In what state should I establish an LLC for an online business?

Based on your facts, you may be fine with just having an entity in your state of residence. The claims about Nevada entities as being superior are generally without merit. Delaware has some advantages because of the Chancery court, extensive case law and the generally favorable statutory schemes. The benefit of Delaware really only applies if you are a public company or you have numerous investors and shareholders from multiple states. As a general rule, a business that has a sole member (shareholder or the like) is likely fine just establishing the entity in the state where they reside and do their business.

An LLC with a sole member is disregarded and it is taxed as sole proprietor. You can check-the-box for corporate taxation and then elect to be an S-corp. If this makes sense would require more facts about the business, lending, your finances and other factors.

Finally, as to registration, this is termed “qualification” of the entity. Generally, a “foreign” entity must qualify its entity in another state if it is “doing business” in that state. What is defined as doing business is primarily an issue of state statute. Your business may not have to qualify given that it sounds like it is doing business in interstate commerce which is often an exception to qualification. This, again, will depend on a close review of your business and the applicable state statutes.

You should speak with a local attorney regarding your issue. Contact people you know and trust for referrals. If you have no referrals, contact your local bar association for their referral program. Good luck.

DISCLAIMER—This answer is for informational purposes only and discusses general legal principles, trends, and considerations and is not intended as specific legal advice regarding your question. This answer does not establish an attorney client relationship. For legal advice, you should retain legal counsel in your state for advice regarding your specific circumstances.