LLC Annual Report and Tax Filing Requirements in Delaware

Once you register your Delaware limited liability company (LLC), you have to take continuing steps to operate your company legally. One of the key tasks is paying and reporting business taxes to the state.

No Delaware LLC Annual Report

Unlike most states, Delaware doesn't require LLCs to file annual reports. However, the state does require LLCs to pay an annual tax (see below).

State Business Taxes in Delaware

By default, Delaware treats LLCs as pass-through tax entities. The LLC itself doesn't pay income tax. Instead, the owners of the LLC pay and report income tax on their portion of the LLC's income.

Must pay an annual tax. Delaware imposes an annual tax of $300 on LLCs. The tax is due to the Department of State (DOS) by June 1 every year. As of 2023, the DOS charges a penalty of $200 plus interest for late payments or nonpayments. You can pay the tax online at the DOS website.

Electing corporate tax status. You might elect to be taxed as a corporation rather than as a partnership (or sole proprietorship for single-member LLCs). Delaware, like almost every other state, taxes corporate income. As of 2023, the state corporate income tax rate is a flat 8.7% of federal taxable income. The tax is payable to the Division of Revenue (DOR). Use the state's corporate income tax return (Form 1100) to file and pay this tax.

For more details, read our article on Delaware state business income tax.

Delaware Employer Taxes

If your company has employees, you'll probably need to pay federal and state employer taxes. Delaware requires most employers to withhold employee income and pay unemployment insurance (UI) tax.

Withholding employee wages. Begin by opening a State of Delaware withholding account using the state's One Stop business licensing and registration system. Once you've registered, you'll need to file withholding taxes on a periodic basis—for example, monthly, eighth-monthly, or quarterly. You must also file an annual reconciliation of your LLC's tax withholding. You can find these forms on the business tax forms section of the DOR website. You can also check the Employer's Guide on the DOR website for information about withholding regulations and the employer's duties.

UI tax. To pay UI tax, register your business with the Delaware Department of Labor (DOL) through the Online Employer Services portal. Each quarter, use Form UC-8 to report on wages and pay the UI taxes. Review the Unemployment Insurance Employer Handbook for more detailed instructions.

Delaware Gross Receipts Tax

Delaware is one of just a few states that doesn't have a sales tax. However, Delaware does have a gross receipts tax, which is a tax on sellers of goods or providers of services. The tax is based on a seller's gross revenues.

As of 2023, rates for the gross receipts tax currently range from .0945% to 1.9914% depending on the type of business involved. You must pay this tax either monthly or quarterly.

You can find answers to frequently asked questions and pay your gross receipts tax coupons online at the DOR website.

You might be responsible for reporting and paying sales and use tax or another related tax to your city or county. Make sure you check with your local taxing authorities for your reporting responsibilities.

LLC Registration in Other States

If you do business outside of Delaware, you might need to register your out-of-state LLC in some or all of the states where you conduct your business activities. Check those states' laws to determine when and how you should register your LLC. Registration usually involves obtaining a certificate of authority or a similar document.

Check out our section on running your LLC for more information on how to manage and operate your company. If you have questions about your specific state tax responsibilities, talk to a business or tax attorney in Delaware.