How to Start an LLC in Delaware
Starting an LLC in Delaware is the fastest way to form a new business. The state offers various tax credits and financial incentives, such as the popular EDGE Grant, to small businesses. The state-tax-free economy of Delaware also boosts its business environment.
With these benefits, you can significantly increase your income by establishing a business. So let’s find out how to start an LLC in Delaware:
Name Your Business
You may already have a business name idea. However, before deciding on a name, ensure its availability through the State of Delaware Division of Corporations’ search engine. You must also ensure that the name you have selected complies with the Delaware business name regulations.
If you are unsure how to name your business, consider using a business name generator for ideas and inspiration.
Reserve the Business Name
The state of Delaware reserves business names for 120 days for a fee of $75. Once you find a name you like, which is also available, it is a good measure to reserve it, so you don’t have to repeat the first step. While you can apply by mail, the faster and easier way to execute this step is to apply online. Business name reservation applications submitted online are immediately processed.
Click here to reserve your Delaware LLC name online.
Get an Official LLC Address
All Delaware LLCs require an official address. While you can submit your residential address or an address outside the state to start an LLC in Delaware, it must be a physical street address, not a P.O. Box.
If you start your small business from home, maintain your privacy or avoid mixing your personal and professional life by getting a virtual mailbox address. A virtual mailbox address can also come in handy if you travel a lot or plan on moving houses or offices.
Appoint a Registered Agent
Appointing a registered agent is important for starting an LLC in Delaware. A registered agent is a person or entity responsible for business correspondence on behalf of an LLC. You can appoint anyone as your business’s registered agent as long as they have a Delaware physical street address and are available during work hours to conduct business.
LLC registered agents are usually appointed along with the establishment of a business. However, you may need a registered agent to reserve a name. In that case, you can appoint your business’s registered agent earlier.
File LLC Articles of Formation
The articles of formation is a document containing information about an LLC getting registered. The information includes but is not limited to the following:
Business name and address
Business purpose
Business duration
Business members’ names and addresses
Registered agent name and address
Name and signature of the person filing the articles of formation
It costs $115 and is filed with the Delaware Division of Corporations. Like the business name reservation application, articles of formation can also be filed online or through the mail.
Get an EIN
All Delaware businesses must register themselves with Internal Revenue Service (IRS). Upon registration, IRS provides businesses with a nine-digit number which is the Employer Identification Number or EIN. EIN is like a social security number for businesses. It allows them to open a bank account, report and file taxes, and hire employees.
This step does not cost any fee. The process of obtaining an EIN is also fairly simple. Click here to get an Employer Identification Number for your LLC.
Submit Annual Report
All Delaware LLCs are required to file an annual report and pay a fixed tax of $300 before June first. Failure to pay this amount can result in a heavy penalty charge. Therefore, it’s important to submit the annual report and pay the tax soon after starting an LLC in Delaware. Don’t forget to place a reminder in the calendar to execute this step every year.
Create an LLC Operating Agreement
An LLC operating agreement is an internal business document explaining the operational framework of a business. Getting an operating agreement is mandatory in certain US states but not Delaware. However, creating one can greatly benefit and protect you and your business.
Since they carry the operational framework for a business, operating agreements can keep businesses running smoothly. You may especially find it helpful in cases of unwanted demands and requests. Click here to find Delaware LLC operating agreement templates and examples. They will provide you with ideas on the processes and information you can include in your business’s operating agreement. The contents of an operating agreement include, but are not limited to:
Business member’s roles and responsibilities
Recruitment process and check-list
Profit sharing
Voting rights
Processes of elimination or addition of business members
Build a Website and Market Your Business
Starting an LLC in Delaware isn’t limited to the legal process. You must also establish your business in the digital world and continuously market it to make it profitable.
Getting a website is a multi-step process, including getting a website host, securing a domain name, building a layout, writing copy, adding images and features, etc. Similarly, marketing a business also includes:
Traditional marketing, i.e., advertising in local newspapers and magazines
Social media marketing, i.e., creating social media business profiles, creating and publishing content, and running ads
Digital marketing, i.e., creating business profiles on platforms like Yelp, Nextdoor, etc., brainstorming digital media campaigns, and much more.
Managing a website and marketing a business is a full-time job. But you don’t have to worry even if you don’t have any prior experience. Simply head to Trady.com.
Trady.com is a website-building service dedicated to trades and home services companies. The cost-friendly services of Trady.com allow you to build a website in minutes with exclusive features like booking appointments, making payments, generating invoices, and following up with clients online. The end-to-end marketing services by Trady.com also ensure your business stands out among its local competition and that you consistently get new customers.
Trady.com is your one-stop solution to successfully executing the last step of starting an LLC in Delaware. Enjoy the 14-day free trial by Trady.com to save money while learning more about the service.