Every Delaware Corporation that is incorporated in the state of Delaware is required to file a Delaware Annual Report and pay a Delaware Franchise Tax every year by March 1 for the previous year. The amount of the Franchise Tax due is based on the number of shares the corporation has authorized. Minimum stock corporations (5000 shares or under) are required to pay $75 for the tax year 2013 ($175 in 2014) plus a $50 Annual Reporting fee.
The Delaware Franchise Tax
To file your Corporation Franchise Tax, first find your seven-digit Delaware file number. This is a number unique to only your corporation. It will be needed to ensure you are filing the report for the correct corporation.
The Delaware Annual Report
When filing the Annual Report online there is certain information that Delaware will require. You will be prompted to enter:
- Principal place of business – The actual physical address where the company is located.
- Officer of the company – Delaware requires one officer’s name, usually the President, Vice President, or Secretary as well as their address and title.
- Directors – All directors that have been elected must be entered along with their addresses. If no directors have been elected as of yet, then the report can be marked as “none”. Note that the list of directors is current as of the filing date, not backdated to the end of the previous year.
- Authorized person – Delaware requires the information of the officer or director who is authorizing the filing.
If the Annual Report is not filed and the Franchise Tax paid by March 1 Delaware will then impose a $125 penalty plus interest. Once the filing has been completed, a confirmation email is sent by the Delaware Division of Corporations to you. The Annual Report is then kept on electronic file at the Delaware Secretary of State’s office.
Note that Delaware requires this report be filed online and that the fee be paid online. This is due regardless of whether the corporation is conducting business. It is required to keep the charter in good standing with the State of Delaware, which is essential for asset protection.
If you have any questions about this filing or need help, for a small service fee your Delaware registered agent is available to assist and can file this report for you. Do not be intimidated by this. Even PhD educated customers of ours have basic questions about this. We are here to help and make the process fast and easy.
Should you have a larger number of authorized shares, we can also help you recalculate the franchise tax based on the issued shares and assets of your company and using the “assumed par value” method which often reduces the stated amount due.
Should you need to dissolve or convert your Delaware Corporation, you will also need to pay the franchise tax and file the annual report. We can help with all of your Delaware corporate filing needs.