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.
The engagementDelaware · Franchise Tax · delivered remotely
Delaware franchise tax, tracked and reserved in your books.
Delaware corporations owe an annual franchise tax of $175 to $200,000 ($250,000 for a Large Corporate Filer) by one of two methods, due March 1 with an annual report; Delaware LLCs, LPs, and GPs owe a flat $400 annual tax by June 1. Tax-ready bookkeeping and documentation support only — no tax-return preparation, filing, tax representation or tax advice. TechBrot does not prepare or file tax returns; we work with your CPA or EA. We track and reserve the liability in QuickBooks and keep the share and asset figures both corporate methods use ready for whoever files; we are not a registered agent. Delivered remotely.
State rule
Delaware rule: every corporation incorporated in Delaware must file an annual report and pay franchise tax by March 1, with a minimum of $175 under the Authorized Shares method or $400 under the Assumed Par Value Capital method and a maximum of $200,000 ($250,000 for a Large Corporate Filer); the books accrue the reserve monthly. Source: Delaware Division of Corporations.
What you can check before you sign
- Fixed fee, written first
- Your own QuickBooks file
- No hourly billing
If your file needs our paid diagnostic first, its fee is credited in full against the cleanup. Either way, you get a fixed fee in writing before any work starts.
§ 01 · In brief
Delaware franchise tax, in brief.
§ In brief
The Delaware franchise tax is owed for being formed in Delaware: a flat $400 a year for LLCs, LPs and GPs, due June 1, or $175 to $200,000 for corporations ($250,000 for a Large Corporate Filer), due March 1. TechBrot accrues it monthly in your own QuickBooks file; your registered agent or CPA files.
They took something that felt overwhelming to me as a first-year business owner and made it simple.
What stood out the most was TechBrot Inc’s attention to detail.
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§ 02 · Why it trips businesses up
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 can produce very different bills — the Authorized Shares method can return a five-figure number for a corporation with millions of authorized shares, while the Assumed Par Value Capital method, which uses issued shares and gross assets, can come out far lower. Second, the dates and obligations differ by entity type: LLCs, LPs, and GPs pay a flat $400 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 follows formation in Delaware, it applies even to entities that never operate in the state — and a holding structure can owe it for several entities at once. Records example: a Delaware Franchise Tax Payable liability account accrued monthly for each entity, the authorized and issued share counts from the corporate records, and the total gross assets on the Balance Sheet — the inputs both calculation methods use — reconciled to the amount your registered agent or CPA files.
None of this is a reason to avoid forming in Delaware — it’s a reason to reserve for the tax and keep the figures both methods use. When the franchise tax is accrued in the books and those figures are on file for your registered agent or CPA, the annual bill is funded and predictable instead of a surprise.
Two methods, very different bills
Authorized Shares vs Assumed Par Value.
The Division of Corporations says to use the method that results in the lesser tax. The Authorized Shares method can produce a five-figure bill for a company with millions of authorized shares; the Assumed Par Value Capital method has a $400 minimum and can come out far lower. The fix is keeping the share counts and gross-asset total in the books so your registered agent or CPA can compute both.
Dates & reports differ
June 1 vs March 1 — and a report.
LLCs, LPs, and GPs pay a flat $400 by June 1 with no annual report; corporations pay $175 to $200,000 ($250,000 for a Large Corporate Filer) by March 1 with an annual report. Miss the corporate report and a $200 penalty applies, with 1.5% a month interest on unpaid tax, and good standing is at risk. The fix is the right date on the calendar and the reserve ready.
Reserved, or it’s a surprise
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.
§ 03 · The scope
How we help with the Delaware franchise tax.
TechBrot handles
- Franchise-tax liability tracked and reserved in QuickBooks, accrued monthly
- Share counts and the gross-asset total that both corporate methods (Authorized Shares and Assumed Par Value Capital) use, kept ready in 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
§ 04 · The advisory line
Automation handles the data entry. We handle the judgment.
Software can post a payment once the bill arrives; it can’t notice that the share counts and gross-asset total both methods use were never recorded, or that a holding structure has five separate franchise-tax bills to reserve for. That judgment — keeping each entity’s figures complete and its reserve funded — is what keeps the franchise tax from becoming an annual surprise. Which method to file under is your registered agent’s or CPA’s call.
Once the franchise tax is accrued every month and the figures for both methods are on file, 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
Checked against the Delaware Division of Corporations.
§ 05 · Who works on your books
Your TechBrot team.
