Vermont LLC vs Delaware LLC (2026)
Compare Vermont LLC vs Delaware LLC — filing fees, taxes, privacy laws, and annual costs. Find out which state is actually better for your business.
| Factor | Vermont | Delaware |
|---|---|---|
| Filing Fee | $125 | $90 |
| Processing Time | 3 day(s) | 7 day(s) |
| Annual Report Fee | $35 | $300 |
| Annual Report Due | Anniversary month | June 1 |
| State Income Tax | Yes | No |
| Anonymous LLC | No | Yes |
| Publication Requirement | No | No |
| Foreign LLC Cost (if forming out-of-state) | N/A — you're in your home state | ~$220 + registered agent ~$150/yr |
Verdict: Vermont wins for most businesses
For most Vermont-based small businesses, forming locally in Vermont is the smarter choice due to lower ongoing costs and simpler compliance. Delaware only makes sense if you need anonymous ownership, have investors requiring Delaware formation, or plan to go public.
Filing Fees & Formation Costs
Delaware's $90 filing fee appears cheaper than Vermont's $125, but this comparison is misleading for Vermont-based businesses. If you form in Delaware and operate in Vermont, you'll pay Delaware's $90 fee plus Vermont's foreign LLC registration fee of approximately $220, totaling $310 upfront. You'll also need a Delaware registered agent costing around $150 annually, making Delaware significantly more expensive from day one.
Taxes: Vermont vs Delaware
Vermont imposes a state income tax on LLCs, while Delaware has no state income tax for LLCs. However, Delaware charges an annual franchise tax of $300, which is substantially higher than Vermont's $35 annual report fee. For Vermont-based businesses, you'll likely owe Vermont income tax regardless of where you form, eliminating Delaware's tax advantage while adding Delaware's franchise tax burden.
Privacy & Asset Protection
Delaware allows anonymous LLC ownership by not requiring member names on public filings, while Vermont requires disclosure of at least one member's name. Both states offer strong asset protection through charging order protection, limiting creditors to only the economic rights of LLC interests. Delaware's privacy advantage is its main selling point, but this benefit comes at a significant cost premium for most small businesses.
Annual Maintenance Costs
Vermont LLCs pay just $35 annually for their report, due in the anniversary month of formation. Delaware LLCs face a $300 annual franchise tax due June 1st, plus registered agent fees of approximately $150 per year. A Vermont business formed in Delaware would pay roughly $485 annually ($35 Vermont + $300 Delaware + $150 agent) versus $35 for a Vermont LLC, making Delaware 14 times more expensive to maintain.
When Delaware Actually Makes Sense
Delaware formation makes sense for Vermont businesses in limited scenarios: if you need anonymous ownership for privacy reasons, have investors who specifically require Delaware incorporation, or plan to raise venture capital or go public eventually. Delaware's Court of Chancery also provides specialized business law expertise for complex disputes. For typical small businesses, local contractors, or professional services, these advantages rarely justify the extra costs and complexity.