Wyoming vs Texas LLC: Side-by-Side Comparison (2026)

If you are a non-US founder weighing a Wyoming LLC against a Texas LLC, the short answer is that Wyoming wins for almost everyone who does not physically operate in Texas, and the gap widens every year you keep the company alive. Texas is a genuinely good state to do business in, but its franchise tax machinery, its $300 filing fee, and its mandatory public ownership disclosure are built for companies that actually have people, property, or customers inside Texas, not for an overseas owner running a remote business through a US entity. Below is the honest, numbers-first comparison, with every figure checked against 2026 sources.

Why Wyoming wins for non-residents

For a founder living outside the United States with no US employees, no US office, and no physical inventory in Texas, the decision comes down to four things: recurring cost, privacy, paperwork load, and bank acceptance. Wyoming beats Texas on all four.

Recurring cost is flat and tiny. Wyoming's only annual obligation is the License Tax filed with the Wyoming Secretary of State. It is "$60 or 0.02 percent of total assets located and employed in Wyoming, whichever is greater" (Wyoming Secretary of State, Annual Report). A non-resident running a services or e-commerce business holds essentially no assets inside Wyoming, so the calculation collapses to the $60 minimum, year after year, forever. There is no state income tax, no franchise tax, and no gross-receipts tax in Wyoming.

Texas has more moving parts. Texas charges a one-time $300 Certificate of Formation fee (Texas Secretary of State, Form 806 Fee Schedule), versus Wyoming's roughly $100 state filing fee — and at WyomingLLC, the $397 all-inclusive package already covers that Wyoming state fee, so there is nothing extra to wire. More importantly, every Texas LLC must file a franchise tax report and a Public Information Report each May 15, even when it owes $0 in tax. Miss that deadline and the Comptroller assesses a $50 late penalty immediately, regardless of whether any tax was due (Texas Comptroller, Franchise Tax).

Privacy. This is where the existing assumption that "Texas does not list members publicly" is simply wrong. Texas's annual Public Information Report requires you to list the names, titles, and complete addresses of the LLC's members or managers, and that data becomes public record searchable through the Comptroller's taxable-entity lookup (Texas Comptroller, Public Information and Owner Information Reports). Wyoming, by contrast, does not require members to be named in the public formation record or the annual report, which is one of the main reasons it became the default state for privacy-conscious non-residents.

Bank acceptance. US fintech banks that routinely onboard non-resident-owned LLCs — Mercury, Relay, Wise — are deeply familiar with the Wyoming registered-agent-plus-EIN pattern. A Wyoming LLC is the path of least resistance through their KYC. Texas works too, but you gain nothing for the extra cost and disclosure.

Put bluntly: unless you have a Texas-specific reason, you are paying more and exposing more to get the same federal tax treatment.

When Texas genuinely wins

Honesty matters here, because there are real situations where Texas is the correct choice and steering you to Wyoming would be wrong.

You actually live in or operate from Texas. If you have moved to Texas, hold a US visa with Texas residency, or you have employees, a warehouse, an office, or a retail presence in the state, you have nexus in Texas. At that point a Texas LLC is not optional cleverness — it is the home state where your business already exists. Forming in Wyoming and then registering as a foreign LLC in Texas just means paying both states.

You sell heavily into the Texas market. A foreign (out-of-state) entity with $500,000 or more in gross receipts sourced to Texas has economic nexus for franchise tax purposes even with no physical presence (Texas Comptroller; Weaver, "Texas Adopts Economic Nexus Standards"). If most of your customers are in Texas and you are clearing half a million in Texas-sourced revenue, you will end up filing Texas franchise reports anyway, so the "Wyoming avoids Texas" logic evaporates.

You want local credibility or local real estate. For founders buying Texas property, raising from Texas-based investors, or building a brand that trades on being a Texas company, the in-state entity carries weight that a Wyoming shell does not.

You value the franchise-tax headroom. Texas's no-tax-due threshold is high — $2.65 million in annualized total revenue for the 2026 report year (Texas Comptroller, 2026 Franchise Tax). A genuinely Texas-based company under that ceiling pays $0 in franchise tax. That is a real benefit if you are already in Texas. It is not a reason for a non-resident to choose Texas, because Wyoming charges $0 in franchise tax at every revenue level.

