Hi Everyone; today, we will briefly overview the upcoming deadlines for DE and TX franchise tax.

What is a franchise tax?

A franchise tax is a tax certain business entities must pay if they have nexus in specific states. Something important to note is that your business does not have to be a franchise for you to be required to pay a franchise tax.

DE Franchise Tax

In Delaware, the tax is mandatory if you want your business to remain in good standing with the state. You must also file an annual report at the same time as your franchise tax, and if you are a corporation, these are both due on March 1. Delaware will tax your business a late fee of $125  if the tax is not paid on time, along with a 1.5 percent monthly interest until the tax is paid. Contact your accountant or registered agent to pay this tax and file your annual report. Conversely, you can pay the tax online, but there is a calculation you must complete to do so.

Entity TypeDue DateFee
CorporationMarch 1Calculation + Annual Report Fee
Benefit CorporationMarch 1Calculation + Annual Report Fee
Foreign CorporationJune 30$125 annual report fee
Nonprofit CorporationMarch 1$25 annual report fee
LLCJune 1$300
Foreign LLCJune 1$300 annual report fee
General or Limited PartnershipJune 1$300
Limited Liability PartnershipJune 1$200 per partner

How to Pay your Delaware Franchise Tax:

Find your company file number here:
https://icis.corp.delaware.gov/Ecorp/EntitySearch/NameSearch.aspx
Enter Company File number and pay DE franchise tax here:
https://icis.corp.delaware.gov/ecorp/logintax.aspx?FilingType=FranchiseTax

TX Franchise Tax

Almost all business types must pay franchise tax in texas, the most significant exceptions being sole proprietorships or general partnerships. Texas, like Deleware, computes the tax due using a calculation. These franchise tax reports are due on May 15 and are filed online, but you may file an extension if necessary. There is a $50 penalty if the franchise tax report is filed after the due date, even if no tax is due with that report.

Please reach out if you need to file this tax report or an annual report, as we can do it for you quickly. As always, stay safe, and we will see you next time.