Delaware LLC: What's on Public Record?
Corporation and LLC privacy are huge drawing points for those who are planning to form a business in Delaware. Reasonably so, many people who form an LLC or corporation in Delaware want to know exactly what information is public.
Delaware LLC: Privacy & Public Information
A Delaware LLC filed through a professional Registered Agent affords you the highest level of confidentiality. When it comes to an LLC's public information, only the company name and the name and address of the Registered Agent typically appear on the Certificate of Formation, along with the date of filing and the company file number.
Here is what Delaware LLC privacy offers:
- No information about the members or managers is required to be listed on the Certificate of Formation.
- The Delaware Division of Corporations does not request, obtain or store any information regarding the LLC’s members and managers.
Your Delaware Registered Agent is required, however, to maintain a record of the contact person for the LLC, including the contact person's address. The contact person must be an actual person (not another company) who is at least 18 years of age. The contact person does not have to be a member or manager of the LLC and does not need to reside in the United States or be a United States citizen.
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In Delaware, members and managers are not required to be named in, nor to execute, the Certificate of Formation. Preparation, execution and filing of the Certificate of Formation must be handled by an authorized person or entity. This is an individual or entity that forms an LLC on behalf of the members by filing the necessary formation documents with the Delaware Secretary of State and then providing the certified documents to the members of the LLC.
The powers of the Authorized Person are merely to execute the filing of the document with the Delaware Division of Corporations. Once the document is filed, the Authorized Person delivers 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 Authorized person and is not provided to the state of Delaware. It is not required to be filed in Delaware public records.
What about Information on Payment Method?
After the initial formation, a Franchise Tax of $300 for the prior year's Franchise Tax is required to be paid on or before June 1 of each year. If the Franchise Tax is not paid on time, a $200 penalty is assessed on June 2, and interest is assessed immediately.
All Franchise Tax payments show up on the Delaware public records, including the date and amount of each payment. If you pay your Franchise Tax on the state's website, the state will then have a record of the transaction, including the credit card number used.
However, if we are your Registered Agent and you take advantage of our service to pay the Franchise Tax through our website, your credit card number will not appear on the Delaware public records, since we pay many companies' Franchise Taxes in bulk payments via our direct deposit account with the state of Delaware. Again, in this case, neither your member nor your management data will appear on any Delaware public records.
For Delaware LLCs formed and maintained through Harvard Business Services, Inc., the state of Delaware's public record will, therefore, contain no information about your LLC's members and/or managers. 100% of your Delaware LLC is not on the public record, making Delaware one of the best states for LLC privacy.
When and Why Ownership Information May Become Public
Although Delaware does not require LLC owners or managers to be listed in public formation records, ownership information can still become public in certain legal or transactional situations. Let’s review some of the most common scenarios.
- Court Proceedings and Litigation
If a Delaware LLC is involved in a lawsuit, ownership details may be disclosed in court filings, discovery documents, or judicial opinions. Once filed with the court, these records are generally public unless sealed. Some of the most common triggers include contract disputes, member lawsuits, and fraud claims.
- Bankruptcy Filings
When an LLC or its owners file for bankruptcy, federal bankruptcy law requires extensive financial disclosures, which can include:
- Names of members or controlling persons
- Ownership percentages
- Related entities
Bankruptcy records are generally public and searchable through federal court systems.
- Government Investigations
State or federal agencies may require disclosure of LLC ownership during certain government investigations. This may occur when a government agency is investigating tax compliance, fraud, or securities violations. While the investigations themselves are confidential, ownership details often become public if settlements or court cases follow.
- Business Licensing and Permits
Certain industries require disclosure of owners or controlling persons as part of state or local business licenses. These disclosures may become public depending on the issuing authority.
- Voluntary Disclosure
If you so choose, ownership information can also become public at your own discretion. It’s relatively common for an LLC to list its members on its website, in a press release, or in other marketing materials.
How can an LLC member prove ownership if the public record doesn't contain names?
The fundamental terms of an LLC's ownership, operation and management are set forth in an LLC Operating Agreement. An LLC Operating Agreement can be a written document or merely an oral understanding.
A written Operating Agreement, however, is typically used because it memorializes the understanding and agreements of the members which, in the event of a later dispute, misunderstanding, litigation or death, is an invaluable protection for all parties involved.
Although each LLC Operating Agreement is different, an LLC Operating Agreement generally sets forth certain fundamental terms, such as:
- The ownership percentage of each member
- The manner in which profits, losses and expenses are allocated
- The authority of members to bind the LLC and participate in day-to-day management
- The voting rights of each member in making key decisions
- The circumstances under which a member may withdraw from the LLC, and the way in which the member’s economic interest is calculated upon withdrawal
- The ability of a member to sell or pledge his/her interest to a third party
- Terms contemplating the death or disability of a member
- The circumstances and terms under which new members may be admitted
- The circumstances under which the LLC will be liquidated, and the priority of claims among the members upon liquidation
- Indemnification rights (if any) in the event the LLC or member is sued in connection with the LLC's business
Delaware does not require an LLC Operating Agreement to be filed or added to the Delaware public records.
