Forming a Limited Liability Company (LLC) in the United States is a smart move for many foreign entrepreneurs and non-resident investors. However, one of the most common—and important—questions they ask is: Which state is best for non-residents to form an LLC? The answer depends on your business goals, where your customers are located, and whether or not you plan to operate physically in the U.S.
This guide explores the best states for non-resident LLC formation, including their benefits, tax policies, and key legal considerations.
Why LLCs Are Popular Among Non-Residents
LLCs offer flexibility, limited liability protection, and a relatively simple formation process. More importantly, non-U.S. citizens and residents are allowed to own LLCs in the U.S., even if they don’t live or work in the country. You don’t need a green card or a visa to start an LLC.
Some key benefits of forming an LLC in the U.S. as a non-resident include:
- Protection of personal assets
- Access to the U.S. market
- Ability to open U.S. bank accounts
- Easier partnerships with U.S.-based businesses
What Non-Residents Should Consider Before Choosing a State
When deciding where to form your LLC, consider the following:
- Formation and annual maintenance fees
- State taxes (income tax, franchise tax, etc.)
- Privacy laws
- Reputation and ease of doing business
- Whether you’ll operate physically in a specific state
If you plan to hire employees, rent office space, or serve customers in a particular state, you should form your LLC in that state. Otherwise, you may face additional registration and tax obligations.
Top States for Non-Resident LLC Formation
Here are the most commonly recommended states for non-resident LLCs:
1. Wyoming – Best Overall for Privacy and Low Fees
Wyoming is often considered the most business-friendly state for non-resident entrepreneurs.
Advantages:
- No state income tax
- Low formation fee ($100)
- Low annual report fee ($60)
- Strong privacy protections (members’ names are not publicly disclosed)
- Doesn’t require a physical presence to register
Ideal for: Digital businesses, holding companies, and e-commerce stores run from outside the U.S.
Learn more from the official Wyoming Secretary of State website
2. Delaware – Best for Legal Protection and Global Recognition
Delaware has long been favored by startups, especially those planning to raise capital or expand.
Advantages:
- Business-friendly courts (Court of Chancery)
- No sales tax
- Flexible operating agreements
- High prestige and familiarity among investors
Disadvantages:
- Annual franchise tax (minimum $300)
- Registered agent required
- Less privacy than Wyoming
Ideal for: Tech startups, companies seeking venture capital, or firms planning to scale quickly
Visit the Delaware Division of Corporations for more details.
3. New Mexico – Best for Privacy with No Annual Reports
New Mexico is a great option if you’re looking for long-term privacy and low maintenance.
Advantages:
- No annual report or annual fee
- Low formation fee (around $50)
- Strong privacy (anonymous LLCs allowed)
Disadvantages:
- Less recognized than Delaware or Wyoming
- Some banks may be less familiar with New Mexico LLCs
Ideal for: Asset protection, long-term investments, and simple operations
4. Florida – Best for E-Commerce and Physical Presence
If you’re planning to run a U.S.-based business with physical operations, Florida can be an excellent choice.
Advantages:
- No state income tax on individuals
- Strong infrastructure for online and physical business
- Business-friendly environment
Disadvantages:
- LLC member names are public
- Requires annual reports and registered agent
Ideal for: Non-residents planning to move, open offices, or operate in Florida
States You Should Avoid (in Most Cases)
While every business is different, non-residents often face unnecessary complications in states like:
- California – High fees and strict regulations (minimum $800 annual franchise tax)
- New York – High costs and publication requirement for LLCs
- Illinois – Higher fees and complex reporting
These states are better suited if you’re physically doing business there.
Do Non-Residents Need a U.S. Address?
No, you don’t need a U.S. address to form an LLC. However, you must designate a registered agent with a physical address in the state where your LLC is registered. Many services offer this for $100–$300/year.
Can a Non-Resident Open a U.S. Bank Account?
Yes, but it’s more complex than for residents. You’ll need:
- An EIN from the IRS
- LLC formation documents
- A U.S. mailing address (sometimes)
- In some cases, you’ll need to visit the U.S. in person
Some fintech companies now offer virtual business banking for non-residents, which can simplify this step.
Conclusion: Which State Should You Choose?
If you’re a non-resident with no physical business in the U.S., Wyoming is often the most affordable, private, and efficient state to form your LLC.
If you plan to seek investors or start a high-growth company, Delaware is worth the extra cost. If you want complete anonymity and no annual paperwork, New Mexico is a hidden gem.
Choose the state that aligns best with your business goals, future plans, and comfort level with U.S. compliance.