Wyoming, Delaware, and New Mexico are the three states every "best state for an LLC" article mentions — usually without explaining who each one is actually for. This is the head-to-head comparison that names winners by use case, with real numbers.
At a glance
| Wyoming | Delaware | New Mexico | |
|---|---|---|---|
| Filing fee | $100 | $110 | $50 |
| Annual cost | $60 | $300 | $0 |
| 10-year state cost | $640 | $3,110 | $50 |
| Processing speed | 1–3 days | 1–3 days | 1–2 weeks |
| State income tax | None | None | None |
| Member privacy | Excellent | Excellent | Excellent |
| Business courts | Good | Best (Court of Chancery) | Basic |
| Annual report | Yes ($60) | Yes ($300 tax) | None required |
Round 1: Cost — Winner: New Mexico
This is not close. New Mexico charges $50 to file and then nothing, ever — no annual report, no annual fee. Over a decade, that is $50 total vs. $640 for Wyoming and $3,110 for Delaware.
The caveat: New Mexico's processing is the slowest of the three (plan for 1–2 weeks), and its business-law ecosystem is the thinnest. But if your metric is dollars out of pocket, New Mexico wins by a mile.
Round 2: Privacy — Winner: Tie (all excellent)
All three states keep member names off public filings — a major reason founders choose them over states like California or New York, where ownership is public record. Wyoming adds particularly strong asset-protection statutes (charging order protection), giving it a slight edge for holding companies, but for typical small businesses all three are excellent.
Round 3: Speed — Winner: Tie (Wyoming & Delaware)
Wyoming and Delaware both routinely process filings in 1–3 business days, with expedited options available. New Mexico is noticeably slower at 1–2 weeks. If you need your LLC this week, cross New Mexico off — or pay for whatever expedited option is available.
Round 4: Courts & legal infrastructure — Winner: Delaware
Delaware's Court of Chancery is the most sophisticated business court in America, with centuries of predictable case law. This is why venture capital firms overwhelmingly prefer Delaware entities — investors, lawyers, and acquirers all speak the same legal language there.
But be honest with yourself: if you are not raising institutional capital, you will never appear before the Court of Chancery. Paying $300/year for a court you will never use is prestige pricing.
Round 5: Taxes — Winner: Tie
None of the three has a state income tax, and LLCs are pass-through entities anyway (profits taxed on your personal return). No meaningful difference here for most founders.
Who should pick which?
Pick Wyoming if…
You run an online business, value privacy, and want the best blend of low cost, speed, and legal credibility. Wyoming is the default recommendation for most out-of-state filers — it is the "no regrets" choice.
Pick Delaware if…
You plan to raise venture capital, issue stock options, or eventually convert to a C corp for an IPO or acquisition. If a VC will be involved, just form in Delaware from day one — converting later costs more.
Pick New Mexico if…
You want the absolute lowest lifetime cost and do not mind slower processing. Perfect for side projects, holding companies, and bootstrapped businesses watching every dollar.
Pick your home state if…
You have a physical presence, employees, or customers concentrated in one state. Foreign qualification fees (registering your out-of-state LLC where you actually operate) usually erase any savings from filing elsewhere.
The foreign qualification trap
This deserves emphasis: forming in Wyoming while operating in Texas does not exempt you from Texas. You must register your Wyoming LLC as a "foreign LLC" in Texas — paying Texas fees, filing Texas reports, and maintaining a Texas registered agent. Now you are paying for two LLCs' worth of compliance. Unless you are fully location-independent, your home state wins on total cost every time.
Our verdict
- Best overall for out-of-state filers: Wyoming — the balanced champion.
- Best for venture-track startups: Delaware — the investor standard.
- Best for minimum lifetime cost: New Mexico — unbeatable at $50/decade.
- Best for most local businesses: Your home state — simplest compliance.
Whichever you choose, the mechanics are identical — see how to start an LLC for the step-by-step, and compare formation services on our best LLC services page.