US Company Formation: Delaware vs Wyoming vs Your Operating State
Foreign nationals can own 100% of a US LLC or corporation, with no citizenship or residency requirement. The state you pick matters more than the tax rate you’re quoted — the formation state only governs your entity’s internal law.
What You Need to Know
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Delaware
The standard investors expect if you’re planning to raise institutional funding — its legal system and case law are what US VCs are used to.
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Wyoming
Often cheaper to maintain, a common choice with no immediate fundraising plan.
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Your operating state
If you operate primarily in one specific state, forming there directly can sometimes be simpler than a separate formation state plus foreign-qualification paperwork.
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The part people miss
A foreign-owned single-member LLC that is disregarded for tax purposes still has an annual US information-reporting obligation (Form 5472, filed with a pro forma Form 1120) — even with no US tax liability. Nexus in the states where you actually operate, franchise tax in the formation state, and federal filing obligations all apply independently of where you incorporated.
Before You Move Forward
- Decide based on your fundraising plans, not just setup cost.
- Identify every state where you have real operating nexus, not just your formation state.
- Confirm your Form 5472 obligation applies even if the LLC owes no US tax.
See the Full United States Picture
This guide is one slice of the United States page — structure options, tax snapshot, and the full compliance calendar live there.