May 30, 2024

How to Form an Anonymous LLC

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If you value online privacy and asset protection, forming an anonymous LLC could be the solution. Here's how to do it.

States often require LLC owners to reveal their private information to the public. But you can work around this by forming an anonymous LLC.

It can be simple to do so, but only a few states let you form an anonymous LLC. Plus, you have to prepare an extra budget. You'll find out everything you need to know in this article.

How familiar are you with the steps and requirements of forming an LLC?

Steps to Form an Anonymous LLC

Forming an anonymous LLC is not so different from forming a regular LLC. The biggest difference is what information you include (or don't) on the Articles of Organization.

Here are the steps to get started.

How do I make my LLC anonymous?
To make your LLC anonymous, you must first form it in a state that permits anonymous LLCs, namely, Delaware, New Mexico, or Wyoming. Then, hire a registered agent or an attorney to act as the LLC's point of contact.

Select a state that allows anonymous LLCs

There are only a few states where you can form an anonymous LLC: Delaware, New Mexico, and Wyoming. This doesn't mean you have to live in these states. You just need a registered agent with a physical street address in these states.

The state where your LLC is legally formed and recognized becomes its "home state" or "domestic state." Before deciding where to form an anonymous LLC, think about how this will impact your business finances and operations.

For example, take note of the regulations that could impact your business, required permits, taxes, and annual fees.

Nevada no longer allows the formation of anonymous LLCs.
You might have read somewhere that Nevada allows the formation of anonymous LLCs. However, this information is outdated. Nevada's Articles of Organization now require ownership information.

Name your LLC

You'll be asked your desired business name no matter which state you choose to form an anonymous LLC. Conduct a business name search through the state's database to check whether your business name is available in that state.

Additionally, review the state's naming regulations to prevent your application from getting rejected. All states require business names to end with some version of "Limited Liability Company" or "L.L.C." to indicate it's an LLC.

That said, an anonymous LLC is also called:

  • Confidential LLC
  • Secret LLC
  • Private LLC
  • Ghost LLC

These terms are often used interchangeably.

Reserve your desired business name.
If you aren't ready to form your LLC, you can reserve your desired business name first. Paying the state's name reservation fee will prevent others from using that name for 30 to 180 days.

But naming your LLC without reserving it has no additional cost. It's included with the LLC formation filing fee.

Appoint a Registered Agent

Delaware, New Mexico, and Wyoming require LLCs to have a registered agent. A registered agent will receive your business and legal documents for you.

To keep your LLC anonymous, you can hire a registered agent service or an attorney. Being your own registered agent will defeat the purpose of starting an anonymous LLC since your details will be put in the Articles of Organization.

That said, not all registered agent services can help you form an anonymous LLC. You can check out Northwest Registered Agent (125/yr.) to start.

Will hiring a registered agent automatically make my LLC an anonymous LLC? Hiring a registered agent will not automatically make your LLC anonymous. You must form an LLC in a state that allows anonymous LLCs. Then, use your registered agent's name and address for all public forms.

File the Articles of Organization

Your LLC's formation documents are commonly called the Articles of Organization. It contains important information about your LLC, and may include your:

  • LLC name and business address
  • LLC organizer's name and contact details
  • Registered agent's name and address
  • Business purpose

Some states also ask if the LLC is member- or manager-managed. Manager-managed structures can give more privacy since only the name of the manager is shown in public records.

You'll submit these documents to the Secretary of State, together with the filing fee.

Is a series LLC also an anonymous LLC?
A series LLC and an anonymous LLC are not automatically the same thing. A series LLC is a special type of LLC structure. It has a main "parent" LLC that can create separate "series" within itself. Each series can hold its assets, contracts, and business activities.

However, you can form an anonymous series LLC in Delaware. This would offer both asset protection through the series structure and privacy of ownership.

Get an EIN

An Employer Identification Number (EIN) is a unique nine-digit number assigned by the Internal Revenue Service (IRS). This number is used to:

Applying online is the fastest and easiest way for most applicants. Visit the IRS website and use their Business Taxpayer Identification Number (TIN) Matching Application.

Once you enter all the required information about your business and yourself, you'll receive your EIN immediately for free.

Even for anonymous LLCs, the IRS still needs to know the identity of the responsible party. This could be the appointed manager (registered agent or attorney) of your LLC.

File a BOI

The Beneficial Ownership Information (BOI) report is a requirement by the Corporate Transparency Act of 2021. It's submitted to the Financial Crimes Enforcement Network.

