The numbers at a glance
| Massachusetts | Delaware | |
|---|---|---|
| Filing fee | $500 | $110 |
| Annual report | $500 (annual) | $300 (annual) |
| Franchise tax min | $0 | $300 |
| Top state income tax | 9% | 6.6% |
| Privacy score | 4/10 | 7/10 |
| Banking accessibility | 9/10 | 10/10 |
| Standard processing | 7d | 10d |
| 5-year total cost | $3,250 | $3,360 |
On pure 5-year cost, Massachusetts comes out ahead by $110. But cost is rarely the only factor.
When Massachusetts wins
- Strong VC ecosystem
- You physically operate in Massachusetts — staying in-state avoids foreign-LLC qualification costs.
When Delaware wins
- Court of Chancery
- Strong corporate law
- Anonymous members allowed
- Universal bank acceptance
Hidden costs of forming in Delaware from outside
If you live and operate in Massachusetts but form in Delaware, you almost always pay both states' annual fees because you must register as a foreign LLC in Massachusetts. The advertised cost difference often disappears entirely once foreign qualification fees and dual registered agents are factored in.
Decision framework
- Operating in Massachusetts? Form in Massachusetts.
- Pure holding company or non-resident? Delaware wins for VC-backed or holding structures.
- Raising VC money? Delaware C-Corp is the standard. Massachusetts won't be accepted by most institutional investors.
See the full Delaware guide for Delaware-specific details, or jump to our 5-question quiz to get a personalized shortlist.