Tax
Delaware Franchise Tax
Quick definition
Annual tax for Delaware corporations, often quoted wildly too high if calculated incorrectly.
Delaware franchise tax applies to all Delaware-incorporated C-Corps. The default 'authorized shares' method can produce enormous bills for startups. Most startups should use the 'assumed par value capital' method, which is typically 10–100x cheaper. Due March 1 annually.
Related tax terms
R&D Tax Credit
Federal credit for qualified research expenses, usable against payroll tax by startups.
Nexus (Sales Tax)
The connection with a state that triggers a tax-collection obligation.
QSBS (Qualified Small Business Stock)
Tax exemption for gains on qualifying startup stock held 5+ years.
Section 83(b) Election
Tax election for restricted stock holders to be taxed on grant-date value instead of vesting value.
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Annual DE filing due?
We handle DE franchise tax and the annual report for every entity type, using the assumed-par-value method to minimize what you owe.