In short: pick Texas when Texas is where the business physically lives. Pick Wyoming when the US entity is a remote vehicle and you live abroad.

Real 5-year total-cost projection

The table below models a non-resident-owned LLC over five years at four revenue levels. It compares a Wyoming LLC (assuming the WyomingLLC $397 all-inclusive first-year package with the Wyoming state fee included, then the $60 annual License Tax) against a Texas LLC (assuming the $300 state filing fee plus a comparable registered-agent/formation service, then the recurring Texas obligations).

Key verified Texas facts baked into the model (all 2026 figures):

• State income tax: Texas has no personal or corporate income tax. $0.
• Franchise/margin tax: Owed only above the $2.65M annualized-revenue no-tax-due threshold for report year 2026 (Texas Comptroller). Below it, $0 tax — but the report is still mandatory. The standard rate is 0.75% (0.375% for retail/wholesale); the optional E-Z computation is a flat 0.331% on revenue for entities at or under $20M (Texas Comptroller, 2026 Franchise Tax).
• Filing fee: $300 one-time Certificate of Formation (Texas SoS Form 806).
• Annual report: Texas has no separate "annual report" fee, but the franchise tax report + Public Information Report are required every May 15; a missed filing triggers a $50 penalty (Texas Comptroller).
• Public disclosure: Members/managers' names and addresses are published via the PIR (Texas Comptroller).

For the model I assume a Texas formation/agent service of roughly $300 plus the $300 state fee in year 1 (~$600 year 1), and ~$150/year afterward for registered agent plus franchise/PIR filing assistance. Wyoming assumes the non-resident holds no Wyoming-situated assets, so the License Tax stays at the $60 minimum.

The instructive takeaway is what does not show up in the Texas tax column: at $0, $50K, $100K, and $250K, a non-resident with no Texas nexus owes $0 in Texas franchise tax, because all of those are far below the $2.65M threshold. So the franchise tax is not where Texas costs you money at these levels — the compliance overhead is. Texas forces a mandatory dual filing (franchise report + PIR) every single year, with a $50 penalty for slipping, plus a higher state filing fee and (for the model) a higher recurring service cost. Wyoming's single $60 License Tax has no such report-or-be-penalized franchise machinery. Across five years the realistic delta is roughly $560+ in Wyoming's favor, before counting the privacy cost of publishing your name in Texas every year.

If a non-resident ever did cross $2.65M in Texas-sourced revenue, the margin tax would stack on top — at the E-Z rate of 0.331%, $3M in revenue is roughly $9,930 per year — a cost that simply does not exist in Wyoming at any revenue level.

For non-residents specifically

State choice changes your fees and your privacy. It does not change your US federal tax obligations, and this is the part that trips up most non-resident founders.

Federal classification and Form 5472. A US LLC wholly owned by one non-US person is, by default, a "disregarded entity" for federal tax. Since 2017, such an LLC is treated as a domestic corporation solely for reporting purposes under section 6038A. That means it must file Form 5472 attached to a pro-forma Form 1120 every year, reporting reportable transactions with the foreign owner (capital contributions, distributions, loans, etc.) (IRS, About Form 5472). The penalty for failing to file, filing late, or filing substantially incomplete is $25,000 per form — and the IRS treats Form 5472 sent without its pro-forma 1120 (or vice versa) as a failure to file (IRS, Instructions for Form 5472). For a calendar-year filer the deadline is April 15. This obligation is identical whether you form in Wyoming or Texas; it is federal, not state.

Effectively connected income and treaties. Whether your LLC's profit is taxable in the US depends on whether you have US-source effectively connected income (ECI) and on any tax treaty between the US and your home country. The US maintains a published list of income tax treaties (IRS, "United States Income Tax Treaties — A to Z"). A founder selling digital services to global customers with no US dependent agent or office often has no ECI — but this is a fact-specific determination, and you should confirm it with a cross-border tax advisor rather than assume.

Information reporting (1099-K). If you collect through US payment platforms, note the current rule: after the One Big Beautiful Bill Act repealed the planned $600 trigger, a third-party settlement organization issues Form 1099-K only when payments exceed $20,000 AND more than 200 transactions (IRS, "IRS issues FAQs on Form 1099-K threshold... dollar limit reverts to $20,000"). Not receiving a 1099-K does not make income non-taxable; you still report all income.

