Form an LLC Anonymously (How to Keep Your Personal Details Private)
Are you a new business owner? Want to protect your business from future lawsuits? You should form an LLC. Moreover, you can form an LLC and keep your identity protected as well. This guide will help you learn how to anonymously form an LLC.
It is very easy to set up an anonymous LLC. However, there are some rules and regulations that you need to keep an eye on while running this type of company.
Are you in a hurry and don’t have time to go through the comprehensive review?
Northwest Registered Agent offers the best privacy features for forming your LLC. Here’s why that is important:
- Business dealings are kept confidential
- Your name and address stays private
- You remain protected from unsolicited visitors, mailings, etc.
Northwest is more expensive than other LLC formation services, but if you want to protect your privacy, they are the best in the business!
Why should you form an anonymous LLC? What are its benefits and drawbacks? Before we dive into this discussion, let’s see what an LLC is and we will go on from there.
Owning an anonymous LLC doesn’t mean that you are going to work from the shadows and do something illegal. It is simply about keeping your personal information off the public records to maintain your privacy. Your ownership will be known to your bank and the IRS as well.
For instance, when you are going to open your business bank account, you have to provide your home address. You can’t give a fake address, the address to a private mailbox, or someone else’s address. However, this information never becomes part of public records so you don’t have to worry about your privacy getting breached!
What is an LLC?
To protect your company from potential lawsuits, you can form an LLC. An LLC is a business structure that provides liability protection and keeps your business and personal assets separate. An LLC combines the elements of general partnerships, corporations, and sole proprietorships to give you the best of all of them.
The owners or members of the LLC are not responsible and personally accountable for the business’s financial status. LLCs are low-cost, easy to maintain, and flexible when it comes to tax options. The regulations for LLC formation vary from state to state.
However, a few rules are common and universal such as filing Articles of Organization, designate registered agents, etc.
What is an anonymous LLC?
Now that we understand what an LLC is, comes the question that matters the most: What is an anonymous LLC? Well, an anonymous LLC is an LLC with the potential to keep your identity protected. Instead of being a member-managed LLC, it is more of a “manager-managed” LLC.
What is the difference between the two? Well, the main difference is that a manager-managed LLC is not legally obligated to disclose the name of its owners and make them a part of the public records. Contrary to this, the names of a member-managed LLC need to be public.
There is no legal difference between the two, though and there is no difference in the way they are formed as well, which we will discuss later. anonymous LLCs are also referred to as confidential LLCs or private LLCs.
Why should you form an anonymous LLC
There are plenty of good reasons for forming an anonymous LLC. Let’s quickly look at a few of them.
- Identity Theft Safety. If you have faced issues of identity theft in the past, anonymous LLC is your best option. With an anonymous LLC, you don’t have to worry about stalkers, fraudsters, etc. since your personal information will not be there for anybody to misuse.
- Negative Publicity Protection. We all want our business dealings to remain separate from our personal dealings. In case your company gets sued, or your business faces any legal action in the future you will not have to deal with the fallout in your personal life.
- Family Life Privacy. We all know how harsh media can get these days, without any respect for personal boundaries. You can keep yourself and as well as your family away from the public eye if your business is registered as an anonymous LLC.
Myths regarding anonymous LLCs
Here are a few misconceptions regarding anonymous LLCs that we would like to debunk.
- Tax Avoidance. It is a very common misconception that if you form an anonymous LLC, you will not have to pay any taxes. This is false and you will pay taxes just like any other LLC, anonymous or not.
- No legal trace. Many people think that if you form an anonymous LLC, there will be no trace of all your business dealings which is not true as both the IRS and the government. will be aware of any business transactions that you conduct.
- Illegal LLCs. Another misconception exists about anonymous LLCs that they are illegal LLCs and are involved in shady business. However, this is a false allegation and anonymous LLCs are completely legit. The only thing that anonymous LLC owners are looking for is privacy since they don’t want their personal lives to be scrutinized by anyone.
States that help with anonymous LLC formation
No state prohibits the formation of an anonymous LLC. However, some are simply better at this than others and it is very likely if you call your state office, they will not be of much help. However, there are a couple of states that are very famous for providing the anonymous LLC option such as Delaware, New Mexico, and Wyoming.
