No of where the firm is operated, Delaware mandates all LLCs to pay an annual tax of $300. On or before June 1st of each year, this tax is due. If this tax is not paid, fines and interest may be assessed.
Delaware LLCs could have to pay federal taxes in addition to the state tax. Since LLCs are regarded as pass-through organizations, the owners’ individual tax returns must include information about the LLC’s profits and losses. If there are many owners of the LLC, it must submit a partnership tax return to the IRS.
What then should be said about the notion that Delaware is a tax haven? Delaware is not a true tax haven, despite having various tax advantages including no sales tax and no intangible personal property tax. Delaware continues to impose franchise taxes, corporate income taxes, and annual taxes on LLCs.
It’s critical to understand how to make your annual fee payment if you have a Delaware LLC. The state’s online payment platform is the simplest way to make a payment. You can make a payment at the Delaware Division of Corporations in person or by mail. To avoid fees and interest, be sure to pay by June 1st or earlier.
Last but not least, the procedure to dissolve a Delaware LLC can take a few weeks to many months. The Delaware Division of Corporations will process your request and give a Certificate of Cancellation after it is complete after you file a Certificate of Cancellation and pay any unpaid taxes and fees.
In conclusion, Delaware LLCs are subject to both state and federal taxation. Despite having some tax advantages, Delaware is not a true tax haven. Make sure to pay your yearly fee on time if you have a Delaware LLC, and if you need to dissolve your company, follow the correct steps. The ideal location for you to live in Delaware will also rely on your own needs and preferences.