Delaware LLC Incorporation
Delaware was the first of the 13 territories to become a state of the United States of America after ratifying the constitution as the Federal Constitutional Convention, which met in Philadelphia in 1787. Delaware has since been known as "The First State".
Located midway between New York City and Washington DC with the state of Pennsylvania on its northern boundary and Maryland to its south, access to the Atlantic shipping lanes by the Delaware River, it is strategically placed for domestic and international trade and commerce.
Delaware main sources of income are from the chemical and automobile industries, followed closely by its financial services sector.
Delaware Corporation Law
With a long standing tradition of a strong and stable General Companies Law, Delaware enacted its Limited Liability Companies (LLC) Legislation in October of 1992. The LLC Act provides for pass-through tax treatment for a company with Limited Liability. Not unlike the US Subchapter “S” Corporation, but without the complex nature, regulations and restrictions which govern that form of business entity.
Delaware LLC Features:
A Delaware Limited Liability Company (LLC) is a hybrid business entity which combines the positive features of the Limited Partnership and the Corporation (company limited by shares).
- A Delaware LLC may have one member only; however this is not advisable for non-resident aliens, due to unfavorable tax considerations. The better option is to have two or more members.
- The LLC is a separate legal entity.
- Delaware Limited Liability Companies do not have shareholders. Its owners are members with authority in proportion to the member's contribution to the whole.
- Because an LLC has limited liability status, the members have protection for their personal wealth. The LLC alone is responsible for its debts and other obligations.
- Meetings of members may be held anywhere in the world and in any manner convenient to its members. Meetings are not a statutory requirement.
- Management and control of an LLC is usually undertaken by its members and there is no board of directors. Managers may be employed if deemed necessary and a manager may be a member.
- Voting rights in the LLC usually correspond directly with a member's interest in profits.
- In a Delaware LLC membership can be easily transferred.
- A Delaware LLC has pass-through tax status i.e. the LLC has no tax liability. The members are taxed individually on the profits distributed to them.
- An LLC is formed when the Articles of Organization is filed with the Delaware Secretary-of-State.
- Non-resident aliens may fully own a Delaware LLC. There are no restrictions to citizenship or residence for ownership.
- A non-resident alien is not liable for US income tax on income derived outside of the United States.
- Members of a Delaware LLC are not liable to the United States for income tax providing that:
- These members are non-resident aliens.
- These members do not employ US residents as permanent staff, or rely on a dedicated place of business within the United States.
- The LLC does not undertake any business activity that is effectively connected with business or trade within the United States.
To organize a Delaware company (LLC), a registered agent and a registered office are required in the state, also an office as a point of contact is required. We provide these services to you along with filing the Articles of Organization with the Delaware Secretary-of-State.
Delaware does not require disclosure of member's information, except on the Annual Information Report. We provide Nominee Service to protect your privacy when required.
A Delaware LLC can be used in the same way as an offshore company (IBC) registered in a tax haven for conducting legitimate business outside the USA.