Banking and BOI. Wyoming's clean, member-private record is what fintech banks (Mercury, Relay, Wise) expect, smoothing KYC for an owner abroad. On beneficial-ownership reporting, FinCEN's 2025 interim final rule exempts US-formed companies and their US owners from the Corporate Transparency Act BOI filing (FinCEN, BOI Reporting). That exemption applies the same way to Wyoming and Texas LLCs.

Asset protection. Wyoming's charging-order statute is among the strongest in the country and is the sole remedy a creditor of a member can pursue against a single-member LLC interest. Texas LLC asset protection is moderate by comparison. For a founder holding the entity as a long-term vehicle, Wyoming's caselaw advantage is real.

Step-by-step: forming from abroad

You do not need to visit the United States, and you do not need a US Social Security Number to form the LLC or get an EIN.

1. Pick the state and name. For a remote, non-resident-owned business, Wyoming. Choose a name and confirm availability on the Wyoming Secretary of State business search.

2. Appoint a Wyoming registered agent. Wyoming requires a registered agent with a physical Wyoming address to receive legal mail. A formation service (WyomingLLC's $397 all-inclusive package includes the registered agent and the Wyoming state filing fee) handles this so you never need a US address of your own.

3. File the Articles of Organization. The provider submits these to the Wyoming Secretary of State. This is what legally creates the LLC. With the all-inclusive package the Wyoming state fee is already covered — no separate wire to the state.

4. Adopt an Operating Agreement. Even a single-member LLC should have one. It documents ownership and is frequently requested by banks during onboarding.

5. Get an EIN from the IRS. A non-resident with no SSN obtains an Employer Identification Number by filing Form SS-4 — typically by fax or mail, since the online tool requires an SSN/ITIN. Leave the SSN field blank and write "Foreign" where required (IRS, About Form SS-4). This is the number banks and payment platforms ask for.

6. Decide whether you need an ITIN. You do not need an ITIN to form the LLC or get an EIN. You may need an Individual Taxpayer Identification Number later — for certain tax filings or treaty positions. WyomingLLC offers ITIN support as a separate $297 add-on; only buy it if your situation actually calls for it.

7. Open a US business bank account. With the EIN, formation documents, and Operating Agreement, apply to a non-resident-friendly fintech bank (Mercury, Relay, Wise). Most onboard fully online.

8. Calendar your filings. Set reminders for the Wyoming annual License Tax (due the first day of your formation anniversary month) and the federal Form 5472 + pro-forma 1120 (April 15 for calendar-year filers).

Common mistakes

Assuming the state choice changes your federal tax. It does not. A Wyoming LLC and a Texas LLC owned by the same non-resident have identical federal obligations, including the Form 5472 + pro-forma 1120 filing with its $25,000 penalty (IRS). Picking a "tax-free state" does not exempt you from US federal reporting.

Forgetting Form 5472 entirely. This is the single most expensive error non-residents make. The disregarded-entity LLC has no income tax return of its own, which lulls owners into thinking nothing is due. The information return is still mandatory, and the penalty is $25,000 per missed form (IRS, Instructions for Form 5472).

Forming in Texas for "credibility" while living abroad. You inherit the mandatory annual franchise report, the Public Information Report that publishes your name and address, and a higher filing fee — with no offsetting benefit if you have no Texas nexus.

Believing Texas keeps owners private. It does not. The PIR discloses members/managers publicly every year (Texas Comptroller). If privacy matters, that alone is disqualifying for many founders.

Missing the May 15 Texas deadline. Even a $0-tax Texas LLC owes the filing, and a miss costs $50 plus loss of good standing (Texas Comptroller). Wyoming has no equivalent franchise-report trap.

Buying an ITIN you don't need. The LLC and EIN do not require one. Add it only when a specific filing or treaty position demands it.

Sources: Texas Comptroller — Franchise Tax, Texas Comptroller — 2026 Franchise Tax Forms, Texas Comptroller — Public Information and Owner Information Reports, Texas Secretary of State — Fee Schedule (Form 806), Wyoming Secretary of State — Annual Report, IRS — About Form 5472, IRS — Instructions for Form 5472, IRS — Form 1099-K threshold reverts to $20,000, IRS — United States Income Tax Treaties A to Z.