Updated August 7, 2026. Quick answer: form it where you live and operate. The advice to incorporate in Delaware, Wyoming or Nevada is aimed at a reader who does not exist in most cases — and following it usually means paying two states instead of one for exactly the same business.
The double-cost math nobody does for you
Forming in another state does not exempt you from your own. If you operate where you live, you must generally register as a foreign LLC in your home state anyway — which means two formations, two registered agents, two annual reports and two sets of fees, in perpetuity.
Put the actual numbers against it. Over five years, verified: Delaware $2,110. Nevada $1,825. Against home states like Texas $300, Minnesota $135, Wyoming $400. The full five-year table is here.
So the out-of-state strategy frequently adds a four-figure recurring cost to buy a benefit the reader has not identified. That is the whole corrective, and it takes one table to see.
Who Delaware is actually for
Delaware’s reputation is earned — for a specific reader. Its Court of Chancery is a specialised business court with a deep body of precedent, and institutional investors are used to Delaware entities and their documents. If you are raising venture capital, issuing preferred stock, or building something with a plausible exit, your investors may well require it.
If you are a consultant, a landlord with two properties, or a side business with one owner, none of that applies to you. You are buying a courthouse you will never use, and paying two states for the privilege.
The privacy argument, honestly
Wyoming and Nevada are marketed on owner privacy, and there is something to it — some states do not publish member names. But privacy from a public register is not privacy from a court, a lender, or the IRS, and the moment you register as a foreign LLC at home, your home state’s disclosure rules apply to the business operating there.
If anonymity is the actual goal, say so out loud and price it — it is a real preference, and it should be bought deliberately rather than as a side effect of a tax story that does not hold.
The rule, in one line
Form where you operate. Register elsewhere only when something concrete requires it — an investor, a specific legal need, or genuine multi-state operations. Everything else is a second annual fee bought with a hypothetical.
We do not form LLCs, sell formation services, or take a commission from anyone who does. Every route named here is either the state’s own or something you can do yourself.
See methodology and corrections. General information, not legal or tax advice. No advertising appears on this page and we earn nothing from it.
Once the state is settled, the remaining question is who does the filing — yourself, a service, or an attorney, and what each actually buys.
And forming the entity is not the same as being allowed to trade. Licensing is three separate layers — federal, state and local — and the formation filing prompts none of them, which is why the city permit is the one people discover late.