What is the best state to form an LLC?

For most founders, the best state to form an LLC is your home state — the state where you physically live and operate your business. Forming in a different state like Wyoming or Delaware only makes sense if you have no physical US presence, need specific privacy protections, or are raising venture capital.

The common advice to form in Wyoming or Delaware ignores a critical fact: if you operate in a different state, you must register as a foreign entity there anyway, paying double fees. Wyoming is ideal for non-residents seeking privacy and low costs ($100 filing + $60/year). Delaware is preferred by VC-backed startups due to its specialized business court. Nevada's supposed tax advantages are largely marketing — it still requires a $350/year business license plus $150 annual list fee, making it more expensive than Wyoming.