Question: I’m concerned about privacy and my name and information staying out of the public record in organizing an LLC. Is Nevada or Wyoming better if you want to remain anonymous? Will this information need to be revealed in a civil suit?
Answer: A business entity is subject to the laws of discovery by courts and government agencies having jurisdiction to subpoena their records. Failure to comply with a court order can result in a civil or criminal contempt charge, so as long as a court has proper jurisdiction over your company, it does not matter whether it is organized in Nevada or Wyoming.
Keeping Your Information Out of the Public Record
However, when it comes to keeping your information from appearing in the public record as a member, there are some subtle, yet important differences in organizing an LLC in Nevada and Wyoming. Typically, when it comes to these types of privacy concerns, Wyoming may be slightly preferable to Nevada for the reasons detailed below.
Wyoming Filing Requirements
In Wyoming, the Articles of Organization do not require the disclosure of the LLC’s members or managers, however, only the registered agent and organizer (person filing the document) are identified in the document. If you use a commercial registered agent service (which you would likely need to do anyways if not residing in Wyoming), and use a third-party, such as an attorney as the organizer, then your information will not appear in the public record. In addition, Wyoming does not require disclosure of this information in their annual informational report.
Nevada Filing Requirements
Organizing an LLC in Nevada has one key difference. Nevada Articles of Organization require disclosure of the the LLC’s governing persons (Wyoming does not). If the LLC is member-managed, the members will be on the Articles of Organization. If the LLC is manager-managed, only the managers will appear, however, if a manager is also a member, those members would appear on the filing. In many cases, particularly with smaller companies, it is common for managers to also be members, so Nevada would often effectively require at least one member be indicated on the Articles of Organization. Note that the Nevada annual list filing also requires disclosure of the LLC’s officers (which may be the same person).
Foreign Entity Registration Disclosure
With the above in mind, please note that if your business is required to make foreign entity filings for other states, those filings may require disclosure of your name in certain circumstances. For example, if your business is legally “transacting business” in the state of Texas, it will be required to file a foreign entity registration, which requires disclosure of the entities managers (if manager-managed) or managing members (if member-managed), which may present the same issues described above in the discussion of filing in Nevada. Despite these filing requirements, there are typically methods that attorneys can employ to keep your name out of the public record. However, please be aware that these solutions are not “one size fits all,” and often require careful planning by an experienced attorney.
If privacy is a key concern in setting up your LLC, contact an attorney that has experience in setting up LLCs in a variety of states, as there are certainly some subtle differences in state law with respect to disclosure of the names of the members of the company. In addition, note that there are differences in annual fees (Wyoming is typically less expensive).