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The Delaware Corporate Law structure does not impose restrictions on foreign ownership or management.
The only document required in order to create an LLC in Delaware is the Certificate of Formation. Unlike other states, Delaware requires very little information to be made public in order to form an LLC.
The Certificate of Formation, which is filed with the Delaware Secretary of State, has to contain only two articles: the name of the Delaware LLC and then the name and address of the Delaware LLC's Registered Office and Registered Agent in Delaware.
In Delaware, members and managers of an LLC are not required to be named on the Certificate of Formation.
Preparation, execution and filing of the Certificate of Formation must be handled by an authorized person or entity; an authorized person is an individual or entity that forms an LLC on behalf of the members by filing the necessary formation documents with the Secretary of State and returning them to the members.
Typically, the authorized person is the LLC’s Registered Agent or an attorney. Once this document is filed, the authorized person releases the LLC to the initial member(s).
The legal instrument that releases the LLC to the initial member(s) is called the Statement of the Authorized Person; this statement is prepared and signed by the Registered Agent, and it is not provided to the state of Delaware.
This information is not required to be filed publicly in Delaware.
Why would someone from outside the United States form a company in Delaware? There are numerous advantages to non-residents of the U.S.A. who form companies in Delaware.
When all of an LLC's income is Non-United States Source Income (as defined by the IRS), the members of the LLC who are not residents of the U.S.A. are typically not subject to U.S. federal income taxation.
U.S. non-residents can take advantage of Delaware’s freedom of contract and strong legal infrastructure without having to provide any member information on the public record; they can also operate their LLC anywhere in the world.
For help determining if your company earns U.S. source income, view the helpful Summary of Source Rules for Income of Nonresident Aliens provided by the IRS.
For more information or questions regarding U.S. company formations for non-residents, please feel free to call us at 1-800-345-CORP.
*Disclaimer*: Harvard Business Services, Inc. is neither a law firm nor an accounting firm and, even in cases where the author is an attorney, or a tax professional, nothing in this article constitutes legal or tax advice. This article provides general commentary on, and analysis of, the subject addressed. We strongly advise that you consult an attorney or tax professional to receive legal or tax guidance tailored to your specific circumstances. Any action taken or not taken based on this article is at your own risk. If an article cites or provides a link to third-party sources or websites, Harvard Business Services, Inc. is not responsible for and makes no representations regarding such source’s content or accuracy. Opinions expressed in this article do not necessarily reflect those of Harvard Business Services, Inc.
There are 12 comments left for U.S. Company Formations for Non-ResidentsAravind said: Tuesday, May 16, 2017
Dear Sir, I would like to know about company formation in US. Kindly advise the total cost for the complete process. Regards, AravindHBS Staff replied: Tuesday, May 16, 2017
Much of that information can be found on these two pages on our site.
If you would like more information or have questions, please feel free to Live Chat with us from our homepage or call 1-800-345-2677 during regular business hours (9-5 EST).
Seyyed Yasha Ullah Afghan said: Wednesday, September 14, 2016
Dear 1 One of our clients non-resident alien is interested in starting an online "snart watch" sales business, and has asked us to look into the necessity of opening up a USA based incorporation. 2 The clients are husband Pakistani Passport and wife US Passport but never lived in US, hence, has no tax records etc, and will most probably opt out for a Limited Partnership Company, until you may suggest a better option. 3 They also need to obtain a bank account along with a Tax ID not just for the company but also for the wife so she can enter into the tax system, which ease her process to sponsor her husband. We hope the above somewhat clarifies the requirements, please be kind and direct us accordingly in terms of documentary requirements. Warm Regards AfghanHBS Staff replied: Friday, September 16, 2016
Please call us during the hours of 9-5 EST at 1-800-345-2677or Live Chat from our website, www.delawareinc.com so that we may try to assist you.