LLC Cost in Delaware – How Much to Pay for an LLC


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Perhaps you are hoping to form a Delaware LLC. People assume how to start an LLC is difficult and costly. However, it’s generally not difficult, and the cost would vary across states. We have all the info you need to know about the cost of forming an LLC, particularly the LLC cost in Delaware.

Delaware LLC Cost of Filing

Here are the costs involved in forming an LLC in Delaware.

Cost of Filing Formation Certificates

The Delaware Certificate of Formation is responsible for the majority of the cost, which could also vary depending on whether you’re forming a domestic LLC or a foreign LLC. Still, you can file both at the Delaware Secretary of State

Delaware Domestic LLC

  • By Mail: Fill out the application form, and send it to Delaware Division of Corporations 401 Federal Street Suite 4 Dover, DE 19901 Costs $90
  • Franchise Tax $300 (Annual) can be done online.

Delaware Foreign LLC

  • By Mail: Fill out the application form, and send it to Delaware Division of Corporations 401 Federal Street Suite 4 Dover, DE 19901 Costs $200
  • An additional certified copy costs $50
  • Franchise Tax $300 (Annual) can be done online.

Note that filing online is ideal, not only because you need to go to the Secretary of State office, but also it would be faster. You won’t have to wait in a queue in doing so.

Delaware LLC Formation Service or Registered Agent Fee

You need a registered agent to form an LLC in Delaware, hence, added costs for service fees. Here are three of the best LLC services on our list that will provide you with registered agents to ease your worries.

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Business Permits and Licenses 

The business licenses depend on your business’s activity and location and are renewed yearly. As such, the cost will vary. Check the Delaware Department of Revenue for regulatory boards or agencies requiring licensing. 

Delaware Business Privilege Tax and Annual Report

Once you have your EIN or Employer Identification Number, apart from filing sales tax, once the company has completed its 2.5 months as an LLC in Delaware, it needs to pay a Business Privilege Tax (BPT). This is a requirement for all LLCs formed in Delaware. 

LLCs need to pay the tax before the third week of April, i.e, 15 April, and it can vary from 0.00025% to 0.000175% according to the net worth of the LLC. The exact rate will be obtained on the basis of the income of the previous taxable year. The minimum amount that the business will have to pay for this tax is $100. 

Delaware Taxes to Be Paid By The LLCs

Delaware is said to be the tax shelter state of the United States. The reason behind this is it has flexible taxation for the Limited Liability Companies. Firstly, the state does not have any Sales Tax. No, tax is imposed on the businesses based on Sales within the Delaware boundary. The state has Franchise tax and corporate income tax for the businesses. 

Delaware Franchise Tax

Franchise Tax in Delaware is paid annually on 1st June every year. Failing to pay on time, the LLCs can be fined $200 plus 1.5% interest upon the penalty. The amount of Franchise Tax is $300 and has to be paid by all LLCs irrespective of the size. 

Franchise Tax does not mean one has to have a Franchise business. It is a general business tax every LLC and corporation in Delaware has to pay annually. 

Corporate Income Tax

LLCs have the advantage of passing through income taxes. Hence, in Delaware, no LLCs have to pay corporate income taxes. However, the members have to pay income taxes separately according to their profit.

On the other hand, S Corporations do not have to pay any federal taxes. They have more tax benefits than LLCs. If an LLC wants, it can be filed as S Corporation by filing an IRS. In that case, the LLCs have to pay corporate income tax. 

Cost Comparison Among States

Delaware is surrounded by states like Pennsylvania, Maryland, New Jersey, and Virginia. Here’s LLC cost comparison among the neighboring states of Delaware,

StateFiling FeeAnnual Fee/Biennial Fee
Delaware LLC$90$300 (Annual)
Pennsylvania LLC$125$70 (Every 10 years)
New Jersey LLC$125$75 (Annual)
Maryland LLC$100$300 (Annual)
Virginia LLC$100$50 (Annual)

Other Costs

How Much Does It Cost to Maintain an LLC in Delaware

To maintain an LLC in Delaware you will need to pay an annual fee of $300 along with sales tax, business privilege tax, franchise tax, corporate income tax and federal taxes.

How much does it cost to form and maintain an LLC in Delaware? When forming a new business, it’s best to understand all of the expenses involved in operating it, so you can better plan your budget. There are several different expenses you’ll need to account for, from filing fees to insurance. The following sections will outline the fees and expenses involved in maintaining an LLC in Delaware. We’ve included a brief overview of each expense to give you an idea of what to expect.

Names. Your Delaware LLC must not have the same name as another business entity. To find the availability of a suitable name, you need to search the Division of Corporations database maintained by the Delaware Secretary of State. During your search, you’ll discover whether your chosen name is available or not. In addition to determining whether your name is available, you’ll also need to obtain a business license in Delaware, depending on your location and activity. Once your business is up and running, you’ll need to renew this license every year.

While the fee for the Certificate of Formation is only paid once, you’ll need to pay a $50 fee to the Division of Corporations to receive certified copies of your documents. Additionally, you’ll need to pay an annual fee to the Division of Revenue to avoid the LLC from being dissolved. These fees depend on the type of entity and industry, but they range anywhere from $75 to $100,000. This low amount of expenses makes it a great choice for businesses that don’t plan to hire employees.

Keeping an LLC in Delaware is easy. You simply need to pay a $300 tax to maintain it. While this may seem expensive, it is a relatively small cost for most businesses. Besides the registration fees, you’ll also need to pay state and federal income taxes, as well as self-employment taxes. The Delaware Department of Revenue will charge you a fee based on your income level.

Another important fee you should consider when creating a Delaware company is the franchise tax. This is due annually on June 1 and can add up to $300 to your bill. If you fail to pay the fee on time, a $200 late fee and 1.5% per month interest will be assessed. If you fail to pay the tax on time, the fee will automatically be increased by $200 and you will have to file a tax return.

Once your business is set up in Delaware, you’ll need to choose a name for it. Before you choose a name, check the availability of your chosen name using the Delaware business database. Additionally, you’ll need to choose a registered agent. Although you can serve as the registered agent yourself, you’re better off hiring a registered agent service. There are many advantages to hiring a registered agent in Delaware.

F.A.Qs

Can I start an LLC for free?

It is possible to form an LLC without professional help, but forms still have associated costs, regardless of where your LLC is formed.

Is an LLC expensive?

It is difficult to say whether forming an LLC is expensive. Nevertheless, the cost could be anywhere from $40 to $500. If you refuse to hire professionals, you’ll still have expenses like form fees to cover.

Does an LLC need a bank account?

The need to separate personal money from business funds, thus necessitating the creation of a business bank account for your LLC.

In Conclusion

The cost of Delaware is much lower compared to other forms of business. Apart from the state filing fees and annual taxes, you might bear the cost of the registered agent. Compare the price of professional LLC services and choose the most affordable one.

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