Delaware Limited Liability Company (LLC)

Delaware Limited Liability Company (LLC)

GENERAL INFORMATION:

Companies incorporated in Delaware enjoy a legislative and judicial environment that encourages them to conduct business efficiently and profitably without heavy government interference. Incorporation is fast and simple. This state offers attractive tax regulations, innovative corporate laws and the existence of a chancery court system. Delaware is the second smallest state in the United States situated northeast on the Atlantic Coast and has approximately 800,000 inhabitants.

Delaware has long been considered the most popular jurisdiction for incorporation of holding companies and multinational corporations. Most of the largest 500 US Corporations are now incorporated in Delaware, which is more than all other states combined.

Highlights of Delaware Limited Liability Company

The registration for Delaware Limited Liability Company is performed at the Offices of the Secretary of State in Delaware.

The Delaware Limited Liability Company (LLC) is the latest advance in the formation of a business. The concept has its historical origins in Europe and was accepted by the Internal Revenue Service in 1997. A Delaware Limited Liability Company is a hybrid between a corporation and a partnership. The Delaware Limited Liability Company combines the corporate advantage of limited liability with flow through advantages of partnership classification.

Advantages of Delaware Limited Liability Company:

  • No citizenship requirements.
  • No limitation on type of members (*actually LLCs are limited to about 250 members).
  • No limitation on one class of shares.
  • No limitation on ownership of other corporations.
  • No tax penalties on liquidation.
  • Allows limited liability to all members including those who participate in management.

The duration of a Limited Liability Company is generally perpetual. Delaware Limited Liability Company may carry on any activity except insurance or banking.

Movement of Funds in a Delaware Limited Liability Company:

United States law requires that anyone transacting more than $10,000 into or out of the United States must report this transaction to the United States Customs Authorities. In addition the United States Internal Revenue Service must be notified of certain cash transactions in excess of US$ 10,000.

Corporate Requirements of Delaware Limited Liability Company:

  1. Name:
    The name of the Delaware Limited Liability Company must include the words Limited Liability Company, L.L.C. or LLC. The name must be distinguishable from the name of any other corporation, partnership, business, trust or Limited Liability Company organized under Delaware law or qualified to do business in Delaware unless the written consent of such other entity is obtained.
  2. Members:
    There is no minimum of members (owners) required for Delaware Limited Liability Company. These may be formed with as few as one member. Members need not be American citizens nor US residents and may be individuals, trustees, corporations or other entities, foreign or American. To add confidentiality to a structure, the members may be of corporate nature.
    The corporate identity of the Delaware Limited Liability Company is separate from that of the individual members, thus the members’ liability in respect to debts and obligations of the company are limited to their contributions to the company.
  3. Managers:
    The managers of a Delaware Limited Liability Company may be individuals or corporations of any nationality or domicile. The names of the managers may be included in the Certificate of Formation and normally indicated in the LLC Operating Agreement. The Managers may also be members of the Delaware Limited Liability Company. The Managers may make appointments as follows: President, Vice President, Secretary, etc. Resolutions may be approved anywhere in the world and are always required even if done over the phone, in order for resolutions to be approved.
  4. Capital:
    There is no minimum or maximum requirement regarding the contribution of capital for a Delaware Limited Liability Company. We recommend standard capital contribution of US$ 500/-.
    It is recommended to issue stock certificates as evidence of ownership. Units in a Delaware Limited Liability Company may not be transferred without the consent of all the rest of the members and all new members must sign the Limited Liability Operating Agreement.
  5. Registered Office:
    Delaware Limited Liability Company must have a registered office and a registered agent.
    The following words, and their associated activities, cannot be used without approval and/or licensing: Assurance, Bank, Building Society, Chamber of Commerce, Chartered, Cooperative, Empire, Imperial, Insurance, Municipal and Royal.
  6. Limited Liability Operating Agreement:
    Every LLC has a LLC Operating Agreement or Members Agreement. The agreement is a private instrument among the members or executed by the Sole Member. A standard Operating Agreement would include: the domicile, object, duration, names and details of managers and members, duties and responsibilities of the managers and members, voting rights and contributions of capital, among other important matters in the business affairs of the LLC.
  7. Books of Accounts of a Delaware Limited Liability Company:
    The books may be kept anywhere in the world. It is advisable for Delaware Limited Liability Company to register in minutes of meetings all resolutions made by the Managers and Members.
  8. Taxation of a Delaware Limited Liability Company:
    The Annual Delaware Franchise Tax for LLCs is US$300 which is payable prior to June 1st of each year. If payment is made after June 1st, the LLC will incur in a penalty of US$200 plus 1.5% monthly interest.
    The Delaware Limited Liability Company is subject to the US Tax Code based on the nature of its income, distributions, residencies of the members and any Tax Treaty provisions. For further information on taxation requirements and government filing of income tax returns in the U.S. please consult a US tax advisor.

