Anonymous LLC States: Where & How Can You File?

Filing an anonymous LLC can be a smart choice for business owners who want to protect their personal information. LLCs offer asset protection in the case of legal dispute. In this article, we’ll provide a step-by-step guide on how to file an anonymous LLC and safeguard your privacy. Business types that may benefit from LLC anonymity include local real estate, rental property owners, and even franchise operators. 

What is an Anonymous LLC?

A Limited Liability Company is a type of business structure that offers limited personal liability protection and tax benefits such as pass through taxation for the owners transacting business. Pass through tax means the owners do not pay a corporate income tax requirement because income is “passed through” the entity and taxed as personal income,

In New Mexico and other states anonymous LLC is a limited liability company that is formed to keep the identities of its owners and other formation information private. The owner’s identities for a private LLC are not disclosed on the public record but the LLC must still pay annual fees, file annual reports, and have registered agents on file with the state government entity. Not all states in the US recognize anonymous LLCs in New Mexico and other states. Some states allow for anonymous ownership through the use of a registered agent or a nominee, while others require the disclosure of the LLC owners’ identities. It’s important to check the laws in your state before filing for an anonymous LLC. LLC anonymity adds another layer of privacy for the LLC members and owners because the authorized representative will receive all legal documents, file formation documents and will be listed in the public record.

How to Set up an Anonymous LLC?

An anonymous LLC is a type of corporate veil that provides additional privacy protections for business matters, small businesses, and any family member taking part in business with the real owners. Here are three steps to set up anonymous LLCs in your state:

Choose the state: 

Select a that allows for anonymous LLC ownership and research its specific requirements. Both Wyoming and New Mexico, along with 19 other states allow for anonymity. Once you know the requirements, you can choose the business name.

Choose a Registered Agent:  

Designate a representative or nominee to act as the LLC’s public face, to receive legal documents and other communications on behalf of the LLC. This can be an individual, such as the actual owner, or third party registered agent. The third party will be a separate business, usually a professional service, that provides registered agent services for a fee. One of the most important service is that of filing annual paperwork, and the nominee service will keep track of the filing deadlines the annual report requires, laws, and other information small businesses need to know to form an LLC. 

File The Articles of Organization: 

To form an LLC depends on the accurate filing of organization articles with the state’s Secretary of State and pay the required annual fees. In some states, you may also need to file a Statement of Information or similar document. To prevent fraudulent LLCs from filing anonymous LLC’s, states may require a registered agent or nominee to be listed on the single member LLC formation documents, and may also require identity verification for the owners. Additionally, states may conduct background checks or require proof of business activities, such as for real estate investors, to ensure that only one member LLC is legitimate before granting anonymity. It’s important for state officials to carefully review formation documents and verify the legitimacy of the business before granting anonymity. Keeping fraudulent LLCs from filing anonymous LLCs is important because they can make it more difficult to identify the owners of the business, which can create opportunities for fraudulent activities such as money laundering, tax evasion, or other illegal activities. By requiring identity verification and conducting background checks before a business form LLCs, states can help actual residents ensure that these are legitimate businesses that comply with all legal and regulatory requirements. It may also cut down on frivolous lawsuits.

Anonymous LLC States

Several states in the US permit anonymous LLCs through the use of a representative or a nominee. Some states will have more favorable laws than others regarding current employer, liability, and business practices. These are the states that allow for anonymity: 

Delaware, Alaska, Arizona, Indiana, Kansas, Maine, Massachusetts, Minnesota, Missouri, Wyoming, Nevada, New Mexico, Montana, Oregon, Oklahoma, Florida, Nebraska, North Dakota, Texas, Utah, Florida.

However, it’s important to note that the laws regarding how to form an LLC can vary in each state, and some states require additional documentation or fees. It’s best to consult with a legal professional or a representative to ensure compliance with the state. The anonymous LLC’s state will determine all of the paperwork required for

Pros & Cons of Starting an Anonymous LLC

It’s important that more corporations consider other factors before deciding whether an anonymous LLC is the right choice for your business as only a few states, including New Mexico, Missouri, and Montana recognize them.

Pros

There are several benefits in forming an anonymous LLC in New Mexico and other states:

• Privacy protection: By keeping the owners’ identities private, anonymous LLCs can offer greater privacy protection, which can be beneficial for owners who wish to keep their personal information confidential.
• Reduced liability: As with other types of LLCs, anonymous LLCs can limit the owners’ personal liability for the company’s debts and obligations. This type of asset protection can provide peace of mind and protect the owners’ personal finances.
• Increased credibility: In some cases, having an anonymous LLC can increase the credibility of the business by giving the impression that it is larger or more established than it actually is.
• Tax benefits: An anonymous LLC is taxed in the same way as a traditional LLC for federal income tax purposes. The LLC does not file corporate income tax and is not taxed as a separate LLC business entity, but rather the income, deductions, and credits flow through to the owners’ personal tax returns. This means that the LLC itself does not pay income tax, but the owners are responsible for reporting the LLC’s income on their personal tax returns and paying corporate income taxes on that income.