Privacy Issues Across Jurisdictions
While Delaware limits ownership disclosure at the state-filing level, operating across state or national borders often subjects an LLC to very different transparency rules. For starters, when a Delaware LLC registers to do business (foreign qualifies) in another state, that state may require the disclosure of members or managers. Certain states prioritize transparency over privacy, meaning information shielded at formation can become public elsewhere.
Furthermore, if a Delaware LLC operates in regulated industries, such as construction, financial services, healthcare, or cannabis, other states may require disclosure of owners or controlling persons. These disclosures are often governed by local law, not Delaware law. Operating or holding accounts outside the U.S. can have similar results.
Just remember that Delaware’s privacy benefits apply primarily within Delaware. Once an LLC operates, owns property, hires employees, or is regulated elsewhere, it becomes subject to the disclosure rules of those jurisdictions, which may be significantly less protective.
Delaware Corporation: What is on Public Record?
Corporations can also be filed in Delaware through a Registered Agent without listing shareholders, directors or officers on the public record.
However, after the initial filing, every Delaware corporation is required to file a Franchise Tax report on or before March 1 of each year and, in doing so, must list the names and addresses of the company's directors and one officer.
This information is required even if your Delaware Registered Agent pays your Franchise Taxes for you. Therefore, this information will be in the Delaware public records and may be obtained by anyone requesting it from the Delaware Division of Corporations (for a $10 payment). Some states post this information on their websites, but Delaware does not.
LLC & Corporation Public Records
When self-filing either type of entity directly with the Delaware Division of Corporations, individuals are required to list their name and address as the incorporator of the company on the formation documents.
These documents can be viewed on the Delaware public record from the first day the company is formed and will remain on the Delaware public record for the life of the company.
Privacy and confidentiality regarding the public record should not be mistaken for invisibility in the eyes of the authorities, should fraud occur and be discovered. The Delaware Attorney General's Office is diligent in punishing the fraudulent use of Delaware companies.
The necessity of possessing the ability to shield a company's ownership from public records plays a valid role in today's business world. Business is very competitive by nature, and the element of confidentiality can be crucial in many perfectly legitimate business transactions that would not happen without strict confidentiality.
As one of the best states for LLC privacy, you can form a Delaware LLC on our website by following the link below.
Get answers for all your business needs
Not sure what’s right for your company? Speak directly with our specialists and get clarity before you make your next move.
Talk to an expert*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.
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There are 9 comments left for Delaware LLC: What's on Public Record?
M S Mohideen said: Saturday, November 30, 2019Do I have to provide a credit card authorization in order to register a Delaware LLC?
HBS Staff replied: Tuesday, December 3, 2019If you incorporate through Harvard Business Services, you can pay us via credit card, check, or Paypal. We then pay the state of Delaware from our own account.
Diego said: Wednesday, November 6, 2019So if you contact the Delaware Division of Corporations and someone pays usd 10, they will be informed about the directors ? This point is not clear at all for me., Thank you.
HBS Staff replied: Thursday, November 7, 2019Yes, after the corporation's first annual report and franchise tax payment (March 1st of the year following the year of incorporation), the report (containing the corporation's directors' information) will be available for purchase by the public. This applies to Delaware corporations but not Delaware LLCs.
Julianne Fox said: Thursday, July 18, 2019We formed our Delaware LLC with Harvard Business Services, and are happy with the privacy policy afforded to us personally. However, after formation, we filed for our EIN and had to give the IRS my name as the contact person and manager of the LLC, and EIN's are "public record". My question: is my persnal name/privacy revealed by the IRS?. If someone calls the IRS or searches an on-line database for our company name or by our EIN, will my personal name be given with the information? Thank you.
HBS Staff replied: Monday, July 22, 2019Julianne, the information provided for the EIN is for the IRS use only and it’s not public record. It’s confidential and the IRS will not release any information to a third party without an authorization from the responsible party/owner listed on the account with them and it’s not posted on the IRS website.
ghekiere dirk said: Wednesday, November 22, 2017we have a joint venture in the usa, a delaware llc. We invested a lot of money but the CEO of the company refuse to send us financial information, balance sheets etc.. The question is where can we find financial reports of a delaware company?
HBS Staff replied: Monday, November 27, 2017Unless the LLC is operating in the state of Delaware, the financial information would not be listed publically anywhere. You will have to ask the CEO or corporate secretary to provide you with the information.
If the company is operating in Delaware, you can contact the Delaware Division of Revenue, since that is where a Delaware business license would have obtained. Hope this information helps in some way.
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