Choosing the Best US State for business in 2025

Choosing the right state to set up your business is a big decision, and with so many options in the US, it can get a bit overwhelming. Whether you’re just starting out or looking to scale, the right state can really give your business the boost it needs.

Delaware has long been the go-to for large corporations, Wyoming is increasingly favored by small businesses for its tax benefits, and Nevada is known for offering privacy and flexibility. These three states have consistently been at the top of the list for entrepreneurs looking to incorporate. According to Wolters Kluwer, Delaware is home to more than half of public and Fortune 500 companies, and both Nevada and Wyoming offer attractive tax advantages. 

Additionally, Investopedia reports that Wyoming is becoming a preferred choice for LLCs, thanks to its lower costs and better asset protection. 

Even Nevada, as noted by the Financial Times, remains popular for its legal advantages and favorable tax environment. Even Nevada, as noted by the Financial Times, remains popular for its legal advantages and favorable tax environment.

In this article, we’ll compare Delaware, Wyoming, and Nevada to help you understand the advantages each state offers in 2025. By the end, you’ll have a clearer picture of which one is the best fit for your business goals. And if you’re still unsure or need a hand with the process, don’t hesitate to reach out for a personalized consultation.

Delaware – the Corporate Giant

Delaware continues to be the most popular state for incorporation, and it remains the preferred choice for large corporations and those aiming to go public. The state is home to over 1.8 million legal entities, including 68% of Fortune 500 companies and more than 93% of all U.S. IPOs. So, why do so many entrepreneurs choose Delaware?

Delaware’s Court of Chancery, established in 1792, is one of the key reasons. This specialized court system focuses on business law, offering businesses legal certainty and efficiency when disputes arise. The Delaware legal framework provides decades of case law, making it one of the most trusted jurisdictions for companies.

On the financial side, Delaware offers tax benefits that make it particularly attractive to businesses. Companies that don’t operate within the state are exempt from state corporate income tax. The state also doesn’t impose sales tax, which is a significant advantage for businesses operating across state lines or internationally. Privacy protection is another major selling point, with Delaware having minimal disclosure requirements for company officers and directors.

For entrepreneurs looking to incorporate quickly, Companies can be registered in Delaware in as little as 24 to 48 hours, making Delaware a go-to for entrepreneurs needing a quick start. This quick incorporation process, coupled with a business-friendly environment, is a large part of why Delaware is the go-to state for venture-backed tech startups. Over 90% of venture capital-backed companies are incorporated here, thanks to the state’s strong legal protections for intellectual property and shareholder rights.

Delaware’s combination of speed, legal certainty, privacy protections, and tax benefits make it an enduring favorite for businesses looking to grow, scale, or go public.

Wyoming – the rising star

Wyoming has experienced impressive growth in business registrations in Wyoming, with over 200,000 new business filings in 2024 alone. The state’s appeal lies in its combination of tax advantages, asset protection, and business-friendly policies. Wyoming stands out for offering one of the best environments for entrepreneurs and small business owners.

One of the key features that attract enterprises to Wyoming is its zero corporate income tax policy. Both corporate and personal income are exempt from state taxes, making it an ideal choice for those looking to maximize their profits and minimize their tax burden. Additionally, the state’s strong asset protection laws make it one of the best in the nation for LLC protection, ensuring that owners’ personal assets are shielded from business liabilities.

Wyoming is also cryptocurrency-friendly, becoming the first state to establish banking regulations specifically designed for cryptocurrency businesses. This forward-thinking approach makes Wyoming an appealing option for tech-savvy entrepreneurs in the digital asset space.

Maintaining a business in Wyoming is affordable, with an annual report fee of just $60 for most LLCs, which is one of the lowest in the country. Privacy is another key advantage: there is no requirement to list members in public records, ensuring a higher level of privacy protection for business owners.

Wyoming’s combination of low costs, strong legal protections, and tax benefits make it an increasingly attractive destination for entrepreneurs.

Nevada – the western alternative

Nevada continues to attract businesses with its unique combination of benefits. Known for its lack of state income tax, Nevada remains an appealing choice for proprietors looking to retain more of their profits. However, the state has introduced a commercial tax, which could impact growing businesses. This new tax, while not overly burdensome for small companies, could be a factor to consider for those planning to scale their operations in the future.

Nevada is particularly appealing due to its strong privacy protections, with laws that prevent public disclosure of shareholder names. This makes it an excellent choice for individuals or businesses seeking confidentiality. Additionally, Nevada does not share information with the IRS, which further strengthens its appeal for businesses focused on privacy.

The state also offers minimal reporting requirements, such as no requirement for operating agreements to be filed, providing businesses with a simple and streamlined incorporation process. While Nevada’s formation fees (ranging from $425 to $725) are higher than some other states, it remains an attractive choice due to its business-friendly environment.

Nevada’s business court system, modeled after Delaware’s, adds an extra layer of legal security, making it an excellent location for businesses that anticipate complex legal matters. Additionally, Nevada offers strong asset protection, particularly with its charging order protection for LLCs, which is a key advantage for businesses seeking to safeguard their assets.

Nevada’s growing tech and blockchain ecosystem, alongside its strong privacy protections, continues to attract startups in industries such as cryptocurrency and tech. These trends are expected to continue driving Nevada’s popularity as a state for incorporation.

Furthermore, Nevada is an ideal location for e-commerce businesses, especially those serving the western United States. With no state income tax and a strong infrastructure for digital businesses, Nevada remains an attractive option for entrepreneurs in the e-commerce sector.

Delaware, Wyoming, and Nevada a detailed comparison

When deciding on the best state for incorporation, there are several key factors to consider. Here’s a detailed comparison of Delaware, Wyoming, and Nevada based on important criteria like taxation, fees, legal protections, and residency requirements.