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How to Complete the Delaware Franchise Tax Report
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How to Complete the Delaware Franchise Tax Report


By Amy Fountain Tuesday, January 4, 2011

Now is the time to pay and file the Delaware annual Franchise Tax report for corporations, and many peoplehave asked us how to complete the actual annual report worksheet, so we created this helpful FAQ blog.

 

What is the easiest way to pay my annual Franchise Tax fees through Harvard Business Services, Inc.?

The fastest and simplest way to pay and file the annual Franchise Tax fees is via our website at www.delawareinc.com/payft/.  By using our online step-by-step payment processing system, you will receive a discount on the Franchise Tax filing fee. We guarantee your Franchise Tax report will be filed accurately and on time with the state of Delaware.

 

What does "Principal Place of Business" mean? Can I use the address of Harvard Business Services, Inc.?

The Principal Place of Business is the physical location where the company is located. The actual street address, city, state and postal code must be indicated, as a Post Office Box address is not acceptable. The address of Harvard Business Services, Inc. may not be used, even if a Mail Forwarding service has been established.

 

Who are my officers and/or Directors?

The officers and Directors of a company are elected to manage the affairs of the corporation. The details of the officers and Directors are kept internally within the corporate record books. An officer would typically be the President, Vice President, Secretary or Treasurer of the company. For Franchise Tax filing purposes, only one officer's name and address is required to be filed on the annual report. However, all Directors' names and addresses are required to be listed on the annual report. A physical street address, including city, state and postal code, must be listed for each officer or Director. A Post Office Box address is not acceptable, and the address of Harvard Business Services, Inc. may not be used.

 

Who is authorized to sign and file the annual report?

 Your annual Franchise Tax report can be signed and filed by an officer or director of the company; however, one of the people listed in the officer and director section of the annual report is required to be the authorized signatory.

 

Where can I locate the Delaware State File Number for my company?

The Delaware State File Number is seven digits in length and typically begins with a 0, 2, 3, 4 or 5.  On the annual report worksheet, the number can be found on the upper left hand side of the page.

 

How can I determine my company’s total gross assets?

The State of Delaware Title 8 Chapter 5 § 503 (i) states “such total assets and total gross assets shall be those “total assets” reported to the United State on U.S. Form 1120 Schedule L, relative to the company’s fiscal year ending in the calendar year prior to filing with the Secretary of State pursuant to this section.  If such schedule is no longer in use, the Secretary of State shall designate a replacement.  The Secretary of State may at any time require a true and correct copy of such schedule to be filed with the Secretary of State’s office.

No corporation shall consolidate with its assets of another entity for purposes of this section.  If such schedule or its replacement reports on a consolidated basis, the reporting corporation shall submit to the Secretary of State a reconciliation of its reported total assets or total gross assets to the consolidated total assets reports on the schedule.”

 

Where can I find out how many shares my company has issued?

Typically, all information regarding a company’s stock structure can be found in the stock transfer ledger. This reference will indicate how many shares are authorized, issued, to whom the shares were issued, for how much, and other relevant information. For Franchise Tax calculation purposes of maximum stock companies (over 5000 authorized shares), only the number of issued shares are required to be provided.

 

Do I still have to pay a Franchise Tax if my company has not conducted any business?

All companies that are incorporated in the state of Delaware are required to pay an annual Franchise Tax in order to maintain their corporate existence. The annual Franchise Tax is due, regardless of whether or not the company has conducted any business, had any profit or loss, opened a bank account or filed a federal tax return.

 

I no longer want my company; do I still owe Franchise Tax Fees?

In order to formally and legally close a corporation, a Certificate of Dissolution must be filed. At the time of filing the dissolution, all past and currently due Franchise Tax Fees must be paid. Once the dissolution filing has been approved by the state of Delaware, no further Franchise Tax Fees will be imposed upon the corporation.

If you have other questions on how to complete an annual Franchise Tax report, please check out our video with easy to follow instructions.

As always, Harvard Business Services, Inc. is here to assist you via email payments@delawareinc.com or telephone at: 1-800-345-2677 or 1-302-645-7400, Extension 6904. Feel free to call one of our helpful representatives and ask any questions you may have about Delaware Franchise Taxes. 

 

More By Amy Fountain

 

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