Delaware LLC via Firstbase — Vietnamese Freelance Developers
Vietnamese developers billing US enterprise clients occasionally pick Delaware for the state brand credibility on procurement paperwork. Wyoming provides the same tax outcome at $290/year lower cost; Delaware wins only if the client explicitly requires it.
US tax: LLC pays $0 federal tax when non-ETBUS with no effectively connected income. Form 5472 + pro-forma 1120 mandatory yearly under IRC §6038A; $25,000 penalty. Delaware franchise tax is a flat $300 plus $50 report.
Vietnam side: Circular 111/2013 taxes worldwide personal income 5-35% on distributions; SBV Circular 20/2015 requires reporting outbound capital above USD 3,000.
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What the tax authority sees
A Delaware LLC owned by a Vietnamese resident owes no US federal tax when non-ETBUS with no effectively connected income; Form 5472 (IRC §6038A) mandatory yearly plus Delaware franchise tax $300.
Circular 111/2013 on foreign-source income; USD conversion rules
Delaware brand helps for US enterprise sales but adds $290/year over Wyoming with no tax offset; Circular 111/2013 governs Vietnam-side taxation.
- 01Form 5472 penalty $25,000 per year (IRC §6038A)
- 02Circular 111/2013 progressive 5-35% on worldwide personal income when distributed
- 03SBV Circular 20/2015 outbound investment reporting above USD 3,000
- 04Delaware annual $350 fixed floor with no offsetting Vietnamese benefit
From filing to funded bank account
US LLC (Delaware) vs Estonia OÜ (e-Residency)
FAQ
Not for solo freelancers. Delaware brand recognition matters mainly in US enterprise procurement and VC contexts. For a solo Vietnamese developer invoicing SMB clients through Stripe, Wyoming does the identical job at $290/year lower total cost.
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