Convert LLC to C-Corp: CO Founder Pair Delaware

Converting your co-founder pair LLC to a C-Corp in Delaware by 2026 can be a strategic move as your business evolves. Delaware is the preferred state for incorporation, especially for C-Corps seeking venture capital, due to its established legal system and business-friendly environment. This guide outlines the process, tax implications, and equity restructuring considerations for a smooth transition. Check out our guide on incorporating in Delaware for step-by-step instructions. Let Lovie streamline your Delaware C-Corp formation with AI-powered precision, handling everything from filings to compliance.

When to Convert

Seeking Venture Capital: Most venture capital firms prefer investing in C-Corps due to their established corporate structure and familiarity. Converting makes your company more attractive to investors.
Planning for an IPO: C-Corps have a more straightforward path to an Initial Public Offering (IPO) compared to LLCs.
Complex Equity Structure: If your co-founder equity structure is becoming complex (e.g., with employee stock options), a C-Corp provides a more scalable framework.
Expanding Operations Nationally/Internationally: C-Corps are generally easier to manage when expanding into multiple states or countries due to their standardized corporate structure.
Attracting Top Talent: Offering stock options is a common way to attract and retain top talent. C-Corps are better suited for issuing stock options than LLCs.

Conversion Steps

LLC Member Approval: The LLC members (co-founders) must formally approve the conversion to a C-Corp. This typically requires a unanimous vote, but review your LLC operating agreement for specific requirements.
Name Availability Check: Ensure your desired C-Corp name is available in Delaware. You can check name availability on the Delaware Division of Corporations website.
Draft Certificate of Incorporation: Prepare the Certificate of Incorporation for your C-Corp. This document outlines the corporation's name, purpose, registered agent, authorized shares, and other key details. Lovie can draft this for you, ensuring compliance with Delaware law.
File Certificate of Incorporation: File the Certificate of Incorporation with the Delaware Division of Corporations. The standard filing fee is $89, but expedited options are available for faster processing.
Obtain EIN from IRS: Apply for an Employer Identification Number (EIN) from the IRS. This is required for tax purposes and to open a corporate bank account. Lovie's $499 one-time fee covers the state filing fee, a year of registered agent service, your EIN application, five scanned mailpieces a year, and one domain name for a year. It is the same price in every state.
Adopt Bylaws and Appoint Directors: Create corporate bylaws that govern the internal operations of the C-Corp. Appoint the initial directors who will oversee the company's management. For a co-founder pair, this will likely be yourselves.
Transfer Assets and Liabilities: Formally transfer all assets and liabilities from the LLC to the newly formed C-Corp. This includes bank accounts, contracts, and intellectual property. Ensure proper documentation for the transfer.

Start your formation with Lovie — $499 one-time, state filing fee included.

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