Benefits of Forming an LLC in Wyoming
Wyoming is definitely an ideal state for business formation. Wyoming offers amazing asset protection benefits as well as no state taxation. LLC and even corporate laws upheld in Wyoming are very business friendly and the state does not require decision makers and stakeholders like shareholders, managers, directors and officers to physically be present at meetings or even live in Wyoming. A key protection strategy called the charging order procedure protects single member LLCs at Wyoming.
Outstanding Asset Protection
LLCs that are based in Wyoming are greatly protected against lawsuits filed by plaintiff attorneys and creditors. Unlike other states, Wyoming made laws that protects even LLC with single members.
The declaration of the names of managers and members of any LLC is not requires in the state of Wyoming even on their state public database. Privacy is highly valued by the state of Wyoming.
Can Courts from Other States Apply California Law to LLCs Under the State of Wyoming?
The protection that an owner of an LLC has greatly depends on the exact state that they incorporate with. For example, in California, the state law may use a court order in selling the assets of the LLC to benefit the creditor. Judicial dissolution is the subsequent result of the court order, at times called the corporate death penalty, which leads to the LLC’s termination.
If the LLC is established in a protection-friendly state like Wyoming, all that’s left to do is to register the business in California.
When the courts in California orders the LLC to sell the assets for the benefits of the judgment creditor. In the end, the investment or business entity is necessarily dissolved. LLCs in Wyoming cannot be ruled by California courts, this is a strong argument because generally, an LLC established in Wyoming is governed by the laws of Wyoming.
Where to Establish an LLC: Wyoming or Delaware?
Factors to Consider
At an initial glance, Wyoming and Delaware both seem like business-friendly locations. After a closer inspection and a bit of reading, one will be able to see the advantages and disadvantages of setting up a business in a specific state; these will depend on the business that one has in mind.
Forming an LLC in Wyoming is a beneficial choice, even for small business owners. The initial filing fee for setting up an LLC in Wyoming is relatively small and annual fees only add up to $50. In addition to that, LLC in Wyoming are not required to pay franchise taxes or even state income, which is an amazing benefits for small businesses.
Delaware, on the other hand, has recently increased some of their fees, which may seem like minimal to some but that minimal increase may discourage others from establishing an LLC in Delaware.