A Delaware LLC does not file an annual report. The only recurring obligation to the state is a flat $300 annual tax, due on or before June 1, plus the ongoing requirement to keep a registered agent with a Delaware street address.1Delaware Division of Corporations. LLC/LP/GP Franchise Tax Instructions That is the whole picture at the Division of Corporations level. No report, no financials, no schedule of members.
What You Owe and When
Every domestic and foreign LLC on Delaware’s rolls owes the $300 tax, regardless of whether the company earned revenue, opened a bank account, or did anything at all during the year.2Delaware Division of Corporations. Annual Report and Tax Information It is a flat fee for the privilege of existing as a Delaware LLC, not an income tax.
The payment is due by June 1 each year and covers the prior calendar year. Delaware does not prorate. Form your LLC on December 28 and you still owe the full $300 for that calendar year, with another $300 coming due the following June 1.1Delaware Division of Corporations. LLC/LP/GP Franchise Tax Instructions People who form late in the year often expect a reduced first bill. There isn’t one.
The state does not mail invoices or send reminders. Tracking the deadline is on you.
How to Pay
Payment goes through the Division of Corporations online portal. You will need your LLC’s file number, which can be up to nine digits.3Delaware Division of Corporations. Delaware Corporations Information System – eCorp Login The portal accepts Visa, Mastercard, American Express, Discover, and ACH debit from a checking account.1Delaware Division of Corporations. LLC/LP/GP Franchise Tax Instructions
Save the confirmation. It is your proof of compliance until the next time you need a formal certificate from the state.
Keeping a Registered Agent
Separate from the tax, Delaware requires every LLC to continuously maintain a registered agent with a physical street address in the state. The agent receives legal documents and official correspondence on the LLC’s behalf.4Division of Corporations – State of Delaware. FAQs Regarding Registered Agents The agent can be the LLC itself if it keeps a Delaware office, an individual Delaware resident, or another business entity authorized to operate in the state.5Delaware Division of Corporations. Delaware Division of Corporations Registered Agent Listing Standards
Most out-of-state owners hire a professional service, with typical rates running between $50 and $300 per year, paid to the provider rather than the state. To switch providers, file a Certificate of Amendment with the Division of Corporations for $50.6Delaware Division of Corporations. Certificate of Amendment – Change of Agent for LLC Letting the agent lapse puts your LLC out of good standing and means a lawsuit could be served without you ever learning about it.
What Happens If You Miss June 1
A missed deadline triggers an immediate $200 penalty on top of the $300 tax, and interest accrues on the combined balance at 1.5% per month.1Delaware Division of Corporations. LLC/LP/GP Franchise Tax Instructions A single year of non-payment turns a $300 bill into roughly $590 before interest, and each additional missed year adds its own $300 tax plus another $200 penalty.
The bigger risk is structural. If the annual tax goes unpaid for three years from its due date, Delaware automatically cancels the LLC’s Certificate of Formation.7Justia Law. Delaware Code Title 6 Chapter 18 – Section 18-1108 A cancelled LLC cannot legally conduct business in Delaware, cannot sue to enforce its contracts, and loses the liability shield that was the reason to form it.
Bringing a Cancelled LLC Back
A cancelled LLC can be restored by filing a Certificate of Revival with the Division of Corporations. The filing fee is $220, and you must also pay every dollar of back taxes, accumulated penalties, and interest owed at the time of cancellation before the state will process the revival.8Delaware Division of Corporations. Certificate of Revival for Limited Liability Company
Once filed, the revival validates contracts, actions, and transactions that occurred during the cancellation period as if the cancellation never happened.7Justia Law. Delaware Code Title 6 Chapter 18 – Section 18-1108 That retroactive effect is useful, but it is not a safety net to lean on. While cancelled, you had no standing to sue, and a counterparty in a dispute could have used that gap against you.
Stopping the Tax for Good
The $300 keeps accruing every year the LLC appears in Delaware’s records, dormant or not. The only way to stop it is to formally dissolve by filing a Certificate of Cancellation, which costs $220.9Delaware Division of Corporations. Certificate of Cancellation of a Limited Liability Company All taxes owed through the effective date must be paid before the state will accept the filing. Confirm the exact figure with the Division’s Franchise Tax Section before submitting.
Walking away and ignoring the bills is not dissolution. It is three years of accumulating penalties, followed by an administrative cancellation on the state’s terms, with the unpaid balance still on record if you ever want to revive.
Other Things the $300 Does Not Cover
A few neighboring obligations get mistaken for part of the annual tax. They aren’t.
If a bank, investor, or another state asks for proof that your LLC is current, you order a Certificate of Good Standing (also called a Certificate of Status) from the Division of Corporations. The short-form costs $50; the long-form, with full filing history, costs $175.10Delaware Division of Corporations. Accessing Corporate Information Most states requesting one as part of a foreign qualification want it issued within the last 30 to 90 days, so don’t order too early.
If your Delaware LLC actually operates in another state, Delaware’s $300 is only one layer. Most states require an out-of-state LLC doing business in them to register as a foreign LLC by filing for a certificate of authority, appointing a local registered agent, producing a Delaware Certificate of Good Standing, and paying a filing fee that typically runs $100 to $300. States commonly bar unregistered companies from using their courts and will assess back fees once they discover the activity.
And if your LLC conducts business inside Delaware, the Division of Revenue has its own requirements: an annually renewed Delaware business license,11Business First Steps. General Business License and a gross receipts tax running roughly 0.1% to 2.0% of gross receipts depending on business activity, with monthly exclusions that start at $100,000 for most categories.12Division of Revenue – State of Delaware. Gross Receipts Tax FAQs For a Delaware LLC that is purely a holding entity with no operations in the state, those rules generally do not apply, and the $300 annual tax plus the registered agent fee is the full annual cost.