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.

Wyoming or Delaware: what actually differs?

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 does Delaware genuinely make 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.

The other names you’ll hear: New Mexico, Florida, Texas

New Mexico markets itself on having no annual report at all for LLCs — genuinely cheap, but the savings are small against Wyoming’s $60, and some banks and platforms see NM formations less often, which can mean extra verification friction. Florida and Texas make sense when the owner has actual physical operations there (inventory, staff, an office) — at which point the state is choosing you, not the other way around. For a remote non-resident seller with no U.S. footprint, the decision usually collapses back to Wyoming on cost, familiarity, and clean online filing. (And if the real question is whether to use a U.S. entity at all, the US-LLC-vs-Hong-Kong comparison is the one to read first.)

Watch the formation-service upsell, not the state fee

The real cost difference between states is often smaller than the difference between formation packages. Common padding: an EIN “service” marked up several times over what the application actually involves, “compliance packages” that duplicate what your registered agent already does, and vague “tax consultation” add-ons that end with no one signing anything. Buy the formation and agent; get the EIN and tax filings from someone who signs returns with a PTIN — the accountability lives with the signature, not the bundle.

Official references: Wyoming Secretary of State — Business Division · Delaware Division of Corporations.

This article is general information, not tax or legal advice. Fees change and specific situations differ — confirm current numbers with each state before forming.