8. Seven major benefits/advantages of Delaware, USA LLC
With minimal start-up requirements, simple maintenance and the ability for members to establish their own company structures and rules, the Delaware LLC is the most flexible type of business entity offered by any state or country in the world
Below are seven of the significant benefits of a standard Delaware LLC:
Advantage # 1: Custom LLC Business Structure and Rules
This means the terms and rules of each LLC can be tailored to accommodate the specific needs and preferences of an LLC. This is the biggest benefit of an LLC over any other form of business entity. This power is called freedom of contract.
Advantage # 2: Asset Protection Against Creditors
Delaware LLCs possess increased asset protection against creditors. This means that if a member of an LLC has a judgment filed against him/her, a creditor cannot attack the LLC nor acquire any portion of the LLC's assets. This benefit protects everyone in the company
Advantage # 3: Statuary Limitation on Member Personal Liability
A statutory limitation on the personal liability of the members of an LLC means that members are not held liable for repayment if an LLC fails and leaves behind debt. They just lose the amount of dollar they invested in the LLC.
Advantage # 4: Delaware LLC tax benefits - Treatment by the IRS
When an LLC is formed, the owners can choose whether they want the LLC to be taxed as a partnership, an S corporation, a C corporation or a sole proprietorship. Single-member LLCs are not recognized by the IRS and therefore pay no taxes at all.
Advantage # 5: Simple Start-Up and Minimal Requirements
Very little information is required to form an LLC in Delaware, and start-up involves only a small filing fee. Additionally, there are no meetings or voting requirements.
Advantage # 6: Low Annual Fees and Simple Maintenance
The cost to maintain a Delaware LLC is simple and inexpensive. Once a year, a simple form and an annual Franchise Tax Fee of $300 must be filed with the Delaware Secretary of State, and a Registered Agent Fee must be paid annually, as all Delaware LLCs are required by law to have a Registered Agent to accept service of process.
Advantage # 7: Delaware LLC Privacy
You are not required to disclose any information about the owner of an LLC to the state of Delaware in order to form or maintain an LLC. In Delaware, you are required only to have a designated contact person and a Delaware Registered Agent.