If you decide to form a US LLC, the first question is which state to use, and Wyoming vs Delaware is the debate you will see most often, with New Mexico as the low-cost alternative. The differences in fees, privacy and reputation are real, but for a non-US owner living in Spain, the state matters less than the tax and compliance setup around it.
The short answer: Wyoming offers low annual costs and strong privacy features; Delaware has a long reputation, a well-developed body of company law and a higher annual tax; New Mexico has very low ongoing costs and no annual report requirement. For most single-owner freelancers, the choice is between Wyoming and New Mexico for cost and Delaware for investor-oriented businesses.
State fees, filing rules and privacy options change. The figures below are indicative and must be verified on each state’s official website before you decide. This guide is general information, not legal or tax advice.
Key takeaways: Wyoming vs Delaware
- Wyoming vs Delaware: Wyoming is cheaper each year; Delaware has the stronger investor-facing reputation.
- New Mexico has low formation costs and no annual report requirement.
- The state of formation does not change your Spanish tax position.
- You need a registered agent in the state you choose.
- Verify current fees on the official state sites before you form the LLC.
In this guide
- Key takeaways: Wyoming vs Delaware
- Wyoming vs Delaware vs New Mexico at a glance
- Wyoming vs Delaware: cost and reputation
- New Mexico: the lowest ongoing cost
- Which state should a freelancer choose?
- What the state does not change
- Registered agent, EIN and next steps
- Common mistakes when choosing a state
- Frequently asked questions about Wyoming vs Delaware
- Final thoughts on Wyoming vs Delaware
- Sources and further reading
- Related guides
Wyoming vs Delaware vs New Mexico at a glance
| Feature | Wyoming | Delaware | New Mexico |
|---|---|---|---|
| Formation fee (state) | Low, about €100 equivalent | Moderate | Low, about €50 equivalent |
| Annual cost | Annual report with a modest minimum license tax | Annual tax for LLCs of a fixed amount, notably higher than Wyoming | No annual report or annual state fee |
| Privacy | Owners are generally not listed in public filings | Owners are generally not listed in public filings | Owners are generally not listed in public filings |
| Reputation | Well regarded for small businesses | Preferred by investors and larger companies | Less known, sometimes questioned by banks |
| State income tax for LLCs without local business | None | None for non-resident LLCs without local business | Rules apply if the LLC operates in the state |
These are broad points. Check each state’s current fees and rules before you form the LLC. The cost of a service provider is separate.
Wyoming vs Delaware: cost and reputation
Wyoming has a reputation for low annual fees and a simple, business-friendly system. Delaware is the default for companies that plan to raise venture capital, issue shares and use sophisticated legal documents, thanks to its well-developed corporate law and courts. For a freelancer, those advantages rarely matter, while the higher annual fee does. If you do not plan to raise investment, Delaware is often an unnecessary expense.
New Mexico: the lowest ongoing cost
New Mexico has low formation fees and no annual report requirement for LLCs, which makes it popular with freelancers who want to keep costs low. Some banks and platforms are less familiar with it, so check compatibility with the payment providers you plan to use. See LLC bank account without living in the US.
Which state should a freelancer choose?
- Define your goal: a payment structure for US clients, a software business or a company for investors.
- Check your payment provider and bank: some prefer or require certain states.
- Compare total yearly cost: state fees, registered agent and compliance.
- Consider your tax advice: the tax result in Spain does not depend on the state, but the paperwork does.
- Decide: Wyoming or New Mexico for a simple low-cost freelance LLC; Delaware for investor-oriented plans.
What the state does not change
Whatever state you choose, you remain a Spanish tax resident if you live and work in Spain. The state does not change the Spanish treatment of the LLC’s profits, the US filing duties of a foreign-owned LLC or the reporting of foreign accounts in Spain. Read LLC taxation in Spain for resident owners and LLC for freelancers in Spain: pros, cons and costs.
Registered agent, EIN and next steps
Every LLC needs a registered agent in its state and, for most uses, an EIN from the IRS. Learn how they work in registered agent and EIN explained. If you want help with the process, compare providers in LLC formation services from Spain.
Common mistakes when choosing a state
- Choosing Delaware only because of its fame.
- Choosing the cheapest state without checking bank and platform compatibility.
- Believing the state changes your Spanish tax.
- Ignoring annual deadlines, which can cause the LLC to lose good standing.
- Not checking current fees before paying.
Frequently asked questions about Wyoming vs Delaware
Which is cheaper, Wyoming or Delaware?
Wyoming usually has lower annual costs. Delaware charges a higher annual tax for LLCs. Check current fees on the official sites.
Is New Mexico a good choice for an LLC?
It has low formation costs and no annual report requirement, which suits many freelancers. Check bank and platform compatibility.
Does the state change my taxes in Spain?
No. As a Spanish tax resident, your tax position depends on Spanish rules and your facts, not on the state of formation.
Do I need a registered agent?
Yes. Each LLC must have a registered agent in its state of formation.
Is Delaware better for investors?
Yes. Delaware is the preferred state for companies seeking venture investment.
Can I change state later?
It is possible but involves costs and paperwork, so choose carefully at the start.
Final thoughts on Wyoming vs Delaware
In the Wyoming vs Delaware debate, Wyoming wins on cost and Delaware on investor reputation, while New Mexico offers the lowest ongoing costs. For a freelancer, the state is a small decision compared with tax and compliance in Spain. Check current fees on the state websites, confirm that your bank and payment providers accept the state and then form the LLC with the right registered agent.
Sources and further reading
- Wyoming Secretary of State
- Delaware Division of Corporations
- New Mexico Secretary of State
- IRS: Employer Identification Number
Related guides
- LLC for Freelancers in Spain: Pros, Cons and Costs
- Registered Agent and EIN: What They Are and How to Get Them
- LLC Formation Services: How to Choose a Provider from Spain
- LLC Bank Account Without Living in the US: Options for Freelancers
Disclaimer: This article is for general information only and is not tax, legal or financial advice. Rules, fees and thresholds change often and differ by country; always confirm current details with the tax authority and a qualified adviser. Some links may be affiliate links, which means we may earn a commission at no extra cost to you.