Once a business is incorporated in Delaware, there are generally two annual fees that business owners who operate their companies outside of Delaware need to pay in order to remain in compliance.
These are the annual Franchise Tax Fee and the annual Registered Agent Fee.
For companies that operate in Delaware in a brick-and-mortar business, home business or online business, there are additional requirements to maintain compliance, such as business licenses or permits.
Delaware Franchise Tax:
Franchise Tax is an annual fee paid to the Division of Corporations for the privilege of owning a business incorporated in Delaware. For an LLC or LP, the cost of your Franchise Tax is currently $300 per year, which is a flat-rate unrelated to the company’s income.
The LLC/LP Franchise Tax is due each year on or before June 1. If you don’t pay by the due date, you will be charged a late fee as well as interest; in addition, your Delaware company will lose its Good Standing status until the Franchise Tax Fee, late fee and interest are paid in full.
For a minimum stock corporation, (companies with 5,000 shares of stock, or less) your Franchise Tax is currently $225 a year, which is a flat-rate unrelated to the company’s income.
For a maximum stock corporation, (companies with more than 5,000 shares) your Franchise Tax will be at least $300 and can increase based on a number of factors. If your Delaware corporation Franchise Tax Fee is not paid on or before March 1 of each year, you will be charged a late fee as well as interest, and your Delaware corporation will lose its Good Standing status until the Franchise Tax Fee, late fee and interest are paid in full.
Registered Agent Fee:
The second compliance requirement for Delaware is the Registered Agent Fee. The Delaware Registered Agent’s job is to forward service of process and serve as a liaison between your company and the state of Delaware.
When we receive correspondence from the Delaware Secretary of State for your company, we will send it to the Communications Contact for your company. We will also monitor your Franchise Tax status and remind you when it’s time to pay it. Failure to pay your Registered Agent fees on time may result in penalties and/or loss of your Good Standing Status.
If you have any questions or concerns about how to keep your Delaware LLC or corporation in compliance, please feel free to call Harvard Business Services, Inc. at 1-800-345-CORP.