How to Incorporate in Delaware
If you’re looking to incorporate in Delaware, you’re in the right place. This guide will help you file formation documents, get tax identification numbers, and set up your company records.
How to Incorporate in Delaware
Incorporating means starting a corporation. If you want to form an LLC, please see "How to Form an LLC in Delaware".
Is your corporation for-profit or not-for-profit? If you are starting a nonprofit, please see "How to Start a Non-Profit Organization in Delaware".
C-Corp and S-Corp refer to taxation with the IRS, not to legal structures. Your corporation is taxed as a C-Corp unless you file an election to be taxed as an S-Corp (explained below).
The legal name of your corporation may not conflict with any other registered name. Check availability of your desired name by conducting a name search.
- Name Search:
- Delaware Name Availability Search system
- Name Reservation:
- Shall contain 1 of the words "association," "company," "corporation," "club," "foundation," "fund," "incorporated," "institute," "society," "union," "syndicate," or "limited," (or abbreviations thereof, with or without punctuation), or words (or abbreviations thereof, with or without punctuation) of like import of foreign countries or jurisdictions (provided they are written in roman characters or letters) DC §8-102-a-1
Identify the corporation’s Delaware registered agent. This individual or company receives notice of lawsuit and other legal service for the corporation.
File the articles of incorporation to create your corporation.
Your corporation must keep correct and complete books and records. Your filed articles of incorporation are
the first document for your corporate records. Your corporation will generate many other official records
such as bylaws, meeting minutes, and your EIN.
Office supplies intended for a corporation will help you stay organized and save time. Optionally, get a corporate record book, seal, and document templates.
Draft bylaws (potentially using a template) which is the governing document for the corporation. The bylaws may contain any provision, not inconsistent with law or with the certificate of incorporation, relating to the business of the corporation, the conduct of its affairs, and its rights or powers or the rights or powers of its stockholders, directors, officers or employees (DC 8-1-I §109). You will review and ratify the bylaws at your first board of directors meeting.
The initial directors serve on the board until the annual meeting of shareholders (when directors are elected to the board). If the initial directors are not named in the articles of incorporation, they are appointed by the incorporator. The incorporator documents and signs this action for the corporate records.
Hold the first meeting of the board of directors.
... an organization meeting... shall be held, either within or without this State, at the call of a majority of the incorporators or directors, as the case may be, for the purposes of adopting bylaws, electing directors (if the meeting is of the incorporators) to serve or hold office until the first annual meeting of stockholders or until their successors are elected and qualify, electing officers if the meeting is of the directors, doing any other or further acts to perfect the organization of the corporation, and transacting such other business as may come before the meeting.
DC 8-1-I §108
Keep minutes of this meeting. The following state laws apply unless overridden by the organizational documents, where permissible.
The owners may be issued stock certificates to serve as proof of ownership in the corporation. Remember to hold the first annual meeting of the shareholders (the owners of the corporation) according to bylaws and keep minutes of this meeting.
The following state laws apply unless overridden by the organizational documents, where permissible.
|Shareholders||Annual Shareholder Meeting|
Your corporation must obtain an EIN regardless of whether it will hire employees.
- Submit to:
- Internal Revenue Service
- IRS Form SS-4
- IRS Pub 1635: Understanding Your EIN
- Filing Method:
- Mail, phone, fax, or apply online with the IRS
- Immediately online
- The IRS website is only available during certain hours. Print your EIN before closing your session.
Delaware corporations must obtain a Delaware business license and paying the accompanying gross receipts tax. In addition, Delaware corporations are required to register with the Division of Revenue for other tax accounts. Delaware offers a consolidated application to register your organization with the Division of Revenue, the Division of Unemployment Insurance and the Office of Workers Compensation.
- Submit to:
- Delaware Division of Revenue
- Form CRA: Combined Registration Application for State of Delaware Business License and/or Withholding Agent
- Filing Method:
- Mail or online
- $75 for first business license. Fees vary based on applicable licenses, locations, and accounts.
By default, your corporation is taxed as a C-Corporation. Some corporations, especially smaller ones, benefit from electing S-Corp tax treatment:
- C-Corps suffer from double taxation: the corporation pays taxes on profits then members pay taxes on their distributions. If profits exceed $250,000 per owner, you provide employee benefits, or you will re-invest most of your profit in the business, you may benefit from the low tax rates on retained earnings under C-Corp treatment.
- S-Corp treatment avoids double-taxation. It is generally the best choice for small businesses. To accomplish this, file Form 2553: S-Corp Election with the IRS.
To run your business legally, you must obtain applicable licenses and permits. The easiest way to navigate the wide range of federal, state, and local requirements is to search by your business type and locality using the Small Business Administration Business License & Permit look-up tool.
You must file federal and state tax returns. You must also file:
- Delaware corporations file a Delaware Annual Report & Franchise Tax.