Cons

There are also limitations to forming an anonymous LLC in New Mexico and other states: 

• Limited access to financing: Since anonymous LLCs can be viewed as riskier by lenders, it can be more difficult to secure financing or credit for the business.
• Higher setup costs: Setting up an anonymous LLC can be more expensive than setting up a traditional LLC due to the additional requirements and paperwork involved.
• Legal restrictions: Some states have specific legal restrictions or requirements for anonymous LLCs, and it may be difficult to operate in certain industries or conduct business.
• Tax restrictions: State income tax laws regarding anonymous LLCs can vary, and some states may require additional documentation or disclosure of ownership information for tax purposes. It’s important to consult with a legal professional or a tax advisor to ensure compliance with state tax laws.

Starting an Anonymous LLC in Other States

It’s possible to start an anonymous LLC in another state. There are very tax friendly states, and some that are not as friendly; all states require specific information. Here are a few things to keep in mind:

• Business registration: You will need to register your business in the state where you want to form your anonymous LLC. This typically involves filing the organization articles with the Secretary of State and paying the required fees.
• Registered agent or nominee: You will need to appoint a registered agent or nominee who is located in the state where you want to form your anonymous LLC. This person will receive legal documents and other communications on behalf of the LLC, will be able to file the annual report and annual report fee with your state, and will keep all LLC members updated regarding ownership information, public records, etc.
• Compliance with laws: You will need to comply with the laws and regulations regarding confidential LLC in the state where you form your business. These laws can vary widely from state to state, so it’s important to research the specific requirements in the state where you want to form your LLC.
• Taxation: Like any regular LLC, the anonymous LLC will not pay corporate income tax. Taxes are passed through the company to the shareholder, owner, or LLC member.
• Reporting and Accounting: It is important to keep the bank account of the LLC separate from your personal bank account; it is also important to ensure the annual report is filed on time to remain in compliance. This is true for all LLC members as LLCs doe not require corporate income tax so all personal returns must recognize the business income for Internal Revenue Service purposes. 

It’s important to note that forming an anonymous LLC in another state can have additional costs and administrative burdens for the business owner. These include maintaining a registered agent and complying with that state’s ongoing reporting requirements.

The Top 2 LLC Services

ZenBusiness

Through ZenBusiness you can search for available trade names, DBA names, create articles of incorporation, find out the needed documentation for your state and federal filings and registrations, obtain an EIN, build the company’ web presence through domain names, email, and domain privacy protection. 

ZenBusiness offers three tiers for members ranging from $49/year to $299/year. For each tier there are additional charges which will not be included; these include an EIN filing charge (one time, $70), a worry free guarantee service ($129 per year), and a 25% discount on agent services, any state filing fees. 

Northwest

Northwest is primarily a Registered Agent Service but their suite of tools does offer additional business services at a reasonable price. The initial cost is $39 to file the LLC paperwork; all other charges are due as per your state’s regulations. There is a separate option, called Pay In Full. With this option, which costs $225, Northwest will file the LLC, and provide agent services for one year, however, all other charges from state fees, etc., will still apply. 

Northwest will scan up to five regular documents each year for free; after the initial five there is a charge for additional services. This is also different from other providers as many will only scan and send legal documents. 

Read More: Best LLC Services 2024

Final Thoughts

Not all states permit anonymous LLCs; at this time only 21 have the provision to create an anonymous company. These include New Mexico, Delaware, Maine, Massachusetts, and Florida among others. In conclusion, forming an anonymous LLC can offer privacy protection, asset protection, and reduced liability for the owners. LLCs are required to file an annual report and other documentation; check with each state to determine the cheapest anonymous LLC option. However, it’s important to carefully consider the pros and cons, as well as the legal requirements, before deciding to form an anonymous LLC. There are only a few anonymous LLC states; some states will not allow for the formation of private LLCs and some will not allow for this type of formation but will recognize an anonymous LLC filed from outside of the state. Additionally, state laws regarding private LLCs can vary, so it’s important to consult with a legal professional or a registered agent to ensure compliance. Ultimately, an anonymous LLC can be a good option for those who value privacy and reduced personal liability, but it may not be the best fit for every business.

Frequently Asked Questions (FAQs)