Delaware Franchise Tax Calculator (APV Method)
Calculate your Delaware franchise tax using the Assumed Par Value method. This often saves thousands compared to the default Authorized Shares method.
Why Foreign Investors Choose Delaware
Over 60% of Fortune 500 companies are incorporated in Delaware, and for good reason. Delaware offers a unique combination of flexible laws, specialized courts, and favorable tax treatment that makes it the default choice for serious business formation.
Court of Chancery
Delaware's specialized business court has no jury trials. Judges are experts in corporate law, providing predictable and sophisticated rulings on business disputes.
Flexible LLC Statute
Delaware's LLC Act is the most flexible in the nation. You can customize your operating agreement with virtually any provisions you want.
No State Income Tax
Delaware does not tax LLC income earned outside the state. If your business operates elsewhere, you pay no Delaware income tax.
Privacy Protection
Delaware does not require public disclosure of LLC members. Your ownership can remain private with proper structuring.
Established Case Law
Decades of court decisions create predictable outcomes. Attorneys and investors know what to expect from Delaware law.
Investor Recognition
US investors prefer Delaware entities. If you plan to raise capital, Delaware immediately signals credibility.
Delaware LLC Costs
- Formation Fee: $90 (state filing fee)
- Annual Franchise Tax: $300 (flat fee for LLCs)
- Registered Agent: $50-150/year (required)
- Operating Agreement: Draft yourself or hire an attorney
Important: LLCs Pay a Flat $300 Franchise Tax
Unlike Delaware corporations (which use the APV or Authorized Shares method), Delaware LLCs pay a simple flat fee of $300 per year. The calculator above is for corporations. If you are forming an LLC, your annual franchise tax is always $300 regardless of your capital structure.
Formation Process for Foreign Investors
- Choose your LLC name - Must be unique in Delaware and include "LLC" or "Limited Liability Company"
- Appoint a Registered Agent - Must have a physical Delaware address (I can recommend reliable agents)
- File Certificate of Formation - Submit to Delaware Division of Corporations ($90 fee)
- Draft Operating Agreement - Not filed with the state but essential for your internal governance
- Obtain EIN - Apply for your Employer Identification Number from the IRS
- Open US Bank Account - With your EIN and formation documents
Tax Considerations for Foreign Investors
As a foreign investor holding a Delaware LLC, you need to understand the tax implications:
- Pass-through taxation: LLCs are typically "disregarded entities" or partnerships for US tax purposes. Income passes through to members.
- ECI (Effectively Connected Income): If your LLC earns income connected to a US trade or business, you may owe US income tax.
- FIRPTA: If your LLC holds US real estate, special withholding rules apply when selling.
- Treaty benefits: Check if your home country has a tax treaty with the US that may reduce withholding rates.
I strongly recommend consulting with a tax professional who specializes in international taxation before forming your LLC.
Related Tools & Templates
Documents and calculators to support your Delaware LLC formation.
LLC Operating Agreement Generator
Create a customized operating agreement for your Delaware LLC with our interactive generator.
Generate Operating AgreementDelaware APV Calculator
Calculate Delaware franchise tax for corporations using the Assumed Par Value method.
Open APV CalculatorBoard Resolution Generator
Generate board resolutions for major LLC decisions and actions.
Create Board ResolutionEntity Formation Overview
Compare Delaware LLC vs Wyoming LLC vs Corporation options for your investment.
Compare Entity TypesBanking for Foreign Investors
Learn how to open US bank accounts and move money without compliance issues.
Banking GuideVisa Pathways
Explore E-2, EB-5, and other visa options that may be available through your US investment.
Visa OptionsReady to Form Your Delaware LLC?
Schedule a consultation with me. I will review your situation and ensure your Delaware LLC is set up correctly from day one.
Sergei Tokmakov, Attorney — California Bar #279869