How to Start an LLC in Wyoming? (Step-by-Step Guide)

Published by Jon Morgan | Co-Founder & Chief Editor

Last updated: September 17, 2024

FACT CHECKED by Lou Viveros, Growth & Transition Advisor

Methodology
We meticulously research and verify the information presented in our articles. By consulting reliable sources and ensuring factual accuracy, we are committed to providing readers with well-informed, trustworthy content.

Forming an LLC in Wyoming can be a great way to protect your assets. There are a few steps that need to be followed in order for your business entity to be recognized as a limited liability company by the Wyoming Secretary of State.

After a decade of experience as a business consultant specializing in LLC formation, I’ll share with you a complete guide on how to start a Wyoming limited liability company.

I’ve consulted our panel of LLC experts and attorneys in the state to provide all pertinent information with regard to state laws and legal paperwork.

Also, if you're inclined to have a specialist establish your LLC, we advise considering these Wyoming LLC formation services.

Quick Summary

How to Form an LLC in Wyoming

To form an LLC in Wyoming, comply with statutory requirements and file the legal documents with the Wyoming Secretary of State.

1. Choose the Type of Your Wyoming LLC (Mandatory)

In Wyoming, entrepreneurs can choose between different types of LLCs, each with its own set of advantages and disadvantages.

Single-Member LLC: Ideal for individual owners, offering simplicity and ease of management. However, it may face limitations in raising capital and can be perceived as less credible by some financial institutions.

Multi-Member LLC: Suitable for businesses with multiple owners, providing flexibility in profit sharing and management. The complexity of managing multiple members and potential internal conflicts are downsides to consider.

Series LLC: Allows for the creation of separate series within a single LLC, each with distinct assets and liabilities. This structure is complex but offers excellent protection for different business ventures under one umbrella.

Professional LLC (PLLC): Designed for licensed professionals. It maintains the benefits of a regular LLC while meeting specific industry regulations. The restriction to only certain professions is a limitation.

Each type offers unique benefits, from simplicity and flexibility to asset protection and industry-specific features. Choosing the right type depends on the specific needs and goals of the business.

2. Choose a Name for Your Wyoming LLC (Mandatory)

Choosing a unique LLC name is something I emphasize with my clients. Recently, I assisted a client in searching for a name on the Secretary of State’s website.

We discovered their preferred name was already taken, so we brainstormed alternatives, ensuring compliance with Wyoming’s naming guidelines. This proactive approach helped us avoid legal complications and secure a suitable name for their business.

Once you find an available name, you have the option to reserve it with the same agency by filing a name reservation form and paying a $60 fee.

The state of Wyoming has the following guidelines when naming a limited liability company:

• The name of the company should be distinguishable from other LLCs or business entities
• The name of the LLC should not end with “corporation,” "incorporated,” or their abbreviated counterparts.
• The name should be followed by the phrase “Limited Liability Company” or its abbreviated form, “L.L.C. or LLC.”
• Words associated with government agencies like “Federal,” "Treasury,” or “Bureau” should not be included in the LLC’s name.
• The words “bank,” "insurance,” or “trust” should be avoided to prevent ambiguity [1].

3. Select a Registered Agent (Mandatory)

A Wyoming registered agent is a person or company you appoint to provide official service of process and receive documentation on behalf of your LLC. For this reason, the registered agent should have a physical address within the state.

Selecting a registered agent is a step I never overlook with clients. For example, I once helped a client choose a reliable agent service that offered not just legal document handling but also compliance and financial planning services. This added value was instrumental in their business’s smooth operation and legal compliance.

With a workforce of 128,883 small business employees comprising 63.8% of the state's total employment, as reported by the U.S. Small Business Administration, securing a dependable registered agent for your LLC is essential for upholding the operational integrity vital to sustaining a major segment of Wyoming's workforce [2].

Typically, the individual or company should be reachable during regular business hours to conduct specific duties on behalf of the limited liability company.

The main function of a registered agent is to accept and acknowledge legal documents from government agencies. However, opting for professional services offers several benefits. The cost of registered agent services starts at $40 per year, but this can vary depending on the company you choose.

Northwest Registered Agent is highly recommended for their reliability and range of services, providing additional value beyond the basic requirements.

