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Posted May 20, 2024

The Best States to Form an LLC for Privacy

For various reasons, people sometimes want to form a business while keeping their identities private. That can be accomplished by registering an anonymous LLC, sometimes called a private or confidential LLC. States that allow these types of LLCs do not publicly identify the names, addresses, or contact information for members, allowing them to shield their identities.

An entrepreneur may want an anonymous LLC to hide a business from an employer who doesn’t know the employee is planning on leaving their position, or so as not to disclose the purchase of real estate.  Some people simply don’t want their personal information floating around on Google or another search engine.

4 States that Allow Annonymous LLCs

If you’re interested in registering a private LLC, you’re limited to the states that will permit you to do so. As of May 2024, only four states: Delaware, Wyoming, New Mexico, and Nevada, allowed the formation and operation of anonymous LLCs.

1. Delaware

Delaware is known for its business-friendly environment, including the ability for anonymous LLCs. Delaware gives LLC members the right not to disclose their names or any personal information when filing their business.  Like other states, an LLC registering in Delaware does have to provide the name and address for a registered agent, which is someone designated to receive legal correspondence and other documents on its behalf. No other names, however, appear on the public record. Because of that lack of reporting, LLC members are not required to live in the state.

It’s not uncommon for an LLC to form in Delaware but operate from another state. In that case, the business is considered to operate as a domestic LLC in Delaware and a foreign LLC in other states where it does business. That means the LLC can enjoy the benefits of Delaware’s lenient privacy and tax laws while doing business elsewhere.

2. Wyoming

Like Delaware, Wyoming is known for its business-friendly climate with its policy allowing anonymous LLCs and no corporate or personal state income tax. In 2024, Wyoming ranked first in the Tax Foundation’s Business Tax Climate Index.

The Office of the Secretary of State doesn’t require the names of LLC owners or managers to be included in the Articles of Organization. And because there is no income tax for businesses or individuals, there’s no need to file any personal information with the state. Wyoming is known for its strict privacy laws, attracting many business owners who do not want their identities to be known. You’ll need to give the name of a registered agent to the Secretary of State, but no other identities are required.

3. New Mexico

Because New Mexico requires only the names of the registered agent and the LLC organizer—the person or company who files the LLC formation paperwork with the state—an LLC is anonymous by default.  The state maintains no records of management or ownership, making it an attractive option for individuals seeking anonymity. As with other states, you’ll need to name a registered agent.

4. Nevada

While Nevada currently allows for anonymous LLCs, the Secretary of State requires a list of members and managers to be submitted with the Articles of Organization. The names are not available to the public and creditors cannot access the LLC’s records, but they are known to the state. This makes Nevada less attractive to LLC members wishing to remain anonymous, as state requirements and procedures are known to change, and some individuals fear their names could be made public. Nevada also requires the name and address of a registered agent.

Before You Form an Anonymous LLC

If you’re interested in forming an anonymous LLC, you should consider which of the available states provide the degree of privacy protection you’re looking for and consider other factors, such as business laws and tax codes. A state that allows anonymous LLCs doesn’t necessarily offer the most benefits in other areas.

You’ll need to remember that LLC owners should not expect airtight identity protection, even in states that allow anonymous LLCs. The business’s Beneficial Ownership Information Report, a reporting requirement that took effect in 2024, requires that the LLC name all its members when filing the report with the Financial Crimes Enforcement Network. Also, the IRS, financial institutions, vendors, and other parties may be able to access an LLC’s owners’ information.

While there are good reasons for some LLCs to form outside of their own states, registering your business with the state where you live and are likely to conduct most of your business is usually the easiest and most cost-effective way to proceed. I’d strongly suggest you seek advice from a qualified attorney or other professional before deciding to go out of state to form an anonymous LLC.

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<a href="https://www.corpnet.com/blog/author/nellieakalp/" target="_self">Nellie Akalp</a>

Nellie Akalp

Nellie Akalp is an entrepreneur, small business expert, speaker, and mother of four amazing kids. As CEO of CorpNet.com, she has helped more than half a million entrepreneurs launch their businesses. Akalp is nationally recognized as one of the most prominent experts on small business legal matters, contributing frequently to outlets like Entrepreneur, Forbes, Huffington Post, Mashable, and Fox Small Business. A passionate entrepreneur herself, Akalp is committed to helping others take the reigns and dive into small business ownership. Through her public speaking, media appearances, and frequent blogging, she has developed a strong following within the small business community and has been honored as a Small Business Influencer Champion three years in a row.

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