Delaware

Delaware Franchise Tax Guide for LLCs

Complete 2026 guide to Delawarefranchise tax — rates, due dates, filing forms, exemptions, and how to minimize your LLC's state tax burden.

Does Delaware have franchise tax on LLCs?

Yes — $300/yr flat

Delaware Franchise Tax Structure

How it's calculated

Flat $300/yr franchise tax on LLCs (corporations have a different schedule based on authorized shares)

Due date

June 1 annually

Filing form

LLC franchise tax notice mailed by Delaware

Key Things to Know About Delaware Franchise Tax

Fixed rate makes Delaware predictable
Penalty for late payment: $200 + 1.5% interest per month
Delaware LLCs operating only out-of-state still owe the $300

Possible Exemptions

None — all Delaware LLCs owe the $300

Verify eligibility with a CPA or the Delaware Department of Revenue before claiming an exemption.

FAQ

Does my LLC owe franchise tax in Delaware?

Yes. Delaware imposes franchise tax or equivalent: Flat $300/yr franchise tax on LLCs (corporations have a different schedule based on authorized shares)

When is Delaware franchise tax due?

June 1 annually. Missed deadlines typically trigger penalties, interest, and loss of good standing. Always mark your calendar or use FormifyAI's compliance reminder service.

How do I file franchise tax in Delaware?

LLC franchise tax notice mailed by Delaware. Most states now offer online filing through their Department of Revenue or Secretary of State portal. Payment can usually be made by ACH, credit card, or check.

What happens if I don't pay Delaware franchise tax?

Failure to pay triggers: monetary penalties + interest on unpaid amounts, loss of good standing with the state, inability to file lawsuits or enforce contracts, and eventual administrative dissolution of the LLC. Administrative dissolution can retroactively pierce liability protection.

Can I avoid Delaware franchise tax by forming elsewhere?

Generally no. If your LLC operates in Delaware (has employees, office, or significant activity there), you'll owe Delaware state taxes regardless of formation state. Forming in Delaware or Wyoming to "avoid" Delaware taxes typically costs MORE (both states' fees) while providing no real tax benefit.

Are there exemptions from Delaware franchise tax?

Possible exemptions: None — all Delaware LLCs owe the $300. Consult a CPA familiar with Delaware tax law for your specific situation.

Stay compliant with Delaware franchise tax

FormifyAI tracks your Delaware compliance deadlines and sends reminders so you never miss a franchise tax filing. Plus EIN, operating agreement, registered agent, and BOI report all bundled.

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