Four states in the US allow you to form completely anonymous LLCs– Delaware, New Mexico, Nevada, and Wyoming. In other states, you will have to provide a little information and some of it will become part of public records. Instead of hiring a business attorney, you should get help from professional LLC incorporation services such as IncFile or ZenBusiness.
For US residents, we recommend that your state of LLC formation should be the state you are doing business in. If you form your LLC in a separate state, that will be difficult and expensive considering foreign qualification fees, licenses, permits, etc.
For non-US residents, states such as Delaware, Nevada, New Mexico, etc. are great options because they give you the automatic option of forming an anonymous LLC.
Advantages to anonymous LLC formation in Delaware
In Delaware, the ownership information is not published but is certainly disclosed to the state. Any changes in the law in the future can cause this information to become public. Moreover, you have to pay annual franchise fees as well as annual report fees.
The state of Delaware is aware of the importance of privacy and offers various privacy protections that ensure you enjoy doing business in the state without the added tension and worry about unwanted solicitors.
In Delaware, there are various advantages when it comes to LLC formation. Let’s see what they are:
- Special Justice System. The justice system of Delaware consists of judges who are well-versed and experts in business law. This is a huge advantage in case you have any legal issues in the future.
- LLC structure options. There are several options for structuring your LLC in Delaware. You can choose one that fits your needs perfectly. An expert from ZenBusiness or IncFile will walk you through the details so take their help with LLC formation!
- No Residency. You don’t have to be a resident of Delaware to open an LLC there which is a great option for foreigners wanting to do business in the US.
- Corporate Income Tax. You don’t have to pay corporate income tax. Only a small franchise tax will be levied on your LLC.
Advantages to anonymous LLC formation in Mexico
In New Mexico, you don’t have to submit the ownership information or the management info to the state. However, you have to pay corporate income tax. However, sole-member LLCs and pass-through entities don’t have to worry about this anyways.
- No LLC ownership information. You only have to give the name of your registered agent and the organizer/manager of your business and you will be good to go. Even if the law changes in the future and they are obligated to publish the LLC ownership information, they won’t have any info to publish! The state doesn’t have any annual reporting requirements as well.
- No Residency. Similar to Delaware, you don’t have to be a resident of New Mexico to form an anonymous LLC there.
- Low State Filing Fee. If you are low on budget, New Mexico will be the perfect state for you since the state filing fee is only $50. Opt for IncFile’s free LLC incorporation package and your LLC will be up and running for only $50!
How to form an anonymous LLC
Now is the time for the most important question: How to form an anonymous LLC. The process for forming a regular LLC and an anonymous LLC is the same. The only difference is that when you file the articles of organization, the personal details that you provide are kept off the public records.
The basic steps for forming an anonymous LLC are:
- Selecting the State of Formation
- Selecting the LLC’s name
- Assigning a Registered Agent
- Filing the Articles of Organization
- Getting an EIN
- Forming Business Operating Agreement
- Completing the Licensing Requirements
Selecting the state of formation
As we mentioned above, a few states are very helpful when it comes to forming an anonymous LLC. Get in touch with an expert LLC incorporation service such as Northwest registered agent and they will give you all the information that you need.
Selecting the LLC’s name
An LLC’s name is very important. It is the first thing that your customers see or hear and it leaves an ever-lasting impact on them. A catchy, unique LLC name is something that will help you catch the attention of more people.
Once you have brainstormed and selected a name, check the database of the state of formation to see if that name is available. If it is available, and you don’t want to file your LLC as yet, simply pay name reservation fees and keep other people from getting their hands on it!
Every state has a few guidelines regarding which terms you can use in your LLC’s name which are forbidden. Go through those guidelines as well to prevent any issues with your paperwork later.
Assigning a registered agent
To ensure that your state has a reliable and credible way of contacting you, you have to hire a registered agent. You can become your own registered agent, choose a professional LLC incorporation company as your registered agent, or ask your friend or family member to become your registered agent.
If you become your own registered agent, your name and address will become part of the public records which will nullify the whole purpose of forming an anonymous LLC in the first place, Moreover, you will be vigilant about meeting all the deadlines as well as staying available during working hours.
