Delaware · Franchise Tax · Middletown office
Delaware franchise tax, tracked and reserved in your books.
Every Delaware entity owes an annual franchise tax — a flat $300 for LLCs, LPs, and GPs (June 1), and $175 to $200,000 for corporations by one of two methods (March 1, with an annual report). We don’t file it and we’re not your registered agent — we track and reserve the liability in QuickBooks so it’s never a surprise, and confirm the method that produces the lower corporate tax. Served from our Middletown office across all three counties.
Independent firm · not Intuit. Not a registered agent. Does not file the franchise tax or annual report.
Delaware franchise tax, in brief.
TechBrot tracks and reserves the Delaware franchise tax in your own QuickBooks file — accrued so the annual bill is funded, not a surprise — and confirms which corporate method produces the lower tax: a flat $300 for LLCs, LPs, and GPs (due June 1, no annual report), or $175 to $200,000 for corporations under the Authorized Shares or Assumed Par Value method (due March 1, with an annual report). We do not file the franchise tax or the annual report, and we are not a registered agent — your registered agent or CPA files. The full Delaware franchise-tax summary is below.
Reviewed by the Certified QuickBooks ProAdvisor team at TechBrot Inc., a Delaware-incorporated independent firm — not affiliated with Intuit Inc. Delaware franchise-tax facts (the flat $300 LLC/LP/GP tax due June 1; the $175 Authorized Shares / $400 Assumed Par Value corporate minimums, $200,000 maximum, due March 1 with an annual report; the two-method election) are verified against the DE Division of Corporations and reviewed periodically; TechBrot does not file the Delaware franchise tax or annual report, is not a registered agent, and does not represent clients before the Division of Corporations.
Delaware franchise tax, in five questions.
What is the Delaware franchise tax?
It’s an annual tax every Delaware entity owes for the privilege of being formed in Delaware — not a tax on income or sales. Every LLC, LP, GP, and corporation registered in Delaware owes it each year to keep the entity in good standing, whether or not it operates in the state.
How much is the Delaware franchise tax?
LLCs, LPs, and GPs pay a flat $300, due June 1, with no annual report. Corporations pay a $175 minimum (Authorized Shares method) or a $400 minimum (Assumed Par Value method), up to a $200,000 maximum ($250,000 for a Large Corporate Filer), due March 1 with an annual report. Corporations choose whichever method gives the lower tax.
Does TechBrot file the Delaware franchise tax or annual report?
No, and TechBrot is not a registered agent. Your registered agent or CPA files the franchise tax and the annual report. What we do is track and reserve the liability in QuickBooks so the bill is funded when it’s due, and confirm the corporate method that produces the lower tax.
Which franchise-tax method should a Delaware corporation use?
Whichever produces the lower tax. The default Authorized Shares method can generate a very large bill for a corporation with many authorized shares, while the Assumed Par Value method often drops it sharply — sometimes to the $400 minimum. We confirm which method the books support before the filing.
What happens if the Delaware franchise tax is paid late?
A corporation that misses the March 1 deadline faces a $200 penalty plus 1.5% interest per month on the unpaid balance, and the entity can lose good standing. Reserving for it in the books and confirming the lower method ahead of the deadline is how businesses avoid both.
The short version.
The Delaware franchise tax is an annual tax every Delaware entity owes for the privilege of being formed here — separate from income tax and from the gross receipts tax. LLCs, LPs, and GPs pay a flat $300, due June 1, with no annual report. Corporations pay a $175 minimum under the Authorized Shares method or a $400 minimum under the Assumed Par Value method — up to a $200,000 maximum ($250,000 for a Large Corporate Filer) — due March 1 with an annual report. A corporation may use whichever of the two methods produces the lower tax, and the gap between them can be enormous. TechBrot does not file the franchise tax or the annual report, and is not a registered agent — your registered agent or CPA files. What we do, from our Middletown office, is track and reserve the liability in your QuickBooks file so it’s never a surprise, and confirm the method that produces the lower corporate tax. Served across New Castle, Kent, and Sussex counties, from $300 a year.
Why the franchise tax trips up so many Delaware entities
The Delaware franchise tax catches entities out for three reasons. First, the two corporate methods produce very different bills — the default Authorized Shares method can return a five-figure number that the Assumed Par Value method cuts to a few hundred dollars. Second, the dates and obligations differ by entity type: LLCs, LPs, and GPs pay a flat $300 by June 1 with no report, while corporations file by March 1 with an annual report. Third, it’s a balance-sheet liability that is nobody’s job by default — the registered agent files it but doesn’t keep your books, so without a reserve the bill lands unplanned.
Because the tax is owed simply for being a Delaware entity, it applies even to companies that never operate in the state — the millions of holding companies and out-of-state-owned entities formed here owe it every year, often across several entities at once.
None of this is a reason to avoid forming in Delaware — it’s a reason to reserve for the tax and confirm the right method. When the franchise tax is accrued in the books and the lower-tax method is verified, the annual bill is funded and predictable instead of a surprise.
Authorized Shares vs Assumed Par Value.
