A Summary Of The New Amendments Relating To Delaware Franchise And Annual Taxes

This is our final post in a IV post series.

Finishing up our series, you may find below highlights of Delaware’s new corporate legislation pertaining to to Franchise And Annual Taxes. As usual, the summary is located just after the official Delaware Division of Corporations disclaimer notice:

NOTE: THE FOLLOWING SUMMARY OF 2008 LEGISLATION AFFECTING DELAWARE BUSINESS ENTITY LAWS IS NEITHER AUTHORITATIVE NOR ALL-INCLUSIVE. THIS SUMMARY DOES NOT REPRESENT OFFICIAL POLICY OF THE STATE OF DELAWARE AND HAS BEEN PREPARED ONLY FOR GENERAL INFORMATION PURPOSES AND NOT FOR LEGAL ADVICE.

AMENDMENTS RELATING TO FRANCHISE AND ANNUAL TAXES

The Corporate Franchise Tax has been amended to increase the minimum franchise tax rate for corporations using the Authorized Shares Method. The franchise tax for corporations with 5,000 or fewer shares is now $75. The franchise tax for corporations with 5,001 shares to 10,000 shares is now $150. Corporations with more than 10,000 shares will be assessed $75 for each 10,000 shares or part thereof above the initial 10,000. There are no changes to the maximum franchise tax ($165,000) or the method used to calculate the alternative tax using the Assumed Par Value Capital Method. Annual taxes for general partnerships, limited partnerships, and limited liability companies registered with the Secretary of State have increased from $200 to $250.

The tax amendments are effective on January 1, 2008.

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