Seed-Stage Tax Return Guide

Why Pre-Revenue Startups Must File Tax Returns

• Federal and state tax returns are required for every incorporated entity regardless of revenue — failure to file triggers penalties and can jeopardize your corporate good standing.
• Filing establishes your tax basis, net operating loss (NOL) carryforwards, and credit elections that will reduce your tax liability once the company becomes profitable.
• Investors and acquirers will request copies of all prior tax returns during due diligence — missing filings are a red flag that can delay or derail transactions.
• State tax return requirements vary: you must file in your state of incorporation (typically Delaware), your headquarters state, and any state where you have employees or nexus.