It includes information about the LLC's beneficial owners, including name, birth date, and address. Don't worry, this information won't be disclosed to the public.[1]

You are considered a beneficial owner if you own 25% or more of the ownership interests in your LLC. Or if you exercise substantial control over the LLC.

BOI Report Due Dates:
The due date depends on when your LLC was formed.[1]

LLC Formation DateBOI Report Due Date
Before January 1, 2024January 1, 2025
On or after January 1, 2024Within 90 days after the date your LLC was formed
On or after January 5, 2025Within 30 days of company formation

Will submitting a BOI report remove my LLC's anonymity?
Not necessarily. The BOI report is not available to the public. The data is used primarily for law enforcement investigations.

Get Business Permits and Licenses

Before offering your products and services to the public, you must first get the permits and licenses required for your business.

Delaware has a state business license for any person or entity that does business in the state, including anonymous LLCs. The annual fee for the state business license varies, but it typically costs $75 for a first location.[2]

In contrast, Wyoming and New Mexico don't have a general business license at the state level. But of course, you must check business licensing requirements with local jurisdictions and specific industries.

Also, the number of permits and licenses your LLC needs depends on its business purpose. Some businesses may be regulated simultaneously by various governmental offices, racking up total costs of over $1,000.

Does my anonymous LLC need to pay tax?
LLCs aren't exempt from paying tax just because they're anonymous. Unless your LLC has a valid tax exemption, you must pay the federal and state income tax and sales taxes, among other taxes.

Open a Business Bank Account

Using a personal bank account for your anonymous LLC's transactions renders the anonymity factor useless.

Also, LLCs provide limited liability protection, so personal assets (like your home and car) are protected from business debts and liabilities. Mixing personal and business finances in one bank account can weaken this shield.

Although business bank accounts generally require a business owner's personal information, some banks don't if you're an anonymous LLC. You just need to present the following, among other documents:

Have a Certificate of Good Standing on hand.
You can get a Certificate of Good Standing from the state to prove that your LLC is legal, active, and in good standing with the state. You might need it when opening a bank account or applying for a loan.

What's an Anonymous LLC?

A limited liability company is considered anonymous when the names and details of its real owners are not available to the public.

There are many reasons why you'd want this. For example, you could be:

  • An entrepreneur who's a public figure or celebrity
  • An employee who wants to start a side business
  • A business owner who wants to keep real estate purchases confidential

You can hide your identity by hiring a registered agent or attorney. Their name, address, email, contact number, and other details will be shown on public records instead of yours.

What's the difference between an LLC and an anonymous LLC?
The difference between an LLC and an anonymous LLC is that the latter's real owners are not made public. Even if you search through a government's public database, you won't be able to find any information about the owners.

What's your primary reason for considering an anonymous LLC?

Pros and Cons of an Anonymous LLC

Anonymous LLCs are legal in the United States because they offer some benefits to the real owners.

Benefits:

  • Keeps personal information away from the public
  • Helps LLC owners avoid frivolous litigation
  • Helps keep your investments and assets private
  • Strengthens the distinction between your personal and business assets

That said, like other business entities, an anonymous LLC is not all sunshine and roses. It has some downsides too.

Downsides:

  • Additional cost for registered agent and/or legal services
  • Third parties, like the appointed manager or registered agent, may be subject to lawsuits
  • May be subject to more complex rules compared to a regular LLC

Additionally, an anonymous LLC may not be suitable for all businesses. For example, some industries are regulated heavily by the government, thus impacting the LLC's level of privacy.

Forming an anonymous LLC is a serious decision with significant repercussions. You should analyze the trade-offs between privacy, cost, and potential business obstacles.

Where Can I Form an Anonymous LLC?

Most states require the names, and sometimes other details, of the LLC's members to be disclosed to the public. Only Delaware, New Mexico, and Wyoming allow the formation of anonymous LLCs.

Fortunately, you don't need to live in these states to form an anonymous LLC.

Anonymous LLCs are not illegal.
Delaware, New Mexico, and Wyoming allow the formation of anonymous LLCs. These states don't require the real owners' information to be disclosed to the public. But an anonymous LLC must never be used for illegal activity.

Delaware Anonymous LLC

Delaware has a well-earned reputation as both a tax haven and a state with business-friendly laws.

