Delaware Franchise Taxes

By Incorporation

If you haven’t already received your Delaware franchise tax statement in the mail, then it’s probably on the way.

You have to give credit to Delaware — they make paying your corporation’s franchise taxes “thrilling.”

For example, if you authorized 10,000,000 shares of common stock in your certificate of incorporation, you will receive a franchise tax bill stating “$75,075” as the amount owed. This total is computed based on your startup’s number of authorized shares.

But it’s a good thing for your startup that Delaware offers an alternative way to compute your franchise tax bill: the “Assumed Par Value Capital Method.”

This was the topic of a post I wrote 2 years ago titled “The Delaware Freak-Out.” If you have a startup that is incorporated in Delaware, it’s probably a good time to revisit that post.


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