Wyoming regular LLC vs "Close LLC"

[Topcat]

I ran a search for this topic and couldn't find any threads, so I guess it's worth it's own thread.

Wyoming offers 2 types of LLC - the standard type that other States offer, plus this other type: a "Close LLC". Wyoming is the only State that offers this other type of LLC.

The agent I'll use to set up my LLC say that they recommend a Close LLC to everyone. It's the same setup price as a regular one. But I'm still unsure of which type to set up.

Is anyone here familiar with the Wyoming 'Close' LLC? Should I be setting one of these up, or just a regular LLC?

I'll be the only member of my company. Non-US based, no US based employees, no factory there. Selling digital products online, to US and non-US customers.

Any light anyone could shed on this topic would be most appreciated.

Many thanks

 

[Sols]

The main differences are restrictions in transfer/changes of ownership/membership, max 35 members, and some minor bureaucratic simplifications. It probably doesn't matter either way in your case.

 

[Topcat]

The main differences are restrictions in transfer/changes of ownership/membership, max 35 members, and some minor bureaucratic simplifications. It probably doesn't matter either way in your case.

Thanks. So with a Close LLC, let’s say one day I want to sell the company. Would selling it be more difficult due to the restrictions on change of ownership?

 

[Sols]

Thanks. So with a Close LLC, let’s say one day I want to sell the company. Would selling it be more difficult due to the restrictions on change of ownership?

Yes, that is correct.

 

[Topcat]

Yes, that is correct.

So from a selling the LLC one day point of view, it’s better to set up the regular LLC rather than the “close” LLC. The agent is adamant that “close” LLC is better though, and that’s the thing that’s making it difficult to decide.

Which would you pick?

 

[Sols]

So from a selling the LLC one day point of view, it’s better to set up the regular LLC rather than the “close” LLC. The agent is adamant that “close” LLC is better though, and that’s the thing that’s making it difficult to decide.

What reason are they giving for saying it's better?

Which would you pick?

Nine times out of ten, go with the standard, most common setup (which is a normal LLC, not a close LLC). Unless you see a very compelling reason to pick Close LLC, go with the normal. Maybe consider another agent.

 

[Topcat]

What reason are they giving for saying it's better?

Here is what they gave as their reasoning:
Our attorneys advise that you form close LLC. The Close LLC is a particular type of LLC in Wyoming, and we recommend it to everyone. Close LLCs are not required to hold an annual meeting, and though that benefits everyone, it is especially helpful for LLCs owned by those that know each other well and are consistently discussing business operations ('Kitchen-Table LLCs').


Additionally, should a member pass away or attempt to sell their interest in the LLC, the other members have right of first refusal to ensure the LLC remains "close" and no one wakes up one day with an outsider involved in the company.

—-

Do you see that as compelling enough reasoning to start a Close LLC, or you’d stick with the standard one?

 

[Jbb1]

Is the LLC you are forming a single-owned LLC?

If this is the case it shouldn't matter which one you choose.

 

[Topcat]

Is the LLC you are forming a single-owned LLC?

Yes, I’ll be the only member of the LLC. I guess it would make sense to go with the standard one, just so it’s easily recognisable to the likes of Stripe, banks etc?

 

[Jbb1]

Yes, I’ll be the only member of the LLC. I guess it would make sense to go with the standard one, just so it’s easily recognisable to the likes of Stripe, banks etc?

You will get accepted with either, but I think you are good to go with the standard.

 

[Sols]

Do you see that as compelling enough reasoning to start a Close LLC, or you’d stick with the standard one?

I'm not convinced. That sounds like bad advice, because it's generic and not based on your specific circumstances and your stated expectations/requirements.

 

[Topcat]

I'm not convinced. That sounds like bad advice, because it's generic and not based on your specific circumstances and your stated expectations/requirements.

Then it’s decided, standard is best. Doesn’t make much difference either way though.

Thanks one and all for the help