Delaware Franchise Tax: Everything You Need to Know

There are several actions that could trigger this block including submitting a certain word or phrase, a SQL command or malformed data. The franchise tax is paid online at the Division of Corporations website. Delaware Franchise tax and Annual Report, as well as filing regulations, are essential maintenance requirements for all companies operating in Delaware. The issues involved are extremely complex and often cause problems. However, with the assistance of our business professionals at Odint Consulting, we can guide you through the procedure of filing Delaware Franchise Tax and Annual Report.

• The total cost of the corporation's Delaware Franchise Tax consists of an annual report fee and the actual tax due.
• All Delaware-incorporated businesses must, however, still pay the annual franchise tax, submit an annual report, and pay a filing fee.
• Foreign corporations, those that are formed outside of Delaware, cannot file online.
• If the estimated par value capital is lower than $1,000,000, then the tax is determined by dividing that sum by $1,000,000, then multiplying the amount by $400.00.

Delaware LLCs do not have to complete the annual report, but still pay the $300 Delaware LLC Franchise Tax fee. The State of Delaware allows you to pay the lower of the two Delaware Franchise Tax calculation methods. Therefore, if you receive a tax bill for tens of thousands of dollars, it may be in your best interest to try calculating your Delaware Franchise Tax with the assumed par value capital method. Corporations, LLCs and LPs are taxed in arrears, meaning the tax due by each due date is for the previous calendar year.

Delaware Franchise Tax: How to Calculate and Pay

Your Delaware franchise tax due date depends on the type of business you own. This article focuses on businesses that are operating solely in Delaware. If your business is operating in multiple states, your business may have "nexus" with those other is cma worth it states. This means that you're likely to need to pay taxes in those states. Foreign corporations, those that are formed outside of Delaware, cannot file online. This website is using a security service to protect itself from online attacks.

• If you’re trying to figure out if you owe Delaware franchise tax, Bench can help.
• As your Registered Agent, we will send you tax reminders both by mail and email, well in advance of the due date.
• In addition to paying the franchise tax, businesses incorporated in Delaware must also file an annual report and pay a small filing fee.

The limited partnership or LP franchise tax is also due on June 1. This is the first method that is typically used to calculate tax. Payment can be submitted with an electronic check or credit card. Harvard Business Services, Inc. guarantees your annual Delaware Registered Agent Fee will remain fixed at $50 per company, per year, for the life of your company.

Eligibility for Delaware Franchise Tax And Annual Report

If the Delaware Franchise Tax calculation uses the assumed par value capital method, the gross assets and issued shares are also to be listed. If you decide to pay your Delaware Franchise Tax for a corporation with us over the phone, the annual report would need to be separately submitted to us by email, fax or mail. A corporation with 5,001 authorized shares or more is considered a maximum stock corporation. The annual report fee is $50 and the tax would be somewhere between $200 and $200,000 per year, as illustrated below. A corporation with 5,000 authorized shares or less is considered a minimum stock corporation.

How Do I Pay My Delaware Franchise Tax?

A non-stock/non-profit company is considered exempt by the State of Delaware. This type of company does not pay the standard annual Delaware Franchise Tax, but must still file and pay the annual report fee of $25 per year. When you submit your Delaware franchise tax payment, you'll also need to submit an annual report. Delaware corporations, whether foreign or domestic, are required to pay an annual Franchise Tax. The deadline for filing annual reports is the same as that for franchise tax filing deadline which falls at or before the 1st March. Foreign companies submit annual reports to Delaware Secretary of State Delaware Secretary of State prior to the 30th day of June.

Special Cases for Delaware Franchise Tax

The Delaware Franchise Tax has no bearing on income or company activity; it is simply required by the State of Delaware to maintain the good standing status of your company. If you're ready to file and pay your Delaware Franchise Tax now, please visit our online Franchise Tax payment form. Business that are formed out of state but are registered to do business in Delaware must pay a $125 registration fee.

Do I Need to Submit Anything Else With My Delaware Franchise Tax Payment?

The franchise tax is a tax imposed by the state that is imposed on companies to allow them to legally and commercially operate in the USA or a certain regions. It is an essential requirement to be able to legally establish your company and maintain good standing in Delaware franchise tax and Annual Report. The franchise tax you pay will be determined by the nature of your company and not the amount of income the business earns. Corporations must complete an annual report along with their Delaware Franchise Tax payment.

If the tax is not paid on or before March 1, the state imposes a $200 late penalty, plus a monthly interest fee of 1.5%. If your company has authorized 5,000 shares or fewer, your total Delaware franchise tax amount is $175. A franchise tax, sometimes called a privilege tax, is a fee you pay for the privilege of doing business in a certain state. The annual franchise tax is required and paid to the state of Delaware.