Corporations may compute the tax two ways and pay the lower. The default Authorized Shares method can produce a five-figure bill for a company with many authorized shares; the Assumed Par Value method often drops it sharply, sometimes to the $400 minimum. The fix is confirming which method the books support before filing.
June 1 vs March 1 — and a report.
LLCs, LPs, and GPs pay a flat $300 by June 1 with no annual report; corporations pay $175 to $200,000 by March 1 with an annual report. Miss a corporate deadline and a $200 penalty plus 1.5%/month interest accrues, and good standing is at risk. The fix is the right date on the calendar and the reserve ready.
Nobody’s job by default.
Your registered agent files the tax but doesn’t keep your books, so without a reserve the annual bill lands unplanned — multiplied across every entity in a holding structure. The fix is accruing the franchise tax monthly in QuickBooks so each entity’s bill is funded when it’s due.
How we help with the Delaware franchise tax.
TechBrot handles
- Franchise-tax liability tracked and reserved in QuickBooks, accrued monthly
- The lower-tax corporate method (Authorized Shares vs Assumed Par Value) confirmed against the books
- Share, par-value, and entity details kept in the books ready for the filing
- The reserve reconciled to the actual amount due each year
- A separate franchise-tax reserve tracked per entity for holding-company / multi-entity structures
- Figures coordinated with your registered agent or CPA, who files
Your registered agent or CPA handles
- Filing the franchise tax or paying it on your behalf
- Filing the Delaware annual report (your registered agent or CPA files it)
- Acting as your registered agent — TechBrot is not one
- Filing the Delaware 8.7% corporate income-tax return or federal returns
- Representation before the Division of Corporations
- Legal or formal tax opinions — bookkeeper vs accountant →
Automation handles the data entry. We handle the judgment.
Software can post a payment once the bill arrives; it can’t tell you that your corporation is on the wrong calculation method, or that a holding structure has five separate franchise-tax bills to reserve for. That judgment — knowing which method the books support and what each entity owes — is what keeps the franchise tax from becoming an annual surprise.
Once the franchise tax is accrued every month and the lower-tax method is confirmed, the question shifts from “what’s the bill this year?” to “is the structure still the right one?” That’s where clean per-entity books become real decisions — whether to consolidate dormant entities, how the franchise tax and the 8.7% corporate income tax land together, and what a new entity will cost to carry. Explore fractional CFO & advisory →
Reviewed by the TechBrot Certified ProAdvisor team.
Reviewed and maintained by the accounting team at TechBrot Inc., an independent Certified QuickBooks ProAdvisor and bookkeeping firm with an office in Middletown, Delaware, serving New Castle, Kent, and Sussex counties. Delaware franchise-tax figures — the flat $300 for LLCs, LPs, and GPs due June 1; the $175 Authorized Shares and $400 Assumed Par Value corporate minimums, the $200,000 maximum, and the March 1 due date with an annual report — reflect rules current as of the date below and are reviewed periodically against the Delaware Division of Corporations. This page is educational and operational; it is not tax or legal advice. TechBrot tracks and reserves the franchise tax in the books and confirms the lower-tax method; it does not file the franchise tax or the annual report, is not a registered agent, and does not represent clients before the Division of Corporations — your registered agent or CPA files.
Reviewer
Certified QuickBooks ProAdvisor team · Middletown, DE office · New Castle, Kent & Sussex counties
Standards
Verified vs the DE Division of Corporations · reviewed periodically · no fabricated data
Out of scope
Does not file the franchise tax or annual report · not a registered agent · no representation before the Division of Corporations · coordinated with your agent/CPA
Independence
Independent Certified QuickBooks ProAdvisor firm · Not affiliated with Intuit Inc.
Delaware gross receipts tax help
Delaware’s tax in place of a sales tax — tracked by activity category in QuickBooks so the right rate and exclusion apply and the return reconciles.
Holding companies & incorporation
Per-entity books, intercompany structure, and a franchise-tax reserve for the holding companies and registered entities Delaware is known for.
Talk to a ProAdvisor
One call tells you exactly where your books stand.
No form, no sales script. You speak with a Certified QuickBooks ProAdvisor who has looked at files like yours — and you get a written fixed-fee scope within one business day.
(877) 751-5575Mon–Fri · we reply the same business day
- You talk to a ProAdvisorA real Certified QuickBooks ProAdvisor — not a call centre.
- We review your fileWe look at what’s actually in your QuickBooks and what it needs.
- You get a written scopeA fixed fee in writing within 3 business days. Then you decide.
Delaware franchise tax questions.
What is the Delaware franchise tax?
How much is the franchise tax for an LLC versus a corporation?
Does TechBrot file my franchise tax or annual report?
How much does Delaware franchise tax help cost?
Why did my corporation get a huge franchise-tax bill?
What happens if I pay the Delaware franchise tax late?
Do I owe the franchise tax if my Delaware company operates from another state?
Get your Delaware franchise tax tracked and reserved.
Book a free books review. We check whether your franchise tax is reserved in the books and whether the lower-tax corporate method is being used, then send a written fixed-fee quote within 3 business days. No pitch. Independent firm — not a registered agent; does not file the franchise tax or annual report; coordinates with your CPA and agent.