Best States to Form an LLC for Privacy and Low Taxes
Choosing the right state for forming your LLC is crucial for business success. This guide compares LLC formation across Texas, Delaware, and Florida—focusing on formation fees, taxes, and benefits for businesses such as Amazon Wholesale, Marketing Services, and Private Label Brands.
State-by-State Comparison
Texas
- Formation Fee: $300 (Certificate of Formation)
- Annual Fees: $0 for annual report
- Franchise Tax: Yes (based on business revenue)
- State Income Tax: None
- Business Benefits: Large, diverse market — ideal for Amazon Wholesale. No income tax — great for Marketing Services. Suitable for Private Label brands due to strong consumer demand.
Delaware
- Formation Fee: $90
- Annual Franchise Tax: $300
- Annual Report Fee: $50
- State Income Tax: No tax on LLC income not sourced from Delaware
- Franchise Tax: Fixed + small additional fee based on LLC type
- Business Benefits: Strong privacy protections. Favorable legal system — perfect for Private Label requiring IP protection. Great for remote operations and cost management.
Florida
- Formation Fee: $125 (Articles of Organization)
- Annual Report Fee: $139
- State Income Tax: None
- Franchise Tax: None
- Business Benefits: Lowest overall costs. Strong privacy and minimal regulations. Well-suited for Marketing Services and Private Label businesses on a budget.
Summary & Recommendations
| State | Pros | Cons |
| Texas | No state income tax, large market, good for Amazon/Marketing | Franchise tax based on revenue |
| Delaware | Strong legal protection, privacy, ideal for IP/Private Label | Higher annual fees |
| Florida | Low cost, no franchise tax, privacy protections | Smaller market than Texas |
LLC Formation Costs & Timeline (All-Inclusive Estimate)
| Document/Service | Texas | Delaware | Florida |
| U.S. Phone Number | $20 | $20 | $20 |
| Registered Agent | $49 | $49 | $49 |
| Fax Number | $0 | $0 | $0 |
| Unique Address | $100 | $100 | $100 |
| Articles of Organization | $300 | $90 | $125 |
| EIN | $0 | $0 | $0 |
| BOI Report | $0 | $0 | $0 |
| Resale Certificate | $0 | $75 | $0 |
| Seller Permit | $0 | $0 | $0 |
| Total Estimate | $469 | $334 | $294 |
| Lead Time (Days) | 10–15 | 10–15 | 10–15 |
Key Document/Service Explanations
- U.S. Phone Number: Needed for official business communication.
- Registered Agent: Receives legal documents on your behalf.
- Fax Number: Required during EIN application.
- Physical Address: Required for state registration.
- Articles of Organization: Legal document to register your LLC.
- Address Notarization: Proves the validity of your business address.
- EIN: Employer Identification Number (for tax & banking purposes).
- BOI Report: Discloses the real owners of the business.
- Resale Certificate: Enables tax-free product purchases for resale.
- Seller Permit: Required to collect sales tax in some states.
- Business Bank Account: Keeps business finances separate.
- Website & Domain: Builds online presence and credibility.
Final Thoughts
Each state has its pros and cons, depending on your business model:
- Texas is best if you want access to a big market and don’t mind franchise taxes.
- Delaware is ideal for privacy and legal protections—perfect for Private Label brands.
- Florida offers the most affordable setup, ideal for budget-conscious startups.
📌 Need Help with LLC Formation? Book your free consultation with Empire Ecommerce today and let us help you form your LLC in the best state for your business goals.