How to Incorporate in Delaware

Why Startups Choose Delaware

Delaware is a popular incorporation state for startups and companies that plan to raise venture capital, largely because of its well-developed body of corporate case law and its Court of Chancery, a court that hears only business disputes. Incorporating in Delaware doesn't require you to live there or operate your business there; many Delaware corporations are run entirely from another state and simply register as a foreign corporation wherever they actually do business.

Choosing a Name and Reserving It

Your corporation's name has to include a corporate designator, such as "Corporation," "Incorporated," "Company," or an abbreviation like "Corp." or "Inc.," and be distinguishable from names already on file with the Division of Corporations. You can check name availability through the Division's entity search, and you can reserve a name for $75 for 120 days if you're not ready to file immediately.

Appointing a Delaware Registered Agent

Under 8 Del. C. § 132, every Delaware corporation must maintain a registered agent with a physical business office in the state, identical to its registered office under § 131. The agent can be the corporation itself, an individual Delaware resident, or a qualified domestic or foreign entity with a Delaware office. Your Certificate of Incorporation has to name this agent and office before the state will accept your filing.

Filing Your Certificate of Incorporation

File your Certificate of Incorporation with the Division of Corporations, either electronically through its Document Filing and Certificate Request Service or by fax or mail. Per the Division's fee schedule revised August 1, 2026, the base filing fee is $109, though it can run higher depending on how many shares the corporation authorizes. The Division doesn't publish a fixed standard processing time, since it varies with current filing volume, but expedited service is available: 24-hour for $50, same-day for $100, 2-hour for $500, and 1-hour for $1,000, each added on top of the base filing fee.

Holding Your Organizational Meeting

Once the state approves your Certificate of Incorporation, 8 Del. C. § 108 lets the incorporator or the initial directors hold an organizational meeting, or act by written consent instead, to adopt bylaws, elect the board, appoint officers, and authorize and issue stock. This is the step where your corporation's actual governance gets set up, separate from the state filing itself.

Getting an EIN and a Delaware Business License

After the state approves your corporation, apply for a free EIN from the IRS. If you'll actually conduct business in Delaware, not just incorporate there, you'll also need a Delaware Business License from the Division of Revenue, generally about $75 a year for a first location, and you'll owe Delaware's gross receipts tax on what you sell or bill, since Delaware has no sales tax.

The Annual Franchise Tax Report and Tax

Every Delaware corporation, whether or not it operates in Delaware, must file an annual franchise tax report and pay its franchise tax by March 1 each year. Per 8 Del. C. § 503, the tax is calculated under either the Authorized Shares Method, with a $175 minimum, or the Assumed Par Value Capital Method, with a $400 minimum; the corporation generally pays whichever method produces a lower tax, up to a $200,000 maximum ($250,000 for a Large Corporate Filer). The annual report itself carries a separate filing fee, $25 for an exempt domestic corporation or $50 for a non-exempt one.

Keeping Your Corporation in Good Standing

Missing the March 1 deadline adds a flat $200 penalty plus 1.5% monthly interest on the unpaid tax and penalty, and an unpaid corporation falls out of good standing until it pays. Calendar this deadline as soon as your corporation is approved, since it applies every year regardless of whether the corporation had any revenue.

Incorporating in Delaware Doesn't Replace Registering in Your Home State

If you actually run your business from another state, you'll typically need to register there too, as a foreign corporation, and pay that state's own fees on top of Delaware's. Weigh this dual-state cost against the benefits of Delaware incorporation for your specific situation.

Franchise Tax Applies Even if You Don't Operate in Delaware

The annual franchise tax isn't tied to doing business in Delaware; every Delaware corporation owes it regardless of where it actually operates. Delaware's separate 8.7% corporate income tax, by contrast, generally applies only to corporations doing business in Delaware, so a corporation that's only incorporated there, not operating there, typically owes the franchise tax but not Delaware income tax.

Which Franchise Tax Method Is Cheaper Depends on Your Share Structure

The Authorized Shares Method and Assumed Par Value Capital Method can produce very different results, especially for a startup with a large number of authorized shares at a low par value. Review both calculation methods, available on the Division of Corporations' site, each year rather than assuming last year's bill will repeat.

A Registered Agent Service Can Simplify Compliance

If you don't have your own Delaware address, a registered agent service can fulfill the requirement and often sends reminders ahead of the March 1 franchise tax deadline. Confirm what the service costs after any introductory period before committing.

This Isn't Legal or Tax Advice

Fees, tax rates, and deadlines can change; confirm current figures directly on corp.delaware.gov and revenue.delaware.gov before you file or pay, and talk to a business attorney or tax professional about your specific ownership and operating plans.