How Delaware franchise tax is calculated
How the Delaware franchise tax amount is worked out, in plain English, with a source for each rule.
Last verified October 4, 2026Delaware · Corporation
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Who has to pay
In Delaware, “a domestic stock or non-stock for profit corporation incorporated in the State of Delaware is required to pay annual franchise tax”. 1 The smallest amount of tax is $175. 2
The two methods
Delaware describes two ways to calculate the tax and says: “Use the method that results in the lesser tax.” 3
In Delaware, the Authorized Shares Method uses only the number of authorized shares: $175 for 5,000 shares or fewer, 4 $250 for 5,001 to 10,000 shares, and $85 more for each additional 10,000 shares or part of them. 5
In Delaware, the Assumed Par Value Capital Method also uses issued shares, par values and total gross assets. Its rate is $400 for each $1,000,000 of assumed par value capital, or part of it. 6
| Method | Uses | Minimum | Maximum |
|---|---|---|---|
| Authorized Shares | Authorized shares | $175 4 | $200,000 8 |
| Assumed Par Value Capital | Shares, par value and gross assets | $400 7 | $200,000 8 |
In Delaware, the maximum applies to both methods “unless it has been identified as a Large Corporate Filer”. Source: Delaware Division of Corporations, read on October 4, 2026, opens official page
Good to know
Delaware’s own examples
Delaware gives these examples of the Authorized Shares Method: a corporation with 10,005 authorized shares pays $335 10, and a corporation with 100,000 authorized shares pays $1,015 11. Its example of the Assumed Par Value Capital Method comes to $1,600. 12
Deadline and late penalties
In Delaware, an active domestic corporation’s annual report and franchise tax for the prior year are due on or before March 1. 13 Filing late adds a penalty of $200 plus 1.5% interest per month on tax and penalty. 14 The fee for filing the annual report is $50 for a non-exempt domestic corporation. 15 In Delaware, corporations owing $5,000 or more make estimated payments with 40% due June 1st, 20% due by September 1st, 20% due by December 1st, and the remainder due March 1st. 16
What to do this year
- Find your authorized shares on your certificate of incorporation.
- Find the par value of each share class on the same certificate.
- Find the number of shares the company has issued.
- Find your total gross assets. Delaware uses the “total assets” reported on U.S. Form 1120, Schedule L. 17
- Run both methods, or let the calculator do it once it opens.
- File the annual report and pay on Delaware’s official site. In Delaware, both are due on or before March 1. 13
In Delaware, when stock or par value changed during the year, the tax is prorated for each portion of the year. 18 The calculator will not cover that case in its first version.
Sources for this guide
- Delaware Division of CorporationsOpen source
“Effective January 1, 2018, a domestic stock or non-stock for profit corporation incorporated in the State of Delaware is required to pay annual franchise tax.”
https://corp.delaware.gov/frtaxcalc/ · read on October 4, 2026 ↩
- Delaware Division of CorporationsOpen source
“The total tax will never be less than $175.00, or more than $200,000.00.”
https://corp.delaware.gov/frtaxcalc/ · read on October 4, 2026 ↩
- Delaware Division of CorporationsOpen source
“Use the method that results in the lesser tax.”
https://corp.delaware.gov/frtaxcalc/ · read on October 4, 2026 ↩
- Delaware Division of CorporationsOpen source
“5,000 shares or less (minimum tax) $175.00.”
https://corp.delaware.gov/frtaxcalc/ · read on October 4, 2026 ↩
- Delaware Division of CorporationsOpen source
“5,001 – 10,000 shares – $250.00, each additional 10,000 shares or portion thereof add $85.00 maximum annual tax is $200,000.00”
https://corp.delaware.gov/frtaxcalc/ · read on October 4, 2026 ↩
- Delaware Division of CorporationsOpen source
“The tax rate under this method is $400.00 per million or portion of a million.”
https://corp.delaware.gov/frtaxcalc/ · read on October 4, 2026 ↩
- Delaware Division of CorporationsOpen source
“The minimum tax for the Assumed Par Value Capital Method of calculation is $400.00.”
https://corp.delaware.gov/frtaxcalc/ · read on October 4, 2026 ↩
- Delaware Division of CorporationsOpen source
“All corporations using either method will have a maximum tax of $200,000.00.”
https://corp.delaware.gov/frtaxcalc/ · read on October 4, 2026 ↩
- Delaware Division of CorporationsOpen source
“For corporations having no par value stock the authorized shares method will always result in the lesser tax.”
https://corp.delaware.gov/frtaxcalc/ · read on October 4, 2026 ↩
- Delaware Division of CorporationsOpen source
“A corporation with 10,005 shares authorized pays $335.00($250.00 plus $85.00).”
https://corp.delaware.gov/frtaxcalc/ · read on October 4, 2026 ↩
- Delaware Division of CorporationsOpen source
“A corporation with 100,000 shares authorized pays $1,015.00($250.00 plus $765.00[$85.00 x 9]).”
https://corp.delaware.gov/frtaxcalc/ · read on October 4, 2026 ↩
- Delaware Division of CorporationsOpen source
“Example: 4 x $400.00 = $1,600.00”
https://corp.delaware.gov/frtaxcalc/ · read on October 4, 2026 ↩
- Delaware Division of CorporationsOpen source
“All active Domestic Corporation Annual Reports and Franchise Taxes for the prior year are due annually on or before March 1st and are required to be filed online.”
https://corp.delaware.gov/paytaxes/ · read on October 4, 2026 ↩
- Delaware Division of CorporationsOpen source
“Failure to file the report and pay the required franchise taxes will result in a penalty of $200.00 plus 1.5% interest per month on tax and penalty.”
https://corp.delaware.gov/paytaxes/ · read on October 4, 2026 ↩
- Delaware Division of CorporationsOpen source
“Non-Exempt Domestic Corporations – $50.00.”
https://corp.delaware.gov/paytaxes/ · read on October 4, 2026 ↩
- Delaware Division of CorporationsOpen source
“Corporations owing $5,000.00 or more make estimated payments with 40% due June 1st, 20% due by September 1st, 20% due by December 1st, and the remainder due March 1st.”
https://corp.delaware.gov/frtaxcalc/ · read on October 4, 2026 ↩
- Delaware Division of CorporationsOpen source
“Total Gross Assets shall be those “total assets” reported on the U.S. Form 1120, Schedule L (Federal Return) relative to the company’s fiscal year ending the calendar year of the report.”
https://corp.delaware.gov/frtaxcalc/ · read on October 4, 2026 ↩
- Delaware Division of CorporationsOpen source
“NOTE: If an amendment changing your stock or par value was filed with the Division of Corporations during the year, issued shares and total gross assets within 30 days of the amendment must be given for each portion of the year during which each distinct authorized amount of capital stock or par value was in effect. The tax is then prorated for each portion of the year dividing the number of days the stock/par value was in effect by 365 days (366 leap year), then multiplying this result by the tax calculated for that portion of the year.”
https://corp.delaware.gov/frtaxcalc/ · read on October 4, 2026 ↩
Information, not legal or tax advice.