Delaware LLC Franchise Tax: Now $400, Due June 1, 2027 (Full Guide)

For years, keeping a Delaware LLC alive cost a flat $300 a year. Founders budgeted for it, formation companies advertised it, and almost every guide online still says it.

That number is now out of date.

In May 2026, Delaware passed House Bill 400, raising the Delaware LLC franchise tax to $400 per year. If you own a Delaware LLC, your first payment at the new rate is due on June 1, 2027. Here's exactly what changed, what you owe and how to pay it from India.

What Is the Delaware LLC Franchise Tax?

Every LLC formed in Delaware, or registered to do business there, must pay a flat annual tax to the Delaware Division of Corporations. Most people call it the "franchise tax," though Delaware law calls it an annual tax.

A few things make it unusual:

• It's flat. It isn't based on your income, revenue or assets.
• It's due even if your LLC earned nothing or was inactive all year.
• Delaware LLCs don't file an annual report. The tax payment is the only yearly state filing.

That last point catches many founders off guard: "no annual report" doesn't mean "nothing to do."

What Changed: $300 to $400

Delaware's House Bill 400, signed on May 21, 2026, raised the annual LLC tax from $300 to $400, effective for the 2026 tax year.

Because Delaware collects this tax a year in arrears, here's how it works in practice:

• 2025 tax year: $300, which was due by June 1, 2026
• 2026 tax year: $400, due by June 1, 2027
• Every year after: $400, due June 1 of the following year

Pro tip: If you see a guide saying "$300 a year" without mentioning House Bill 400, it's out of date. Budget $400 for every year from 2026 onward.

When Is It Due?

The tax is due on or before June 1 every year, for the previous calendar year.

The tax isn't reduced for a partial year. An LLC formed in November 2026 still owes the full $400 for 2026, due by June 1, 2027.

This is one reason some founders time their formation carefully. Forming in January gives you a full year of use for the same tax as forming in December.

How to Pay the Delaware Franchise Tax from India

You can pay entirely online in about five minutes:

1. Find your Delaware file number, a 7-digit number on your Certificate of Formation.
2. Go to the Delaware Division of Corporations' official online tax payment system.
3. Enter your file number and confirm your LLC's details.
4. Review the amount due, which is $400 for the 2026 tax year, plus any penalties if you're late.
5. Pay by card or bank transfer.
6. Save the receipt with your company records.

Delaware usually opens payments early in the year, so you don't need to wait until May.

Common mistake: Paying through look-alike websites or letters. Delaware has warned businesses about misleading tax and annual report solicitations. Always pay through the official Division of Corporations website, and treat letters asking you to pay "processing fees" with caution.

What Happens If You Pay Late?

Delaware's penalties are simple and strict:

• $200 late penalty, added right after June 1
• 1.5% interest per month on the unpaid tax and the penalty

On the new $400 tax, a late payment immediately becomes $600, plus interest that grows every month.

If the tax stays unpaid, your LLC falls out of good standing. After three years of nonpayment, Delaware can cancel your LLC's certificate of formation. Bringing it back then requires a revival filing plus every unpaid tax, penalty and interest charge.

A canceled LLC can create serious problems with banks, payment platforms and contracts, and it doesn't remove your IRS filing duties for the years it existed.

Is Delaware Still Worth It at $400?

For many founders, yes, but it depends on your plans.

Delaware remains the top choice for startups raising venture capital, thanks to its business courts and investor familiarity. But if you're a freelancer, agency owner or small SaaS founder with no fundraising plans, other states may cost far less every year:

• Wyoming: a much smaller yearly fee (see our Wyoming LLC cost breakdown)
• New Mexico: no annual report and no annual state fee, as explained in our guide to the New Mexico LLC for non-residents

Our Wyoming vs Delaware comparison explains which state suits which type of founder.

Thinking of Closing Your Delaware LLC?

If you no longer use your Delaware LLC, closing it properly can save you $400 every year. But you can't simply stop paying; you need to pay any taxes due and file the correct dissolution documents. Our guide on how to close or dissolve an LLC in Delaware walks through the steps.

Don't Forget the Other Yearly Costs

The franchise tax is only one part of keeping a Delaware LLC compliant:

• Registered agent: required in Delaware every year. See our guide to choosing a registered agent for non-residents.
• Federal filings: a foreign-owned single-member LLC files Form 5472 with a pro forma Form 1120, due April 15, 2027 for the 2026 tax year. Our guide to foreign-owned LLC taxes explains it.

Pro tip: Your IRS deadline (April 15) and Delaware tax deadline (June 1) are only six weeks apart. Handle both together each spring.

Let FormLLC Handle Your Delaware Compliance

With the new $400 rate, missing June 1 now costs at least $600. FormLLC's annual compliance service tracks your Delaware tax, registered agent and federal filings, so nothing slips.

Want your 2027 Delaware filings handled? Book a free consultation and talk to our team.