Wyoming has always had a pro-business policy. They were the pioneers of the LLC in 1977, when they combined a partnership and a corporation to create a hybrid legal entity called a Limited Liability company – whereby the owners of the LLC would be limited in risk of losing (like a corporation) but benefitting from the pass-through federal taxation and flexibility of a partnership.
Wyoming LLC are flexible structures, their owners can freely determine in the operating agreement how the LLC will run. There are minimal company structure requirements for its management, nor are there provisions for company meetings, directors, secretary, or capital.
It may be formed by only 1 person and may be managed by its members or employees without an ownership stake.
Wyoming LLCs are private entities. Details of its members, managers or officers are not disclosed in a public registry.
In addition, Wyoming is the only state with specific laws protecting the interests of the members of Single-Member LLCs. Wyoming has spent the time to consider the rights and protections of their Limited Liability Company, and it is reflected by having the strongest legislative law in the nation.
The only state in the US which provides single member LLCs ownership charging order protection is Wyoming. A charging order is an order by the court directed to the LLC ordering it to send all distributions that would have gone to the owner/debtor to the judgment holder instead. This limitation can make it more difficult for a creditor to collect on their judgment because the creditor will not be able to force the debtor to sell his ownership interest in the company.
The incorporation procedure is simple, straightforward, and it can be done in as little as 1-2 days. Wyoming LLCs also benefits from the lowest incorporation and maintenance costs of the US.
Wyoming LLCs may elect to be treated as a C-Corp (subject to corporate tax) or be fiscal transparent entities. Profits of an LLC that elects to be a fiscally transparent entity, is considered to be transferred to its members and taxed at the personal level. Members pay personal income taxes on LLC profits proportionally to their share of participation in the LLC, whether distributed or not.
This means that a Wyoming LLC is not seen as a separate entity for taxation purposes, and therefore if its members are non-US tax residents they will only be required to pay taxes in the US on income sourced from the US.
It is important to note that certain countries do not recognize the pass-through status of an LLC, if the LLC is deemed to be tax resident in one of such countries, it may be subject to corporate income tax.
Wyoming LLCs are commonly used for asset protection, e-commerce, Amazon FBA, professional services, banking in the US and get access to merchant accounts, for startups and as a holding company.
