What is an Anonymous LLC?

An anonymous LLC is a Limited Liability Company (LLC) that does not publicly reveal the names of its owners. 

In most states, when you register a Limited Liability Company the owner’s name and address will be made public record, which means their information can be found through an online search. 

However, in a few states, the state doesn’t require the identity of the owners when registering an LLC. It’s worth noting that there isn’t a special LLC called an anonymous LLC, but some marketing genius came up with a catchy term to help sell more LLCs. Other names for anonymous LLC include confidential LLC or private LLC. 

And, just like a “regular” Limited Liability Company, the “anonymous” LLC enjoys all of the same benefits such as:

• Limited liability protection for the personal assets of the business owners
• Tax flexibility (the choice of pass-through taxation or corporate taxation)
• Ease of management (compared to a corporation)

While anonymous LLCs offer many benefits, they also have some drawbacks. 

We will go over the basics of the anonymous LLC, the pros and cons, how to form one, and more. 

What Are the Pros and Cons of an Anonymous LLC?

Let’s take a look at some of the pros and cons of owning an anonymous LLC. 

PROS: 

1. Liability Protection – Just as with a regular LLC, one of the main benefits of this business entity is the asset protection it provides. If the business fails or is sued, the owner’s personal assets are generally protected from creditors (unless a personal guarantee was provided to secure a business loan). 
2. Privacy – The name and address of the owners are hidden from public view. 

This additional layer of privacy protection does not mean the owners can’t be found or won’t be held accountable for lawsuits from the actions of the business. And while it’s possible to keep your name out of public records when you form an LLC, it’s very difficult for an LLC owner to be completely hidden as there are a number of business registrations that require the personal contact information of at least one owner. 

For instance, in order to file business taxes, the Internal Revenue Service (IRS) will either need the owner’s social security number or Employer Identification Number (EIN). 

CONS: 

There aren’t any major cons to owning an anonymous LLC over a traditional LLC as they are the same entity. It just comes down to the state not publically listing the owner’s name and address.  

The one con could relate to verifying the ownership information for the LLC. Where this may be an issue is when opening a business bank account. The government has become more strict on knowing their customer and as such a bank will have to obtain additional information before opening an account or making a loan. 

In non-anonymous states, that bank will check the public database, but in an anonymous state, that isn’t an option. Every bank will be different, but this isn’t usually a huge issue. became much stricter about tracking who owns businesses and finances after 9/11. 

How to form an anonymous LLC?

After reading this, many people will still be interested in opening an anonymous LLC for the additional privacy it provides. There are many reasons someone would not want their name publically attached to their business, such as:

• Someone working for someone and are starting a business on the side. Having their boss find out they have a business may not be a good thing
• Not wanting their spouse or ex to know
• Starting a business that may be embarrassing if friends found out they owned
• Wanting to minimize having personal information found online for harassment prevention or to avoid stalkers
• Landlords, especially those with a property manager, who do not want to be contacted by tenants

In most cases, it’s better to form an LLC in the home state where you reside and will be doing the work. However, if you are looking to keep your name private when starting a business, using a commercial registered agent service will work in most states. 

If you are still reading and want to open an anonymous LLC, there are only four states that are considered anonymous. They are:

• Delaware
• Nevada
• New Mexico
• Wyoming

You can click on the links of these states to learn how to form an LLC in those states or work with an attorney, or LLC formation service specializing in these states.