The Delaware annual report and franchise tax are due on March 1 for all domestic corporations. Domestic corporations must file the Delaware annual report and franchise tax online. Delaware business taxes can include a franchise tax, a corporate income tax, and other annual taxes and fees.

  • A second method for calculating taxes, called the Assumed Par Value Method, requires a corporation to report total issues plus total gross assets.
  • Above are the compliance requirements at the State level only.
  • A registered agent is a person or company that accepts legal and official mail on your business’s behalf.
  • According to the Delaware Division of Corporations, nearly 67% of Fortune 500 businesses are incorporated there.
  • As a foreign corporation, the annual report and filing fee must be submitted by mail.

Making sure you comply with this requirement is essential to avoid penalties or the dissolution of your company. One reason for filing a reinstatement is that your LLC faced dissolution due to non-filing of the Annual Franchise Tax or paying taxes. There are two possible reasons you might want to change your LLC’s assigned registered agent.

Why Does A Delaware LLC Need To File An Annual Report?

After putting in all the information, you must review it to ensure accuracy. Once you have confirmed it, you can agree with the terms and conditions and submit it. Also, when you obey the rules by submitting an Annual Report, it can give you legal protection and help you to avoid penalties. If you’re thinking about starting an LLC in Delaware, you can follow the steps below to learn how to successfully get everything set up. Plus, we’ll break down the benefits of starting an LLC in Delaware and why so many businesses choose to do so. Our partners cannot pay us to guarantee favorable reviews of their products or services.

Delaware LLC Annual Report: Everything You Need to Know

We are going to share some important reasons why you should file an annual report. All corporations incorporated in Delaware must file an annual report and pay a franchise tax along with it. The taxes and annual reports must be received by the Delaware Division of Corporations no later than March 1st of each year. Foreign corporations are required to file an annual report by June 30 of each year. Corporations and nonprofits registered in Delaware must file their annual report online with the Delaware Secretary of State by March 1, 2023.

Incorporation Fee Breakdown

Withholding tax is imposed on the payments or wages paid to residents or non-residents. Employers of an LLC will withhold an estimated amount of tax from those Delaware LLC Annual Report: Everything You Need to Know payments or wages, then pay it to the Division of Revenue. Keep your bylaws, meeting minutes, and other important corporate papers in a corporate records book.

Each quarter, use Form UC-8 to report on wages and pay the UI taxes. Review the Unemployment Insurance Employer Handbook for more detailed instructions. In addition to offering lower taxes compared to other states, Delaware is considered a tax shelter. The definition of a tax shelter is any method used to reduce the amount of income that is taxable. Making smart use of tax shelters means you pay less taxes and maximize your LLC’s profits. To claim S corporation tax status for your LLC, you first have to file a special form with the IRS.

To incorporate in Delaware, here’s everything you need to know.

LLCs may choose to be treated as an S corporation for tax purposes. While this may have benefits in other respects, an LLC that elects corporation status must also pay Delaware’s corporate income tax. Another advantage of starting a business in South Dakota is its 0% corporate tax rate. So, this is a great option for creating an LLC that gets taxed as a corporation.

Delaware LLC Annual Report: Everything You Need to Know