Steps to filing the Delaware Annual Report and Franchise Tax
- Go to the Delaware Division of Corporations Website Domestic corporations can only file online. Use the link below to get started.
- Enter Business Entity File Number After clicking the “Pay taxes/File annual report” button on the Division of Corporations website, you’ll need to enter the Business Entity File Number. ...
- Enter Corporation Information ...
- Pay the Franchise Tax and Annual Report Fee ...
Full Answer
Which states have franchise tax?
The states that currently have franchise taxes are:
- Alabama
- Arkansas
- Delaware
- Georgia
- Illinois
- Louisiana
- Mississippi
- Missouri
- New York
- North Carolina
What is the corporate tax rate for Delaware?
Delaware has a flat corporate income tax rate of 8.700% of gross income. The federal corporate income tax, by contrast, has a marginal bracketed corporate income tax.Delaware's maximum marginal corporate income tax rate is the 10th highest in the United States, ranking directly below California's 8.840%.
When are Delaware LLC franchise taxes due?
The annual franchise tax of the Delaware LLC is due on June 1 every year. The annual report filing fee payable to the Secretary of State for Delaware must be paid on or before that date. The Delaware Limited Liability Company (LLC) requires an annual franchise tax payment.
What is Delaware corporate income tax?
Delaware's corporate income tax rate is 8.7% and is based on the federal taxable income of the corporation. What entities must file and/or pay Delaware corporate income tax? If your corporation is domestic or foreign and conducts business in Delaware, you'll be required to file a corporate income return.
Do you file annual reports in Delaware?
All corporations incorporated in the State of Delaware are required to file an Annual Report and to pay a franchise tax. Exempt domestic corporations do not pay a tax but must file an Annual Report. The filing fee for filing an Annual Report or Amended Annual Report for exempt domestic corporations is $25.
Are annual reports required in Delaware for LLC?
LLC/Partnership Tax Information All Domestic and Foreign Limited Liability Companies, Limited Partnerships, and General Partnerships formed or registered in Delaware are required to pay an annual tax of $300.00. There is no requirement to file an Annual Report.
What is Delaware annual franchise tax?
$300Read on to find out how much you'll pay, or visit our Delaware Franchise Tax calculator app for a quick answer. The Franchise Tax for a Delaware LLC or a Delaware LP is a flat annual rate of $300. A non-stock/non-profit company is considered exempt by the State of Delaware.
How do you calculate franchise tax in Delaware?
Divide your total gross assets by your total issued shares carrying to 6 decimal places. ... Multiply the assumed par by the number of authorized shares having a par value of less than the assumed par. ... Multiply the number of authorized shares with a par value greater than the assumed par by their respective par value.More items...
Do Delaware LLCs pay franchise tax?
Any corporation that is incorporated in Delaware (regardless of where you conduct business) must file an Annual Franchise Tax Report and pay Franchise Tax for the privilege of incorporating in Delaware. Franchise Taxes and annual Reports are due no later than March 1st of each year.
What happens if I don't pay Delaware franchise tax?
If you don't pay the Delaware Franchise Tax and file the Annual Report for two straight years, the State of Delaware will administratively dissolve the Corporation. If you have any questions about forming your new Delaware LLC, LP, or Corporation, give us a call today.
How do I avoid franchise tax in Delaware?
There are ways to reduce your Delaware franchise costs in certain circumstances. To reduce the taxes paid by a startup, use the Assumed Par Value method. This method calculates the taxes by total assets. As long as your issued shares constitute a third to half of your authorized shares, this method will save you money.
What is the Delaware Annual Report?
The Delaware Annual Report is a set of business information that must be submitted to the Division of Corporations by March 1 each year after incorporation. This report is submitted online and is due at the same time franchise tax must be paid.
Do I need to file a Delaware corporate tax return?
Every domestic or foreign corporation doing business in Delaware, not specifically exempt under Section 1902(b), Title 30, Delaware Code, is required to file a corporate income tax return (Form 1100 or Form 1100EZ) regardless of the amount, if any, of its gross income or its taxable income.
How are LLCS taxed in Delaware?
A. Delaware treats a single-member “disregarded entity” as a sole proprietorship for tax purposes. This means that the LLC itself does not pay taxes and does not have to file a return with the State of Delaware.
How are taxes calculated in Delaware?
Delaware Median Household Income If you make $2,000 or less in taxable income, you don't have to pay any state taxes. If you make between $2,000 and $5,000 the tax rate is 2.20%; up to $10,000, it's 3.90%; up to $20,000, it's 4.80%; up to $25,000, it's 5.20%; up to $60,000, it's 5.55%; and over $60,000, it's 6.60%.
Is the Delaware franchise tax paid in arrears?
Your notification of annual report and franchise tax due is sent to a corporation's registered agent in December or January of each year. Delaware requires these reports to be filed electronically. Franchise taxes are generally due in arrears for the prior calendar year.
What are the filing requirements of a Delaware LLC?
This means that the LLC itself does not pay taxes and does not have to file a return with the State of Delaware. As the sole member of your LLC, you must report all profits (or losses) of the LLC on Schedule C and submit it with your Delaware personal income tax return (Form 200).
What is an Annual Report for Delaware?
The Delaware Annual Report is a set of business information that must be submitted to the Division of Corporations by March 1 each year after incorporation. This report is submitted online and is due at the same time franchise tax must be paid.
