State Processing Fees and Times
Wondering what the processing times and fees are for starting a Delaware corporation? We have a list of both average and expedited wait times for filing.
Delaware charges a corporation filing fee. Visit "compare pricing" in our incorporation center to see all state fees for Delaware.
Deciding Between a Delaware S Corp and C Corp Tax Designation
- Ownership Rules: Both S Corps and C Corps are owned by stockholders. The businesses are managed by a board of directors.There are no limits to the number of shareholders a C Corp can have, but S Corps are usually limited to 100 shareholders.
- Taxes: C Corps pay taxes on business income at the corporate rate. Profits distributed to shareholders are taxed at the shareholder's personal income tax rate. S Corps are not taxed at the corporate level. Corporate income is taxable to their shareholders at their personal income tax rate.
- Documents: An S Corp must file IRS Form 2553 to elect S Corp status.
Every state has its own personnel requirements for incorporating. In Delaware, they include the following:
- Age requirement: Delaware has no age requirement for incorporators.
- Number of directors: One or more people can organize a corporation in Delaware.
- Residency: There is no requirement that incorporators must live in the state.
Other Requirements for Your Certificate of Incorporation
In addition to personnel requirements, your Delaware Certificate of Incorporation must also include the following.
Every corporation should appoint a registered agent. A registered agent is the person or business responsible for receiving tax, legal and government documents for your corporation during regular business hours. Every corporation needs one. Your agent must be included in your Certificate of Incorporation in Delaware. We can help you designate your registered agent when you incorporate with us.
You must also include the following in your Certificate of Incorporation in Delaware:
- The name and registered address of the corporation, as well as its registered agent.
- The nature of the business to be promoted.
- The number of shares of stock.
- The name and mailing address of the incorporator or incorporators.
- The names and mailing addresses of all persons who will serve as directors until the first shareholders' meeting, if the incorporators' powers terminate with the filing of the Certificate of Incorporation.
Guidelines for Your Name
Your corporation's name is how it will be known to the world. Delaware has a few requirements:
- All Delaware corporation names must include "Association," "Company," "Corporation," "Club," "Foundation," "Fund," "Incorporated," "Institute," "Society," "Union," "Syndicate" or "Limited."
- Your corporate name must distinguish your corporation from all other business entities on file with the Delaware Division of Corporations.
- Delaware does not allow corporate names to include the words "bank" or "trust," unless the corporation is a bank reporting to the Delaware State Bank Commissioner.
Delaware Corporate Taxes and Reports
All Delaware corporations are required to file annual reports and pay a franchise tax. Taxes and annual reports must be filed by March 1 each year.
It may not be the most enjoyable part of owning a business, but you'll have to prepare tax returns and pay taxes for your new corporation. Before you can start doing business, you must apply to the IRS for an EIN, or employer identification number. An EIN is like your business's Social Security number. We have more information about the tax structures and obligations of both C Corps and S Corps.
Corporate Record Keeping and Filing Requirements
Delaware requires that corporations keep corporate records, such as bylaws, to maintain their corporate status. Although it's not required in Delaware, keeping meeting minutes is still a good idea. They help protect the legality of your corporate status. We have more detailed information about Delaware's requirements for bylaws and meeting minutes.
Starting a new corporation can be exciting and challenging. We have all the legal documents, filing and tax information you'll need to get started.
This article contains general legal information and does not contain legal advice. Rocket Lawyer is not a law firm or a substitute for an attorney or law firm. The law is complex and changes often. For legal advice, please ask a lawyer.