods abroad — but it matters enormously the day a term sheet arrives.
Where Wyoming quietly wins
For everyone else, Wyoming's arithmetic is hard to argue with: a fifth of Delaware's annual cost, equal or better privacy, and charging-order protection that explicitly covers single-member LLCs. Our full Wyoming guide covers the details.
Undecided? Jurisdiction strategy is the first step of every Westmark engagement — we recommend the state that fits your facts, not a default. Start with formation →
Frequently asked questions
Is Delaware or Wyoming cheaper?
Wyoming. Formation is $100 vs. Delaware's $110, but the real difference is annual cost: Wyoming's $60 report vs. Delaware's $300 franchise tax.
Which state is more private?
Both keep members off the public formation record, but Wyoming's overall regime — combined with no state information sharing obligations beyond the annual report — is generally considered the most private mainstream option.
Do investors really prefer Delaware?
For venture-backed C-corporations, yes — Delaware's Court of Chancery and settled case law are the standard. For a bootstrapped LLC, investor preference is rarely a factor.
Can I move my LLC from one state to another later?
Yes, through a process called domestication (or by merger). Both Delaware and Wyoming permit it, so an early choice is not irreversible.
What about New Mexico?
For most international founders, New Mexico is actually our first recommendation: the lowest cost of any state ($50 to form), no annual report at all, and privacy equal to or better than Wyoming. Unless you need Wyoming's name recognition or Delaware's investor familiarity, start there.