Your friend and family members will have the same concerns regarding privacy. Moreover, they are humans as well and can very likely forget to send over important documents to you. Therefore, we recommend that you choose a professional registered agent.
With a service provider like Northwest Registered Agent, you will not have zero privacy concerns but you will get your legal documents right on time. Moreover, you will also get your hands on their highly-valued features such as one-on-one customer support, local scanning of documents, annual compliance, etc.
Filing the Articles of Organization
Once you choose the name and the registered agent for your anonymous LLC, you need to draft the articles of organization. These papers will contain the information necessary to form your LLC.
This information will be part of the state records but will not be on display to the public if you opt for an anonymous LLC. You can fill out the details on your state’s website or mail in a physical form.
We recommend that you don’t draft the papers yourself as you are not a lawyer or someone proficient in legal jargon. The whole filing process takes a few weeks, and if you have made a mistake in the documents, you will have wasted a lot of your precious time.
It is always a safe bet to go with a professional incorporation company such as ZenBusiness.
Getting an EIN
An Employer ID number is synonymous with a social security number. Individuals pay their taxes, etc. with the social security number. Similarly, for businesses, there are EINs that they use to hire employees, pay their taxes, open LLC bank accounts, etc.
You can get an EIN by filling out the required details on the IRS website. However, again, we ask you to take professional help since filing for an EIN is a technical job, especially if you are a layman and prone to errors.
Forming business operating agreement
A business operating agreement is a document that outlines the ownership and hierarchy of your company, the rules for day-to-day operations, along with regulations about profits division, voting powers, company dissolution, etc.
You don’t have to submit this document to your state of formation. However, it is very necessary that you draft one to ensure the smooth running and working of your company. If you have selected an LLC incorporation company to help you form your anonymous LLC, you can ask them to draft a customized business operating agreement for you.
Professional service providers usually offer business operating agreements as part of their LLC incorporation packages or offer this as a separate service as well. You can select the option that is easier for you and your business.
Completing the licensing requirements
Depending on the type of business you are going to run, you will need permits or licenses. Are you going to open a health clinic? Are you going to open a catering service? No matter what kind of business you do, you will need a license or permit to run it successfully.
Every state has different licensure requirements and so does every county, city, etc. You should check your state’s website as well as visit your local town hall to know what kind of permits you need.
It is very likely that you will not know how to file for a particular license. In such a case, instead of making errors and landing yourself in potential lawsuits, you should hire a professional LLC incorporation service.
Not only will they ensure that you fulfill all the requirements but they will also make sure that you do so in a timely fashion. The sooner you get a license, the quicker it will be for you to get your business up and running!
These are the basic steps that you need to follow to form your LLC. However, there are various other requirements such as a business bank account, business web domain, etc. that will help you run your business. Choose the best LLC incorporation service and you will not have to worry about anything at all!
Form an LLC anonymously – Final word
Who doesn’t value their privacy, right? If you want to keep your private life away from the scrutiny of the public eye, you should form an anonymous LLC. A few states allow more flexibility while forming an anonymous LLC as we have discussed above.
To know more and make sure that you are choosing the best possible option, you should get the help of expert LLC incorporation services such as ZenBusiness or Northwest Registered Agent instead of making errors on your own.
- Northwest Registered Agent is the best company when it comes to privacy. They are slightly expensive, but their one-on-one customer service, local scanning of your documents, and stellar customer reviews make them worth every single penny!
- ZenBusiness provides the best overall value. Not only do they have affordable, feature-full packages for their users, but they have a strong industry reputation as well that is backed up by glowing recommendations from their users!
Which states in the US allow flexible anonymous LLC formation?
There are currently four states in the US – Delaware, Wyoming, New Mexico, and Nevada – that allow you to form a completely anonymous LLC. To learn the rules about anonymous LLC formation in your state, you should contact a professional LLC formation service such as Northwest Registered Agent.
Will the information that I provide to the bank while creating an LLC bank account remain private?
Yes, any information that you provide to the bank when you are opening a business bank account for your LLC will be kept away from public records. However, if there is any legal action against you, the govt. can subpoena the bank and ask for your records.
Can I keep my personal information hidden while creating an LLC?
Usually, the ownership information of an LLC becomes part of the public records. However, if you choose to form an anonymous LLC, your personal information will be off the public records.