Delaware vs Wyoming vs New Mexico LLC for Non-Residents
These are the three states non-residents form LLCs in most often, and they sit at very different price points. New Mexico is the cheapest and most private. Wyoming is the low-cost workhorse. Delaware is the expensive one that's only worth it for a specific plan. Here's the honest comparison, with real 2026 numbers.
Why these three states, and why cost decides it
A US-based founder usually forms an LLC in the state where they live and operate. A non-resident has no US home state and, in the typical e-commerce case, no physical US presence either — so the usual tiebreaker disappears and you're free to choose on the things that actually matter to a remote owner: cost, upkeep, and privacy. That freedom is exactly why New Mexico, Wyoming, and Delaware dominate the conversation. None of them requires you to live or operate there; all three are "form-from-anywhere" states. The differences that remain are almost entirely about money and maintenance, which is a far more useful lens than the "best state to incorporate" mythology written for venture-backed US startups.
New Mexico: cheapest, and no annual report
New Mexico is the quiet value pick. As of 2026, the filing fee to form an LLC is about $50, and — the feature that sets it apart — New Mexico does not require an annual report or an annual state renewal fee. Once you're formed, the state doesn't bill you each year to stay in good standing, which is genuinely unusual. New Mexico also doesn't publish member or manager names in its public formation record, giving it a privacy edge. For a lean, single-member online business that wants the lowest possible recurring state cost, New Mexico is hard to beat. The one thing to keep in mind: you still need a registered agent in the state, and that service carries its own yearly cost even though the state's own fee is zero.
Wyoming: the low-cost workhorse
Wyoming is the state most non-resident founders land on, and for good reason. As of 2026, forming costs about $100, and the annual report fee is roughly $60 per year for a small entity with no significant Wyoming-based assets. There's no state income tax, the paperwork is minimal, and Wyoming has a long, well-understood track record with foreign-owned LLCs, plus solid privacy. It costs a little more than New Mexico each year, but many founders happily pay the difference for Wyoming's familiarity and its reputation among banks and payment providers, who see Wyoming LLCs constantly. If you want the "boring, proven default," this is it — the same conclusion we reach in our broader look at the best state for a non-resident LLC.
Delaware: pay the premium only for a reason
Delaware has enormous brand recognition, which leads many founders to assume it's the "serious" choice. For most non-resident e-commerce sellers, it isn't the best fit. As of 2026, Delaware's LLC formation fee is around $110, and — critically — it charges a flat $300 annual franchise tax on every LLC, several times Wyoming's yearly cost and infinitely more than New Mexico's zero. What that premium buys is legal familiarity: Delaware's courts and corporate statutes are what venture-capital investors and their lawyers know cold. That familiarity is worth real money if you plan to raise VC, take on sophisticated investors, or convert to a C-corporation. If that's your path, Delaware's cost is justified. If you're running a store rather than building a fundable startup, you're paying extra for prestige you'll never use — the same trade-off explored in LLC vs C-corp.
The numbers, side by side
Formation is a one-time cost; the recurring cost is what adds up. Here's the state's own fee to form, as of 2026 (registered-agent service is separate and typically runs about $50–$150 per year wherever you form):
| State | Formation fee | Recurring state fee | Annual report? |
|---|---|---|---|
| New Mexico | ~$50 | $0 | None |
| Wyoming | ~$100 | ~$60/yr | Yes (annual) |
| Delaware | ~$110 | $300/yr franchise tax | No report; flat tax instead |
Now the number that actually decides it — the year-two total of state costs once you're up and running, assuming a registered-agent service of about $100/year for comparability:
| State | Year-one (form + agent) | Year-two onward (state + agent) |
|---|---|---|
| New Mexico | ~$150 | ~$100 |
| Wyoming | ~$200 | ~$160 |
| Delaware | ~$210 | ~$400 |
The gap is real but modest in absolute terms — a few hundred dollars a year separates the cheapest from the most expensive. That's worth noting because it means the state decision, while worth getting right, is not where the big money or the big risk lives. Those sit in the federal filings, which cost the same no matter which state you pick.
What none of these states changes
This is the part that the "cheapest state" content skips, and it's the part that matters most. Whichever of the three you choose, a foreign-owned single-member LLC still needs an EIN, still needs a registered agent in its state of formation, and still files a federal Form 5472 with a pro-forma 1120 every single year — even with zero activity, and regardless of state. Miss that federal filing and the penalty starts at $25,000, which dwarfs any state fee difference; our complete guide to the Form 5472 penalty covers how that works. Sales tax is likewise unaffected by your formation state: it turns on where you have nexus, and for marketplace sales the platform now collects it for you. Forming in a "no-tax" state neither creates nor removes any of this.
One practical warning: picking wrong isn't a catastrophe, but fixing it isn't free. Moving an LLC to another state later, or registering an out-of-state LLC to do business where you actually operate, means more filings and more fees. It's cheaper to choose deliberately once than to redo it — another argument for a low-cost default rather than a state chosen on reputation.
Frequently asked questions
Which is cheapest overall?
New Mexico, because of its roughly $50 formation fee and its lack of any annual report or state renewal fee. Wyoming is close behind and preferred by founders who value its track record with banks. Delaware is the most expensive because of the $300 annual franchise tax.
Is New Mexico's "no annual report" a catch?
No catch, but keep it in perspective. The state genuinely doesn't require an annual report or fee. You still pay for a registered agent each year, and — far more importantly — you still owe every federal filing. New Mexico saves you the state line item, not the federal ones.
I've heard Delaware is the "professional" choice. Is that wrong?
It's right for the wrong audience. Delaware is the professional choice for companies raising venture capital or converting to a C-corp, because investors trust its legal system. For a self-funded online store run from abroad, that advantage never comes into play.
Can I compare the full running cost, not just state fees?
Yes — our US company cost calculator combines formation, registered agent, banking, and compliance so you see the real annual number, and annual LLC costs by state breaks down the recurring side across more states.
How we help you choose
The state is a small decision that people overthink and platforms oversell. We match it to your real plan — New Mexico or Wyoming for a straightforward online seller who wants the lowest cost and good privacy, Delaware only when you're genuinely on a venture path — and then handle the parts that actually carry risk: the EIN, the registered agent, and the annual federal filings that cost the same everywhere. It's part of our US market-entry work and our e-commerce practice. If you're deciding where to form, talk to us first.