Flat-Fee Tax Preparation for Delaware Residents

Delaware has a graduated income tax with rates from 0% to 6.6% — moderate by Northeast standards

Delaware has no state sales tax — one of only five states without a general sales tax, making it attractive for consumers and certain businesses

DE is the most popular state for LLC and corporation formation nationally due to its Court of Chancery, flexible corporate law, and no sales tax on goods purchased for use outside DE

Delaware's gross receipts tax applies to most businesses operating in DE regardless of profitability — rates vary by industry from 0.0945% to 0.7468%

DE does not tax out-of-state income for non-residents who form Delaware entities but operate elsewhere — the entity itself has no DE income tax liability if it does no business in DE

Delaware imposes a franchise tax on corporations formed in DE — for LLCs the annual tax is a flat $300, for corporations it's calculated based on authorized shares or assumed par value capital

Real estate transfer tax in DE is 4% (2% state, 2% local) — among the higher transfer tax rates in the Mid-Atlantic region

Delaware does not impose a state estate or inheritance tax

Delaware Real Estate Tax

Delaware's real estate market is concentrated in Wilmington and Sussex County beach communities. The 4% total transfer tax (split between state and local) is a significant transactional cost for DE real estate buyers. With no sales tax, DE is attractive for retail businesses. DE real estate gains are taxed at ordinary DE income tax rates up to 6.6%.

Delaware Business Tax

Delaware is the preferred jurisdiction for entity formation for thousands of companies nationwide due to its favorable corporate law — but DE-formed entities that operate entirely outside DE typically owe no DE income tax. DE residents and businesses operating in DE face the gross receipts tax, which applies regardless of profitability. The flat $300 LLC annual tax is a minimal cost for DE-formed LLCs doing business elsewhere.

Do I need to file a Delaware state tax return?

If you are a DE resident or earned DE-source income, you must file a DE return. Delaware's rates top out at 6.6%. Non-residents who work in DE owe DE income tax on DE-source wages. Many people form DE LLCs but live and work elsewhere — in that case, the LLC owes no DE income tax (just the annual $300 fee), and the owner files taxes in their home state.

What makes Delaware taxes unique?

Delaware has no sales tax and no estate tax, making it attractive for both consumers and estate planning. The state is best known nationally as the preferred jurisdiction for forming LLCs and corporations due to its flexible corporate law and specialized Court of Chancery — but formation in DE alone does not create DE income tax liability if the business operates elsewhere.

What is Delaware's gross receipts tax?

Delaware imposes a gross receipts tax on the seller of goods and services in DE, based on total receipts rather than net income. Rates vary by industry. Unlike income tax, the gross receipts tax is owed even if the business is unprofitable. Businesses operating in Delaware should factor this into their compliance obligations and cost structure.

How much is the Delaware franchise tax for my LLC?

Delaware LLCs pay a flat $300 annual franchise tax (technically called the "LLC annual tax") due June 1 of each year. Delaware corporations face a more complex calculation based on either the authorized shares method or the assumed par value capital method — for many startups and small corporations, the tax ranges from $175 to several thousand dollars. Failure to pay results in loss of good standing.