Start a Delaware Company as a Non-US Citizen
If you live outside of the United States, but you want to start a company in the US, then you’ve come to the right place. Delaware is the best state for forming a corporation or LLC if you live outside of the country.
Why Start a Company in Delaware?
Delaware is the premier state for foreign business owners to form their companies. The Delaware Division of Corporations office processes hundreds of companies for non-US citizens every day. They know all the ins and outs of starting companies for citizens from every country in the world.
Cheap, Business-Friendly Taxes
- No corporate income tax for businesses that do not conduct business in Delaware
- No tax on corporate stock for owners who live outside of Delaware
- Annual fees as low as $225 for a corporation and $300 for an LLC
The Delaware Court of Chancery
Delaware is unique because it is the only state in America that has a separate court to handle business law. The Court of Chancery has overseen all corporate law in Delaware for over a hundred years. With all of this legal history, companies in Delaware have a very clear roadmap for how to conduct business in Delaware.
Are you from a country with an oppressive government?
Delaware LLCs do not list the members or managers on the formation documents or the annual filing to the state. The only name that would show up is the organizer (The person authorized to form the company). When you hire us and use our free incorporation service, we sign as the authorized person, thus keeping your information off the documents filed with the state. Delaware Corporations do not have to list officers or directors on the formation documents, BUT when you file the annual report they must be listed. Your oppressive government would have to order a certified copy of the annual report to get to this information, which is not simple, but it is relatively easy to get if you are concerned about this. So Delaware corporations don’t post officer and director information online, but someone can purchase copies of the documents to see who the officers and directors are. If you’re in a country where your government could easily seize your assets, a Delaware LLC is a more private option.
Step By Step Starting Your Company in Delaware
One: Choose an Entity
Your first decision is choosing what type of entity you want to form: Corporation, Limited Liability Company, Nonprofit Corporation, Partnership, etc. The forms are different for each entity, so you must make your choice now. The most common choice is the Delaware LLC. If your going to need to register your Delaware company in your home country and you’re not worried about your government seizing your assets for no reason, a Delaware corporation might be more familiar to your home country lingo.
Two: Hire a Registered Agent
Delaware state law requires all business entities to hire a Delaware registered agent. Your registered agent can be an individual who lives in the state, or a business entity that is already authorized to conduct business in Delaware. Either way, your Delaware registered agent must maintain a physical address in Delaware where certified mail can be delivered during regular business hours. We fulfill this requirement for you, for $50 a year.
Three: File Your Formation Documents
- LLC: Certificate of Formation
- Corporation: Certificate of Incorporation
If you sign up for our Free Incorporation Service, we can file these documents for you. You will pay only the state filing fees ($110 for LLCs and $109 for Corporations). If you choose to file these documents yourself, you must mail or fax the documents to the Delaware Division of Corporations.
Note: You must appoint a registered agent on your formation documents. Your business formation paperwork will be rejected without one.
If everything is in order and your fees fully paid for, the Delaware Corporations Division will approve your filing. You will be sent a stamped filed copy of your formation documents free of charge (if you sign up for our Free Incorporation Service, we will email them to you). You can request certified copies if you need them.
You are now the proud owner of a Delaware company in the United States!
After Your Business is Formed
Federal Tax ID Number
Your company may need a Federal Tax Identification Number (FEIN or EIN). If you are going to have US employees working within America, this will be necessary.
An FEIN is used by the US Internal Revenue Department. It identifies a company for tax purposes. When you pay taxes to the US federal government, or when you take out federal tax withholdings from American employee paychecks, the IRS will use this number to identify your company and make sure you have paid your taxes properly.
Non-US citizens can obtain FEINs for their US-based companies even without a social security number. You will have to pay corporation income taxes to the IRS off of the profits of your Delaware Company. (If you want to be legit).
If your business requires that you open a bank account in the US, the best thing to do is call the bank branch where you intend to open an account. American banks are not uniform. Different banks and different bank branches will have unique requirements for opening a business account. The only way to know exactly what you’ll need is to call the bank and ask for their specific process. We would recommend a world wide bank, where you could go to a bank in your local country and show proof of who you are, have them check your ID and verify your identity, and then communicate with a local banker in the US>
One of the advantages of forming your company in Delaware is that Delaware banks are used to opening accounts for non-US citizens who own Delaware companies. You will have far less hassle and far fewer problems with Delaware banks than you would in other states.
A piece of advice: open an account with an international bank that has a branch in your home country. Banks like Wells Fargo, Citibank, Bank of America, Chase and USBank have wide international reach. This way, should anything go wrong with your account, you can contact the bank in your home country and work through the problem.
File Beneficial Ownership Information Report
As part of an effort to combat financial crime, the Financial Crimes Enforcement Network (FinCEN) has issued a mandatory federal filing requirement that applies to most businesses operating in the US (some companies that are already highly regulated are exempt).
Most LLCs, corporations, and similar state-registered companies must file a Beneficial Ownership Information (BOI) report that provides FinCEN with name, address, and tax or personal identification information for the company, its beneficial owners, and its company applicants.
- Reporting company: your business
- Beneficial Owner(s): any person with substantial control over company business decisions or who owns 25% or more of the company
- Company Applicant(s): the person in charge of company formation and/or who files your formation documents
Beneficial Owner and Company Applicant Information
You can file for free online through Beneficial Ownership Secure System (BOSS). The information you provide is not available to the general public.
When do I file my BOI report?
It depends on when your business was formed.
- Before January 1, 2024: Anytime between January 1, 2024 and January 1, 2025.
- Sometime in 2024: Within 90 days of formation.
- After January 1, 2025: Within 30 days of formation.
Do I have to file a BOI report?
Probably. But if you don’t want to have to worry about it, we can do it for you. For just $9, we’ll file your BOI report with FinCEN as soon as your business is formed.
A merchant account is procured through a bank. It represents a business arrangement that allows you, the Merchant, to accept payment from customers in the form of credit cards and electronic checks. When you accept payment, the money is deposited directly into your bank account.
Opening a US merchant account will require that you already have a US bank account, US business address and a US phone number. Another easy option is PayPal for your business, although PayPal is a private company and you are not protected by any of the banking regulations normal merchant accounts provide. PayPal will screw you over and leave you high and dry, and your only option will be to sue them. You have no moral or regulatory help when dealing with PayPal.
US Phone Number
There are multiple providers who can supply you with a US phone number. You can acquire a phone number through a provider like Ring Central, Grasshopper, or OneBox.
Many of these services don’t even use standard phone lines. Instead, they route calls through high-speed internet lines and store data in cloud phone systems. Most have systems that can forward calls from your local US number directly to your cell phone, allowing you to work from anywhere in the world.
A virtual office service can provide you with a US address, mail forwarding, and, in some cases, a US phone number. US law has strict rules for who can legally engage in mail forwarding services, so be sure to choose a reputable virtual office service. While many services operate anywhere in the US, some are specific to a particular state. Delaware Mailboxes LLC, for example, supplies virtual office service specifically in the State of Delaware. A UPS Store is a great option for getting a Delaware mailing address, and having someone fully qualified to ship your mail anywhere in the world direct from their location.
If you need to set up a business bank account in your home country, you will likely need an Apostille from the State of Delaware. An Apostille is a certified document acknowledging that your company legally exists in Delaware. This document is issued by the Delaware Division of Corporations.
Apostilles are recognized only by specific countries, namely those that attended the international Hague Convention in 1961 and signed the so-called Apostille Treaty. For a list of which countries are a part of the Hague Convention, click here.
If your country is not a part of the Hague Convention, you will need to ask your local bank what document you will need from the State of Delaware to prove that your company exists.