Every engagement runs on three roles: a client advisor who scopes it and stays your point of contact, a senior bookkeeper who prepares your setup and monthly close in your software, and a Certified QuickBooks ProAdvisor who reviews every close before it reaches you. A U.S.-based bookkeeper is available on request; we can share their public directory profile with you.
Specialists when your books need them.
Senior bookkeepers who specialize in rental portfolios and Xero, and specialist partner practices for trust accounting for law firms and CFO advisory. We bring the right one onto your engagement when your business calls for it, under the same standards and review.
§ 06 · Around the engagement
Around the engagement.
Holding companies & incorporation
Per-entity books, intercompany structure, and a franchise-tax reserve for the holding companies and registered entities Delaware is known for.
The engagement§ 07 · Around this page
Around Delaware.
Delaware QuickBooks ProAdvisor & bookkeeping
The state page: services, industries, cities and the Delaware tax terms in one place.Also in Delaware
Delaware cities
Not sure where your file stands? Start with the free QuickBooks file review · how Delaware compares: state-by-state tax quirks · just formed? after you incorporate in Delaware.
§ 08 · Questions
Delaware franchise tax questions.
What is the Delaware franchise tax?
It’s an annual tax owed because an entity was formed in Delaware — not a tax on income or sales. LLCs, LPs, and GPs pay a flat $400 due June 1 (no annual report); corporations pay $175 to $200,000 due March 1 (up to $250,000 for a Large Corporate Filer) with an annual report, and exempt domestic corporations file the report but pay no tax. Paying it and filing on time keeps the entity in good standing whether or not it operates in the state.
How much is the franchise tax for an LLC versus a corporation?
An LLC, LP, or GP pays a flat $400 a year, due June 1, with no annual report. A corporation pays a $175 minimum under the Authorized Shares method or a $400 minimum under the Assumed Par Value Capital method, up to a $200,000 maximum ($250,000 for a Large Corporate Filer), due March 1 with an annual report. The Division of Corporations says to use the method that results in the lesser tax.
Does TechBrot file my franchise tax or annual report?
No. TechBrot is not a registered agent and does not file the franchise tax or the annual report — your registered agent or CPA computes and files them. We track and reserve the liability in QuickBooks so it’s funded when due, and keep the share counts, gross-asset total, and entity details ready for whoever files.
How much does Delaware franchise tax help cost?
It’s one fixed fee a year, scoped in writing — annual support to track and reserve the franchise tax in your books and keep the figures both corporate methods use — priced after a free discovery call. Multi-entity and holding-company structures are scoped per entity. Book a call or dial (877) 751-5575 and a client advisor will scope it with you.
Why did my corporation get a huge franchise-tax bill?
Check which method the figure was computed under. The Authorized Shares method adds $85 for each additional 10,000 authorized shares, or portion, above 10,000 — a corporation with 10,000,000 authorized shares computes $85,165. The Assumed Par Value Capital method uses issued shares and total gross assets, with a $400 minimum, and can produce a far lower number; the Division of Corporations says to use the method that results in the lesser tax. We keep the share counts and gross-asset total in the books so your registered agent or CPA can compute both.
What happens if I pay the Delaware franchise tax late?
A corporation that does not file a completed annual report by March 1 owes a $200 penalty, and interest at 1.5% per month applies to any unpaid tax; an LLC, LP, or GP that misses June 1 owes a $200 penalty plus 1.5% interest per month on tax and penalty. Good standing is at risk, and a corporation’s charter becomes void after a year unpaid or unfiled. If you’re behind, get the books reconciled and the reserve confirmed before it compounds — book a call or dial (877) 751-5575 to get the numbers straight.
Do I owe the franchise tax if my Delaware company operates from another state?
Yes. The franchise tax follows formation in Delaware, regardless of where you operate — the Division of Corporations applies it to all corporations incorporated in Delaware and the $400 annual tax to LLCs, LPs, and GPs formed there. We track and reserve each entity’s franchise tax in the books and coordinate the figures with your home-state CPA and registered agent.
§ 09 · Talk to a client advisor
One call tells you exactly where your books stand.
Tell us where you sell and where you file. We’ll tell you what records the returns need; your tax preparer files them.
What happens when you callDelaware businesses start here
Get your Delaware franchise tax tracked and reserved.
Tell us where the books stand, and we’ll check whether your franchise tax is reserved in the books and whether the figures both corporate methods use are on file. Not a registered agent; does not file the franchise tax or annual report; coordinates with your CPA and agent.
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