Texas LLC vs Wyoming LLC (2026 Comparison)

Both Texas and Wyoming boast "no state income tax" and are highly business-friendly. However, their approaches to privacy, filing fees, and franchise taxes are completely different. Which one should you choose?

Updated May 2026 • 9 min read

Quick Answer

If you live in Texas, you should form a Texas LLC. Forming a Wyoming LLC to save money won't work, because you will still have to pay $750 to register the Wyoming LLC in Texas as a foreign entity. If you do not live in the US, you should form a Wyoming LLC because it is cheaper ($100 vs $300) and offers better privacy.

Key Points for 2026

Formation Cost: Wyoming ($100) is one-third the cost of Texas ($300).
Privacy: Wyoming allows anonymous LLCs. Texas requires member/manager names to be public.
Franchise Tax: Texas imposes a franchise tax on gross revenue (though the threshold is high at $2.47M). Wyoming has no franchise tax.
Maintenance: Wyoming charges $60 minimum a year. Texas is essentially free to maintain (if under the tax threshold), but the paperwork is more complex.

Cost Comparison Breakdown

Texas LLC Costs

Initial Filing Fee: $300
Annual Report Fee: $0
Franchise Tax: $0 (if revenue is under ~$2.47 million)
Note: You must file a complex Franchise Tax Report and Public Information Report every year to maintain the $0 fee.

Wyoming LLC Costs

Initial Filing Fee: $100
Annual Report Fee: $60 minimum
Franchise Tax: None.

The Foreign Qualification Rule

A common mistake is a Texas resident forming a Wyoming LLC to save $200 on the filing fee. By law, because you are managing the business from Texas, you must register the Wyoming LLC in Texas. The foreign registration fee in Texas is $750. By trying to save $200, you ended up spending $850.

The Privacy Difference

Texas is terrible for privacy. Every year, you must file a Public Information Report that lists the names and addresses of the LLC's managers or members. This database is easily searchable by the public.

Wyoming does not collect or publish the names of LLC members. The only name on the public record is your Registered Agent.

Pro Tip: If you live in Texas but desperately want privacy, you can use a "Double LLC" strategy. You form an anonymous Wyoming LLC, and then that Wyoming LLC acts as the sole member/manager of your public Texas LLC. This is expensive but effective.

Example Scenario

Scenario A: David lives in Austin, Texas and runs a local plumbing business. He should form a Texas LLC. It costs $300 once, and $0 a year to maintain. He will pay no state income tax.

Scenario B: Elena lives in Germany and wants to start an Amazon FBA business. She should form a Wyoming LLC. She gets total privacy, the lowest fees ($100 to start, $60 minimum/year), and doesn't have to deal with the complex Texas Franchise Tax reports.

What to Do Next

If you live in Texas: Form your Texas LLC here.
If you live abroad: Form your Wyoming LLC. Ensure you hire a registered agent in Wyoming.

Texas vs Wyoming FAQs

Do I have to pay Texas Franchise Tax if I have a Wyoming LLC?

If you physically live and work in Texas, yes. Even if you form a Wyoming LLC, you must register it as a foreign entity in Texas. Texas will subject your Wyoming LLC to the Texas Franchise Tax rules because you have nexus there.

Which state is cheaper to form an LLC?

Wyoming is much cheaper. Wyoming costs $100 to form. Texas costs $300 to form.

Does Texas have an annual report fee?

No. Texas does not have a standard annual report fee for LLCs. However, you must file a Public Information Report (PIR) and a Franchise Tax Report every year, even if you owe $0 in tax.

Can I keep my name off the public record in Texas?

No. Texas requires you to list the governing persons (managers or members) on the Public Information Report every year. If you want true privacy, you must use a Wyoming LLC (or a two-tier Wyoming/Texas setup).