The wrong state choice can cost you hundreds of dollars every year. Our expert guide — based on forming LLCs for 500+ international e-commerce sellers — tells you exactly which states to choose and which to avoid.
These four states consistently deliver the best value for non-US e-commerce entrepreneurs.
Registered agent cost (~$60/yr) included in all states. Based on typical e-commerce seller with no physical US presence.
| State | Year 1 | Year 2-5 (each) | 5-Year Total | Verdict |
|---|---|---|---|---|
| Wyoming | $220 | $120 | $700 | ✅ Best value |
| New Mexico | $110 | $60 | $350 | ✅ Cheapest overall |
| Missouri | $110 | $60 | $350 | ✅ Tied cheapest |
| Arizona | $110 | $60 | $350 | ✅ No annual fees |
| Delaware | $450 | $360 | $1,890 | ⚠️ Expensive |
| California | $930 | $860 | $4,370 | ❌ Avoid |
| New York | $1,960 | $360 | $3,400 | ❌ Avoid |
| Texas | $420 | $60 | $660 | ⚠️ Overpriced start |
* New York Year 1 includes newspaper publication requirement ($1,200 avg). California includes $800/yr franchise tax. Delaware includes $300/yr franchise tax.
These states are famous names but terrible choices for international e-commerce sellers. Here's the truth no one tells you.
Delaware is famous — but mainly for corporations raising venture capital. For international e-commerce sellers, the $300 annual franchise tax is charged every year whether you make money or not. The 'prestigious' legal system only matters if you're in court — most small sellers never need it.
California has a deceptively low $70 filing fee. But it charges every LLC $800 per year in franchise tax — even if you made $0 revenue. If you accidentally do any business in California, you owe this tax too. This alone costs you $4,000 over 5 years just to exist.
New York has a hidden trap almost nobody warns about: the Publication Requirement. You must publish your LLC formation in two local newspapers for 6 consecutive weeks. In Manhattan, this costs $1,200-$1,500+. Plus high annual fees. Total first year cost can exceed $2,000.
Texas has a high $300 filing fee and while annual fees are $0 for most small businesses, the franchise tax kicks in above $2.47M revenue. The real issue is the $300 upfront cost — 3x more expensive than Wyoming to start with no additional benefit for international e-commerce sellers.