For example, Delaware has no state sales tax and has a low state income tax compared to other states.[3]

To form an anonymous LLC in Delaware, complete the Certificate of Formation with the following information:[4]

  • LLC name
  • Registered agent's name
  • Registered office address

Delaware has a Court of Chancery that focuses exclusively on corporate law disputes. If your anonymous LLC ends up in a legal dispute, there will be no juries—only chancellors (judges), who are experts in business law.[5]

Delaware also allows series LLCs.
A series LLC has a main "parent" LLC that can create separate "series" within itself. Each series can hold its assets, contracts, and business activities.[6]

The main benefit here is debts and legal issues of one series generally don't affect the other series or the parent LLC.

New Mexico Anonymous LLC

New Mexico allows the formation of anonymous LLCs, with a relatively low LLC formation fee compared to other states.

To form an anonymous LLC in New Mexico, you only need to provide the following in the Articles of Organization:

  • LLC name
  • Business duration (perpetual if there is no end date)
  • Registered agent name and address
  • Member- or manager-managed LLC
  • The LLC's effectivity or formation date (optional)

Unlike most states, New Mexico does not require LLC owners to submit annual or biennial reports. This means you won't have to update LLC ownership information with the state.

Member-managed vs. Manager-managed LLC
An LLC is member-managed if all members share management responsibilities. Meanwhile, a manager-managed LLC typically means a designated person handles daily operations.

LLCs can choose either structure. Just note that member-managed LLCs often require listing all members' names and addresses on the Articles of Organization. This makes ownership details public.

Wyoming Anonymous LLC

Wyoming is another good state to consider for anyone who wants to form an anonymous LLC. Here is the following information required by the Articles of Organization:[7]

  • LLC name and address
  • LLC organizer's name and contact details
  • Registered agent's name and physical address
  • Signed Consent to Appointment by Registered Agent form

A registered agent and an LLC organizer have different roles. A registered agent serves as the LLC's point of contact and receives important documents. Meanwhile, an LLC organizer handles the paperwork to form the LLC.

Some registered agent service offer to be the LLC Organizer to help you remain anonymous. But you can choose a different person to be the LLC organizer.

Close LLC: To tick or not to tick?
When filling up the Articles of Organization, you have the option to tick a checkbox that allows your LLC to be a Close LLC.[7] What this means is that existing members cannot sell their shares of the business to just anyone else. It's ideal for family-owned businesses. In that case, the choice to form a Close LLC should be discussed between you and other members.

What is a Double LLC Strategy?

A double LLC strategy helps create anonymity for your LLCs, even in states without anonymous registration.

Here's how to do it:

  1. Form an anonymous LLC in a state that allows it.
    Delaware, New Mexico, and Wyoming allow the formation of anonymous LLCs. The LLC you form won't conduct business directly. Its purpose is to own the second LLC.

  2. Form a second LLC.
    Once your anonymous LLC is formed, form a second LLC in the state where you want to do business.

    Use the anonymous LLC as the sole owner of the second LLC. Since the former was formed in an anonymous state, its ownership information would be protected.

Consult with a lawyer before forming an anonymous double LLC.
Managing two LLCs comes with extra administrative burdens and costs. There may be additional or more complex steps depending on the state where you want to form a second LLC.

Bottom Line

Whether you're a public figure or a business owner who wants to keep your identity private, an anonymous LLC could be your strategic ally.

You can form one in a state that allows anonymous LLCs, then hire a registered agent or attorney to protect your personal details. Alternatively, try a double LLC strategy.

That said, carefully consider whether the pros outweigh the cons. Don't forget that rules are always evolving, so perpetual anonymity is never assured. Stay one step ahead by seeking professional guidance and keeping updated with the law.

What's the most challenging step when forming an anonymous LLC?

References

  1. ^ Financial Crimes Enforcement Network. Beneficial Ownership Information Reporting, Retrieved 02/29/2024
  2. ^ Delaware Division of Revenue. Step 2: Requirements for Delaware Businesses, Retrieved 02/29/2024
  3. ^ Delaware Division of Revenue. Doing Business in Delaware, Retrieved 05/04/2024
  4. ^ Delaware Division of Corporations. Certificate of Formation of a Limited Liability Company, Retrieved 02/28/2024
  5. ^ Delaware Courts. Judicial Officers, Retrieved 03/11/2024
  6. ^ The Delaware Code Online. Chapter 18. Limited Liability Company Act, Retrieved 03/11/2024
  7. ^ Wyoming Secretary of State. Limited Liability Company Instructions, Retrieved 02/28/2024

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