I have been operating a couple different online storefronts (dropshipping) and want to file as an LLC to expand my brand. I currently live in an expensive (and annoying) state to do business. The cost of filing for an LLC will put me around $1,000 (at least).
I do not have employees (I'd file as a single-member LLC), I do not warehouse products, I do not package them, my web hosts are out of state, and I just work on my sites from my home or wherever I happen to be.
Do I need to file my LLC in my home state or can I file in another like Delaware?
3 Answers from Attorneys
You can file an LLC in any state, but you need to appoint an agent for service of process in that state which can cost an annual fee.
In most cases, forming an LLC in a different state than your home state is not advisable. In NY, for example, you would still have to register a Delaware LLC as a foreign company in NY (extra $), and publish the registration of the foreign company (extra $, publication of a foreign company in NY is expensive), and you would need file a tax return in Delaware (more $), and continue paying the Delaware franchise fee, agent fee and also NY's fees for as long as the LLC exits.
There are ways to mitigate the cost of formation of a NY LLC, but it is indeed around the number you mentioned. My office does LLC formations at about the same cost as online services and you will have an attorney doing it and it includes an EIN and a banking resolution.
Contact me directly
Roman R. Fichman, Esq.
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At the end of the day I doubt you'd be saving any money by using Delaware. There were more and good and valid reasons a decade ago for using Delaware; not so much anymore. Also, you want to find a lawyer who's familiar with your business model. What I'm thinking about is what address are you going to put on the form as "principal place of business"? Yours is certainly not the first of its kind for this business model; someone needs to put in the time to read up on the regulations to see where you best fit into the statutory scheme of business and tax law.
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