In some cases, your LLC's registered agent may be able to offer other services like business compliance or even financial planning—if they do, then their price will reflect that added benefit.

4. File Wyoming Articles of Organization (Mandatory)

Filing the Articles of Organization is a pivotal step. I recall assisting a client in drafting this document, ensuring all details like business purpose and member information were meticulously included.

We then filed it online, opting for the convenience and quicker processing time. This meticulous approach ensured their LLC was established without any hitches.

You can draft your own document or use an online template for your Articles of Organization.

The state fee for filing is currently $100 plus any county fees or a $2 additional fee if you file your Articles of Organization online. Visit our page for more information about the cost to start a Wyoming LLC.

The Wyoming LLC Articles of Organization contain basic company information such as the following:

• Name of your LLC
• Business address
• Registered agent
• Names and addresses of members
• Name of the organizer
• Purpose and nature of the business
• Effective date

Steps to Take After Forming an LLC in Wyoming

5. Create a Wyoming LLC Operating Agreement (Optional, but Recommended)

An operating agreement is an internal document of the LLC that outlines the general provisions of the company. In essence, the operating agreement is a binding contract between all the members of the LLC.

An operating agreement is not required under Wyoming law but is highly advisable to draft to serve as an official business guideline for the company.

The LLC operating agreement, to be effective, should include the following provisions:

• The ownership interest of each member
• The scope of the rights and duties of managers and members
• The management structure of the company
• The allocation of profits and losses among members
• The rules on conducting meetings and resolving votes
• The protocol for transfer of ownership, admitting members, retirement or death [3]

6. Apply for an Employer Identification Number (EIN) (Optional, but Recommended)

An Employer Identification Number (EIN) is issued by the Internal Revenue Service (IRS) to newly-established businesses in the state for the purpose of tax administration.

An EIN is required if your limited company plans to hire employees or open an LLC bank account.

You can obtain an EIN online, by fax, or by phone, and you will receive confirmation once your number has been issued.

When applying, provide your business name, its primary address, and the mailing address of the registered agent.

7. Open an LLC Bank Account (Optional, but Recommended)

Opening a bank account for your Wyoming LLC, although optional, is strongly recommended for its numerous benefits.

It ensures financial separation between personal and business assets, which is critical for legal and tax reasons. This separation enhances professionalism, as transactions are conducted under the business name, boosting credibility with clients and vendors.

To open an LLC bank account, gather necessary documents like your LLC's Articles of Organization, EIN, and Operating Agreement.

Choose a bank based on services, fees, and convenience. Decide on the type of account—checking, savings, or merchant—based on your business needs.

The process typically involves an application, an initial deposit, and setting up online banking for easy management. Regular monitoring of the account aids in accurate financial tracking and fraud prevention.

8. File your Wyoming LLC Annual Report (Mandatory)

Filing an annual report is a mandatory requirement for LLCs registered in Wyoming. Each year, your Wyoming LLC must submit this report to the Secretary of State.

The annual report typically includes essential updates about your business, such as the names and addresses of members and managers and any changes in the principal office address. It's crucial to adhere to the filing deadlines set by the state to maintain your LLC's good standing.

Failure to file the annual report can lead to penalties or even the dissolution of your LLC.

To ensure compliance, check the Wyoming Secretary of State’s website for specific details on filing procedures, deadlines, and any applicable fees. This annual exercise helps keep state records updated and your business in compliance with Wyoming regulations.

9. Obtain Business Licenses and Permits

In Wyoming, LLCs must obtain specific licenses and permits based on their activities. This includes state-specific licenses for professions like healthcare and construction. Additionally, a sales tax permit is necessary for businesses that sell goods or taxable services.

Local business licenses also vary. In places like Cheyenne, certain business activities require a local license. For regulated professions, obtaining professional licenses through state boards is mandatory.

It's crucial for LLCs to comply with these requirements to avoid legal issues. This involves regular checks with the Wyoming Secretary of State, local government offices, and relevant state departments to ensure continuous and lawful business operations.

