How to Set up an Anonymous LLC in Delaware

If you're an entrepreneur or small business owner who values privacy and wants the protection of your personal assets from potential legal challenges, setting up an anonymous limited liability company (LLC) in Delaware can be a great plan. An anonymous LLC in Delaware can shield your identity and that of other members of the LLC (or corporate shareholders), making it difficult for prying eyes to identify who's behind the business.

Besides complete anonymity, other core benefits of incorporating in Delaware include low taxes, minimal filing fees, favorable corporate laws and a flexible corporate structure. The First State grants you access to the most reputable corporate court — the Delaware Court of Chancery, which is well-grounded in complex business or corporate issues. 

Benzinga walks you through the steps involved in setting up an anonymous LLC in Delaware so you can focus on growing your business and worry less about unwanted attention.

What is an Anonymous LLC? 

An anonymous LLC is a limited liability company set up such that the company's ownership information is unidentifiable or hidden from the public. The name, address, contact information and other private or sensitive information of the members, managers or corporate shareholders are confidential. In an anonymous LLC, the state's Secretary of State doesn't mandate owners or members to provide their personal or private information. 

Establishing an anonymous LLC can be an excellent way to shield your identity from potential legal issues while preventing unauthorized and unwanted third parties from accessing your private and sensitive information. The implication is that opening an anonymous LLC makes it hard for cyber criminals to use your data for malicious purposes while also ensuring personal liability protection, which is fundamental to LLCs and corporations. If you're running a side business while employed, registering it as an anonymous LLC will prevent your employer from finding out about your operation. 

Landlords and real estate owners can also use anonymous LLCs to hide their actual business location and residence information from tenants. For clarity, an anonymous LLC isn't itself a distinct type of business entity or structure. Besides its enhanced privacy and confidentiality, it doesn't differ from regular LLCs from both legal and operational perspectives. Anonymous LLC is legal in only a few states in the United States. Besides Delaware, these include Wyoming, Nevada and New Mexico.  

How do Anonymous LLCs Work in Delaware? 

Usually, when starting an LLC, most states require you to provide your personally identifiable information and that of other owners or members. Furthermore, you'll need to provide your business address, the names of the LLC managers and other information. However, in Delaware, you can withhold your name or additional personally identifiable information and provide a temporary owner or nominee instead. This process enhances personal privacy, which is the cornerstone of an anonymous LLC. 

In an anonymous LLC, a nominee or a registered agent acts as the owner of the LLC and is listed as a member in public records, while the identities of the real owners remain confidential. The registered agent or nominee has no real ownership interest in the business and doesn't participate in the company management. 

They are representatives holding a legal title to the LLC on behalf of the real owners, who are still responsible for taxes and other compliance requirements. Typically, the real owners are identified in a private document like the operating agreement, which specifies the rights and responsibilities of members, profit and loss allocations and other vital business guidelines. 

5 Steps for Setting up an Anonymous LLC in Delaware

Besides the requirement for a registered agent, the setup process for an anonymous LLC in Delaware doesn't differ from that of a regular LLC. Typically, it involves the following five steps. 

Choose a Registered Agent

All anonymous LLCs in Delaware require a registered agent to serve as a contact point with the Delaware Division of Corporations. The registered agent can be a person or an entity that accepts formal business mail and legal paperwork on behalf of the LLC. For instance, if your LLC gets sued, the Service of Process goes to the registered agent. Under Delaware laws, the registered agent can be the LLC itself, a Delaware-based business or an individual resident. Either way, the registered agent must reside and have a physical address (not a P.O. Box) in the state. Suppose you're a non-resident or foreigner hoping to incorporate in Delaware. In that case, you can leverage the services of professional resident agents to represent your business. 

Fill out Articles of Organization

The next step in registering your anonymous LLC in Delaware involves filing your "Article of Organization" (or Certificate of Formation) with the Delaware Division of Corporations. You can complete the Certificate of Formation Form online and submit it via the Documents Upload Services of the Delaware Division of Corporation. Or you can download, fill and mail it to the agency at 401 Federal Street, Suite 4, Dover, Delaware 19901. Remember to include a cover memo with the certificate of formation when registering via mail or courier. Another excellent option is to set up your LLC online by leveraging the Division of Corporation's OneStop portal. 

However, you must create a user account to access the portal. If you want a hands-off approach to the entire process, you can employ the services of registered agent companies. You must provide all requisite information when filling out the documents. These include the name and address of your LLC, business purpose, name and address of your registered agent and management structure. Although the filing fee for Delaware LLC is $90, you can expedite the process by paying an additional $100 for same-day filing or $50 for the 24-hour service. An additional $50 charge applies if you wish to get a certified copy of your registration. Filing the certificate of formation formally establishes your business as a legal entity.

Obtain an EIN

Next, you need to get your Employee Identification Number (EIN), a unique numerical combination issued by the IRS to help distinguish businesses for tax purposes. An EIN is like a Social Security number (SSN) for businesses. Besides filing tax returns and employee payroll, you'll also need the EIN to open a business bank account or when applying for a company credit card. Fortunately, applying and getting your EIN is fast, free and without hassle. If you're a U.S. resident, you can apply online with your SSN and receive it in less than 30 minutes. If you're a non-U.S. resident, you must complete Form SS-4 and send it to the IRS by fax or mail. It often takes a few weeks before you can receive it. 

Prepare an Operating Agreement

Although not a mandatory requirement for establishing an anonymous LLC in Delaware, it is nevertheless recommended that your LLC have an operating agreement, especially if it's a multiple-member anonymous LLC. The operating agreement is a crucial company document outlining members' rights and responsibilities, profit and loss allocations, ownership percentage, management structure, voting rights, procedures for removing or adding members and dissolution procedures. Think of the operating agreement as a roadmap or bylaw guiding and governing the operation of the business or LLC. Single-member anonymous LLC will also find it useful when admitting new members. You can draft an operating agreement by yourself using available templates or hire an attorney to help you with it. 

Maintain Anonymity

Now that you've established an anonymous LLC, you need to take measures to maintain your anonymity. Maintaining your registered agent or nominee is one excellent way to do that. After registration, there's always that tendency to let things slide. However, you must understand that besides being a core compliance requirement, the registered agents are the public face of your LLC and helps you maintain a level of privacy by keeping your personal information off public records. 

Consider using a private mailbox service for your LLC to prevent the listing of your home address on public records. If a private mailbox isn't allowed, you should strive to have a separate address (other than your home address) for your business. Furthermore, employing the service of attorneys can be helpful as they can more easily navigate compliance while ensuring confidentiality. You can also create a series of companies with the company you legally own or you can create a blind trust and name yourself as the beneficiary. 

Enhance Your Personal Privacy and Assets Protection by Registering an Anonymous LLC in Delaware

A Delaware LLC offers numerous benefits, including personal liability protection, business-friendly laws, flexible and efficient tax obligations, fast and hassle-free filing and low setup and maintenance fees. But have you considered the possibility of enjoying near-absolute anonymity in addition to these benefits? 

Well, if you're thinking along that line or protecting your personal information is one of your top priorities, then it's time to set up an anonymous LLC in Delaware. With proper planning and attention to detail, confidentiality regarding ownership is guaranteed for you and other members once you register an anonymous LLC in Delaware. 

Frequently Asked Questions