Last reviewed October 7, 2026 · By the NYBACS advisory team
Short answer
A Delaware corporation must file an annual franchise tax report and pay franchise tax to the Delaware Division of Corporations by March 1 each year, keep a Delaware registered agent, and file a federal Form 1120 with the IRS. Corporations owing $5,000 or more make quarterly estimated franchise tax payments. If the company operates outside Delaware, it also has annual reports and tax returns in each state where it is registered or taxable.
Key takeaways
- The Delaware annual report and franchise tax are due together on or before March 1 for the previous calendar year.
- The annual report filing fee is $50 for a non-exempt domestic corporation, on top of franchise tax that starts at $175 or $400 depending on the calculation method.
- A late report or payment adds a $200 penalty plus interest of 1.5% per month on the tax and penalty.
- Under Delaware law a corporation's charter becomes void if it fails for one year to pay franchise tax or file a complete annual report.
- Federal Form 1120 is due April 15 for calendar-year corporations, with Form 5472 attached if a foreign person owns 25% or more.
A Delaware C-Corp's compliance year, month by month
For a calendar-year Delaware corporation, the recurring filings fall into a predictable pattern:
| When | Filing | Filed with |
|---|---|---|
| By January 31 | Forms 1099-NEC to contractors; W-2s if there is payroll | Recipients and IRS / SSA |
| By March 1 | Annual franchise tax report and franchise tax | Delaware Division of Corporations |
| By April 15 | Form 1120 (or Form 7004 extension), with Form 5472 if 25% foreign-owned | IRS |
| June 1, September 1, December 1 | Estimated franchise tax installments (40%, 20%, 20%) if the tax is $5,000 or more | Delaware Division of Corporations |
| Varies by state | Annual reports and income or franchise tax returns where the company is foreign-qualified | Other states |
| Ongoing | Registered agent renewal | Registered agent |
The Delaware filings are corporate-law obligations: they keep the company in existence. The IRS filings are federal tax obligations. Missing either causes problems, but in different places.
What goes into the Delaware annual report
The annual franchise tax report is filed online through the Division of Corporations using the company's file number. It asks for:
- The principal place of business address, which can be outside Delaware or outside the US.
- The names and addresses of all directors.
- The name, title and address of at least one officer, along with the person filing the report.
- The number of authorized shares, by class and par value, which Delaware already has on record.
- The number of issued shares and total gross assets, if the company wants its tax computed under the Assumed Par Value Capital method.
The report is a statement of current facts, so directors and officers who left during the year should not be listed. Directors' names become part of the state's records, which founders who value privacy should note.
How much a Delaware corporation pays each year
The cost has three parts: the $50 report fee, the franchise tax, and the registered agent's annual charge. Franchise tax is the variable piece. Delaware calculates it by default using the Authorized Shares method, which produces the $175 minimum only for companies with 5,000 or fewer authorized shares. Startups with millions of authorized shares often see a much larger figure on the state's notice and need to recalculate using the Assumed Par Value Capital method, which has a $400 minimum.
The maximum is $200,000, or $250,000 for corporations Delaware classifies as Large Corporate Filers. Exempt corporations, such as most nonprofits, file the report with a $25 fee and pay no franchise tax.
Filings outside Delaware that are easy to miss
Most foreign-owned Delaware corporations do no business in Delaware itself. Their actual operations sit in New York, California, Texas or abroad, and that is where the remaining filings come from:
- Foreign qualification states have their own annual or biennial reports and minimum taxes.
- State income or franchise tax returns are due where the company has nexus, which can arise from employees, an office or, in some states, sales alone.
- Payroll and sales tax filings run on monthly or quarterly schedules in the states where those registrations exist.
- BOI reporting no longer applies to US-formed corporations under FinCEN's current rules, but a foreign company registered in a US state is still in scope.
Delaware corporate income tax applies only to corporations that actually do business in Delaware, which is why most holding-style Delaware corporations owe franchise tax there but no income tax.
If the March 1 deadline has already passed
File the report and pay as soon as possible. Penalty and interest grow each month, and the company will not receive a certificate of good standing until the account is current, which can hold up a bank account review, a fundraising close or a foreign qualification. If a full year passes, the charter becomes void and the company has to file a certificate of revival and pay all back taxes, penalties and interest before it can operate normally again.
Common mistakes to avoid
- Paying the large Authorized Shares figure on Delaware's notice without recalculating under the Assumed Par Value Capital method.
- Filing the Delaware annual report and assuming the company's IRS obligations are handled too.
- Listing departed directors or leaving out the officer details the report requires.
- Missing the June, September and December estimated installments once the tax reaches $5,000.
- Responding to look-alike private solicitations for corporate records services instead of filing through the official Delaware portal.
- Forgetting annual reports in the states where the corporation is foreign-qualified.
Documents and records to prepare
- Delaware file number and registered agent details
- Current list of directors and officers with addresses
- Principal place of business address
- Capitalization table showing authorized and issued shares by class
- Year-end balance sheet showing total gross assets (Form 1120 Schedule L figure)
- Prior-year annual report confirmation
NYBACS 360° support
How NYBACS helps
- Prepares and files the Delaware annual franchise tax report, including the Assumed Par Value Capital calculation where it lowers the tax.
- Maintains a combined calendar of Delaware, IRS and operating-state deadlines for your corporation.
- Keeps the director and officer list in the report consistent with board minutes and the cap table.
- Coordinates Form 1120 and Form 5472 preparation with qualified tax professionals.
- Brings lapsed corporations back into good standing, including revival where the charter has become void.
Frequently Asked Questions
Does a Delaware corporation with no revenue still owe franchise tax?
Yes. Franchise tax is charged for the privilege of being a Delaware corporation, not on income. A dormant corporation still files the annual report and pays at least the minimum.
Is the Delaware annual report due on the company's anniversary?
No. Every Delaware corporation files by March 1, covering the previous calendar year, regardless of when it was incorporated.
Can I file the Delaware annual report myself?
Yes. The Division of Corporations' online system accepts filings directly from the company. Many companies use a provider so the tax method, officer details and payment are handled consistently each year.
Do I still owe franchise tax for the year I dissolve the company?
Generally yes. Delaware requires taxes and annual reports to be brought current before it will accept a certificate of dissolution, so the final year's tax is part of the cost of closing.
What is a Large Corporate Filer?
It is a Delaware classification for corporations listed on a national stock exchange that meet revenue or asset tests. They pay a flat franchise tax set at the higher maximum rather than using the share-based calculations.