9. Company Renewal:

Renewal of a Delaware Limited Liability Company is to be paid on anniversary date of incorporation. Failure to do so results in penalties and could result in the striking-off of the company from the Registry.

Latest valid passport copy and recent utility bill for address proof of shareholder/director are required to be submitted at every renewal as a part of enhanced due diligence. If shareholder is a corporate entity, then latest certificate of incumbency and above stated docs of directors would be required.

10. Documents Required in Setting Up a Delaware Limited Liability Company:

KYC Documents for individual Director/Shareholder:

  1. Passport – original to be verified personally in our office, otherwise client can provide an original notarized copy of the passport
  2. Proof of address (in the form of utility bill, dated less than 3 months)
  3. Bank reference (dated less than 3 months with satisfactory record clearly mentioned and also the time period the client has been dealing with the bank: minimum of 2 yrs)
  4. Detailed CV
  5. Professional reference letter (can be issued by Lawyer or Certified Public Accountant)
  6. Dully filled FATCA Form
  7. Notarized US Declaration (if a US Person)

KYC for Corporate Director/Shareholder:

  1. Certificate of Incorporation
  2. Registered address and place of business
  3. Certificate of Current Standing if incorporated more than 1 year
  4. Register of Directors
  5. Register of Shareholders
  6. Memorandum & Articles of Association

All documents of the corporate entity must be certified by a Lawyer or Certified Public Accountant

Incorporation of Delaware Limited Liability Company begins from USD 1,750/-

Global Business Services DMCC has helped many individuals and corporate entities to set up Delaware Limited Liability Company. Our Company acts as a one stop solution for Delaware Limited Liability Company incorporation services.

If you are looking for Delaware Limited Liability Company set up, please get in touch with us for professional assistance.

Whilst every effort has been made to ensure that the details contained herein are correct and up-to-date, it does not constitute legal, tax or other professional advice. We do not accept any responsibility, legal or otherwise, for any errors or omissions.

GBSOur Office
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OUR LOCATIONWhere to find us?
For company formation and company incorporation services please contact us at our mailing address:

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Plot No. F2,
Jumeirah Lakes Towers,
Post Box 309074,
Dubai (U.A.E)

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GBSOur Office
Organically grow the holistic world view of disruptive innovation via empowerment.
+971 4 4471803
OUR LOCATIONWhere to find us?
For company formation and company incorporation services please contact us at our mailing address:

Office No.12A-06,
13th floor HDS Tower,
Plot No. F2,
Jumeirah Lakes Towers,
Post Box 309074,
Dubai (U.A.E)

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GET IN TOUCHGBS Social links
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AVANTAGEHeadquarters
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OUR LOCATIONSWhere to find us?
GET IN TOUCHAvantage Social links
Taking seamless key performance indicators offline to maximise the long tail.
AVANTAGEHeadquarters
Organically grow the holistic world view of disruptive innovation via empowerment.
OUR LOCATIONSWhere to find us?
GET IN TOUCHAvantage Social links
Taking seamless key performance indicators offline to maximise the long tail.

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Copyright © 2020 Global Business Services.

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