AAFCPAs would like to make clients aware that all companies incorporated in the state of Delaware are required to file an annual report and pay an annual franchise tax to Delaware each year by March 1st.
We have outlined for your convenience two methods of calculating the franchise tax you owe:
the authorized shares method, which is based on the number of authorized shares your company has; or
the assumed par value method, which is based on the value of your company’s assets.
You are only required to pay the lesser of the two, so these calculations are crucial to limiting your tax liability. The maximum annual tax is $250K for “large corporate filers” who have consolidated gross revenue or consolidated assets between $250M and $750M and $200K for the rest.
If you have any questions or need help with these often complex calculations, please contact Kelly Zack, MST at kzack@nullaafcpa.com, 774.512.4001; or your AAFCPAs Partner.
Kelly is a senior leader in AAFCPAs’ Commercial Tax practice. She advises individuals, partnerships, corporations, nonprofits, and trusts operating in multiple states and municipalities on opportunities to save tax dollars through advanced tax planning and risk mitigation. This includes the identification of all location-specific tax incentives and credits that could impact business entities and their owners.
Kelly brings expertise in nexus analysis for income/franchise tax and sales and use taxes along with the analysis of state …
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