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Each year, Delaware LLCs are required to pay a $300 franchise tax by June 1. It’s a flat fee and relatively simple to manage, but it’s also easy to forget. If you missed the deadline this year, don’t panic. You’re not alone, and there are straightforward steps you can take to fix it. Let’s walk through what happens when you miss the deadline, what it means for your LLC, and how you can resolve it quickly.
What Is the Delaware Franchise Tax for LLCs?
Delaware does not charge state income tax on LLCs that do not conduct business in the state. However, every Delaware LLC must pay an annual $300 franchise tax by June 1 to remain in good standing.
What Happens If You Miss the June 1 Deadline?
Immediate Penalties
Missing the deadline triggers the following:
- Entity status is immediately "ceased good standing"
- You cannot obtain a Certificate of Good Standing
- A $200 late penalty
- 1.5% interest per month on the total unpaid balance
These fees add up quickly, so it’s important to act as soon as you realize the payment was missed.
Long-Term Consequences
If the tax and penalties continue to go unpaid, the state will declare your LLC “canceled” on June 2nd of the third year of non-payment. Once your LLC is canceled, you cannot legally transact business.
If you wish to revive your LLC after this point, you'll need to pay all outstanding fees and penalties and then file a Certificate of Revival to reinstate the charter.
How to Fix a Missed Franchise Tax Payment
Step 1: Look Up Your Balance
To look up your balance, you will need your file number with the Delaware Division of Corporations. If you don't know it, you can search by entity name by visiting the Delaware Division of Corporations page here.
Once you have your file number, you can check the balance due and payment history for your LLC by entering it here. This page will show you how much is due to get your LLC up to date on franchise taxes.
Step 2: Make a Payment
You can pay online with a credit card or bank transfer. Processing is typically immediate.
Step 3: Resume Business
If your LLC was within three years of the last payment, it will typically return to good standing status once payment is processed. You can confirm this by checking the status via the state website (for a fee) following payment or by contacting your registered agent.
If it was cancelled, you’ll need to submit a Certificate of Revival separately.
What If Your LLC Has Been Cancelled?
If your LLC has been declared cancelled due to non-payment, you will have to have to file a Certificate of Revival.
Step 1:Pay All Outstanding Fees
Just as outlined above, visit the Delaware Division of Corporations website, look up how much you owe, and pay the total due.
Step 2: Submit a Certificate of Revival
Next, file a Certificate of Revival with the state. This document restores your LLC’s good standing and confirms that all compliance issues have been addressed. You can file this yourself or work with a registered agent, like The Incorporators. If you need assistance getting your LLC back in good standing, give us a call at (800) 223-3928.
Step 3: Wait for Confirmation
Once Delaware processes your payment and filing, your LLC will be reinstated. You will receive confirmation and can resume normal operations.
How to Avoid This Issue Next Year
Use Calendar Reminders
Set a recurring reminder in early May so you have plenty of time to prepare and submit payment.
Ensure Your Registered Agent Has Your Updated Contact Information
If you missed the notification from your registered agent that your LLC franchise tax was due, contact your registered agent to ensure they have your correct contact information.
If you're unsure who your registered agent is, you can look it up by searching your entity by name with the Delaware Division of Corporations here.
We Can Help Get You Back on Track
Missing the franchise tax deadline can feel stressful, but it’s a fixable problem. The key is to act quickly before penalties pile up. The Incorporators has helped thousands of Delaware LLCs stay compliant and avoid unnecessary penalties. Whether you need help paying past-due taxes, reviving your business, or setting up reminders for next year, we’re here to help.
Questions? Call us at (800) 223-3928 or contact us here.