Does Delaware require a statement of information?
Required Statement of Information Domestic Stock Corporations & Limited Liability Companies must file a complete statement of information (Annual Report) at the end of each year of operation.
How do I get a copy of my Annual Report in Delaware?
If you wish to order a copy of an annual report, please call 302-739-3073 for more information. NOTE: Alternative entities (Limited Liability Companies, Limited Partnerships, and General Partnerships) do not currently file annual reports. Annual reports are required for domestic and foreign corporations only.
When are Delaware franchise taxes due?
Franchise Taxes and annual Reports are due no later than March 1st of each year. An annual Franchise Tax Notification is mailed directly to the corporation’s registered agent. Blank Franchise Tax Returns are not available. The Delaware Division of Corporations will require all Annual Franchise Tax Reports and alternative entity taxes ...
When are Delaware corporation tax returns due?
Franchise Taxes and annual Reports are due no later than March 1st of each year.
Do corporations have to file taxes in Delaware?
Corporations incorporated in Delaware but not conducting business in Delaware are not subject to corporate income tax, [30 Del.C, Section 1902 (b) (6)] but do have to pay Franchise Tax administered by the Delaware Department of State. Any corporation that is incorporated in Delaware (regardless of where you conduct business) must file an Annual ...
Do Delaware corporations have to file annual reports?
All corporations incorporated in the State of Delaware are required to file an Annual Report and to pay a franchise tax. Exempt domestic corporations do not pay a tax but must file an Annual Report. The Annual Report filing fee for all other domestic corporations is $50.00 plus taxes due upon filing of the Annual Report.
What information is required to file a franchise tax in Delaware?
When filing a franchise tax in Delaware, all the must be submitted is the physical address of the business and the name of the registered agent. This can be a business owner or someone else. By not requiring more information, businesses that file their franchise tax in Delaware can maintain privacy.
What is Delaware Franchise Tax?
Delaware franchise tax is a tax charged by the state of Delaware for the right to own a Delaware company. The tax does not affect income or company activity. The tax is required to maintain the company's good standing in Delaware.
Why do you need to use franchise tax in Delaware?
The Delaware franchise tax is beneficial to corporations because it is a simple process to submit and calculate payment. The Delaware franchise tax is also beneficial to businesses as it is a small fee in comparison to other states.
How much is the late fee for franchise tax in Delaware?
If you pay your Delaware franchise tax late, you'll be charged a late fee. The late fee is $125.00 and a 1.5 percent monthly interest afterward.
What happens if you don't file Delaware franchise tax?
If you don't file your Delaware franchise tax on time, you will be charged a late fee.
What is Delaware's court of chancery?
Delaware has what is called a Court of Chancery. This allows the state to adjudicate corporate litigation. The corporate laws and cases decided in Delaware are often used by the Supreme Court to influence decisions.
How much does it cost to register a foreign business in Delaware?
Foreign File. Business that are formed out of state but are registered to do business in Delaware must pay a $125 registration fee. Foreign corporations, those that are formed outside of Delaware, cannot file online. To file as a foreign corporation, mail in the necessary documents.
What are Delaware franchise taxes?
A franchise tax, sometimes called a privilege tax, is a fee you pay for the “privilege” of doing business in a certain state.
Who has to pay the franchise tax?
You must pay the Delaware franchise tax if your Delaware business is one of the following:
What about the annual report?
Delaware companies must submit an annual report to the Delaware Department of State and pay a $50 filing fee, all of which should be done at the same time they pay their franchise tax. (For certain exempt corporations, the filing fee is $25.)
When are Delaware franchise taxes due?
Franchise taxes for corporations registered to do business in Delaware are due by June 30th of each year.
How much does a Delaware franchise cost?
There is a minimum tax of $175 and a minimum filing fee of $50; so there is a minimum Delaware franchise tax and annual report payment total of $225 a year for Delaware domestic corporations.
How much is the late fee for Delaware franchise tax?
If you do not file on time, there is a $200 late fee and a 1.5% interest assessed on the tax balance. If you are a small, medium, or closely held large corporation, there is no need to be paying any more than $225 total for your Delaware Franchise Tax each year.
What is the lowest tax you pay with the Authorized Shares Method?
The lowest tax you’ll pay with the Authorized Shares Method is $175. The lowest tax you’ll pay with the Assumed Par Value Method is $350. So, if your tax statement says you owe more than $350, it may be worth your time to calculate your tax based on the Assumed Par Value Method.
How much is the penalty for filing a Delaware tax return late?
There is a $200 penalty if you miss the deadline for filing, and 1.5% a month interest on the amount due. The Division of Corporations pull in a TON of money off hammering people with late fees and interest. As your Delaware registered agent, we send you a ton of reminders to file this to hopefully save you some money. Don’t waste $200 on late fees. Just get it filed and move on.
How to find business entity file number?
Enter Business Entity File Number#N#After clicking the “Pay taxes/File annual report” button on the Division of Corporations website , you’ll need to enter the Business Entity File Number. This can be found by performing a business name search. The number will be highlighted as part of your business’ name search result.
Can a foreign corporation file for Delaware?
However, foreign corporations (corporations formed in another state or jurisdiction) cannot file online. The foreign corporation form gets mailed to us, and we scan it into your online account. You can print it out and mail or fax it into the state of Delaware with the payment. Franchise taxes for corporations registered to do business in Delaware are due by June 30th of each year.