10. Choosing your Tax Structure

Selecting the right tax structure for your Wyoming LLC is crucial, as it influences liability, tax obligations, and operational flexibility. The primary structures are disregarded entities, partnerships, C corporations, and S corporations.

Disregarded Entity/Partnership: Suitable for single-member LLCs or multi-member LLCs, respectively. They offer pass-through taxation, meaning profits and losses are reported on personal tax returns. However, members pay self-employment taxes on the entire profit.

C Corporation: It separates personal and business taxes but faces double taxation—corporate profits are taxed, and dividends are taxed again on personal returns. Ideal for businesses planning to reinvest profits rather than distribute them.

S Corporation: Avoids double taxation of C Corps while offering liability protection. There are restrictions on the number and type of shareholders. It's beneficial for saving on self-employment taxes, as members can be paid as employees.

I lean towards an S Corporation for its tax benefits and flexibility. However, it's not one-size-fits-all; your choice should align with your business goals and financial situation.

You can change your tax structure, but timing is key. For instance, to be taxed as an S Corporation in a specific year, you must file IRS Form 2553 within two months and 15 days of the beginning of the tax year when the election is to take effect. Regular reviews of your tax structure are advised to adapt to business growth and changes.

Benefits and Drawback of an LLC in Wyoming

Benefits:

1. Tax Advantages: Wyoming offers a favorable tax environment for LLCs, including no state income tax and low sales tax rates. This can be particularly beneficial for businesses looking to minimize their tax burden. With small and medium businesses (SMBs) constituting 98.9% of all businesses in Wyoming, approximately 68,641 small firms are spread across the state territory, highlighting the thriving entrepreneurial environment that benefits from these tax advantages [2].
2. Asset Protection: Wyoming LLCs enjoy strong asset protection laws, providing members with limited liability and protecting personal assets from business debts and lawsuits.
3. Business-Friendly Climate: The state is known for its business-friendly policies, streamlined processes, and minimal regulatory hurdles, making it easier to start and operate an LLC.

"Wyoming imposes some of the strictest regulations in the country on lenders attempting to collect from LLC members on a defaulted loan. They are prohibited from holding you accountable for the defaulted loans of other LLC members, as well as from seizing or foreclosing on assets owned by a Wyoming LLC."

-Jon Morgan, Co-Editor & Co-Founder of Venture Smarter

Drawbacks:

1. Limited Market Size: Wyoming's small population may present challenges for businesses targeting a local market, potentially limiting growth opportunities.
2. Economic Diversity: The state's economy is heavily reliant on a few industries like mining and agriculture, which might not favor businesses outside these sectors.
3. Geographical Limitations: For businesses that require a significant physical presence or access to larger markets, Wyoming's remote location and sparse population may be a disadvantage.

Related Articles:

• How to Cancel an LLC in Wyoming
• Looking up an LLC in Wyoming

DIY vs. professional LLC formation

DIY Formation:

Pros:

1. Cost-Effective: DIY formation is generally cheaper, as it avoids professional service fees.
2. Control and Understanding: Handling the process yourself can lead to a better understanding of your LLC's legal framework.

Cons:

1. Time-Consuming: Requires significant personal time and effort.
2. Risk of Errors: Without legal expertise, there's a higher risk of making mistakes in the formation process

Professional Formation:

Pros:

1. Expertise: Professionals offer legal knowledge and experience, reducing the likelihood of errors.
2. Time-Saving: Outsourcing the process saves time and allows you to focus on other aspects of your business.
3. Compliance Assistance: Professionals ensure all state-specific requirements are met.

Cons:

1. Cost: Professional services are more expensive than DIY.
2. Less Personal Control: You may have less involvement in the intricacies of the formation process.

The choice between DIY and professional LLC formation depends on your budget, time availability, and comfort with legal procedures.

DIY is cost-effective but time-consuming and riskier, while professional formation offers expertise and peace of mind but at a higher cost. Consider your specific needs and circumstances to make an informed decision.

FAQs

References

1. https://sos.wyo.gov/Business/Docs/HowToChooseACompanyName.pdf
2. https://advocacy.sba.gov/wp-content/uploads/2020/06/2020-Small-Business-Economic-Profile-WY.pdf
3. https://www.sba.gov/blog/basic-information-about-operating-agreements