Start a Business in Delaware
Corporate Compliance by Local Corporate Guides®
Starting a business in Delaware can and should be easier than you think. You file simple forms with the secretary of state, and your business is formed! Obviously there’s a few more things than that, but if you’d like to start your own business yourself, you will find it easy to hire us as your registered agent and you’ll find all the forms you could file to start a business in Delaware, along with great filing instructions on the quickest and cheapest ways to start your business in Delaware.
How to Start a Business in Delaware
You file Certificate of Incorporation for a Delaware corporation or certificate of formation for a Delaware LLC with the DE Secretary of State.
You obtain a federal tax ID number (FEIN or EIN) with the IRS after you have confirmation and filed articles from the State of Delaware showing your approved Delaware business.
Opening a business banking account under your new Delaware business name should be easy with these two items.
All Delaware businesses are required to have a Delaware Business License. The Delaware Business License obtained from the Division of Revenue. If you have employees you will have to register with the Department of Labor and the Division of Workers Compensation. Delaware has a One Stop Business Licensing Service that allows you do all of these registrations. We provide all these forms and links in your online account.
If your business trade requires a license, you’ll have to apply for a license with the Delaware licensing board. (Most businesses don’t.) But if you do, these quick links and contact details are in your online account.
Some local cities or counties have a general business license, but most don’t. You obtain a local trade license if the city or county you’re going to be working in requires it.
If you’re going to have an office or shop you might need an approval from the city zoning for your type of business in that location.
Are You A Do-It-Yourselfer? You Can Save Some Money:
If you want to start a business in Delaware yourself, you can just hire us as your Delaware registered agent. You’ll instantly have the Delaware LLC or corporation forms to file, along with filing instructions on the quickest, cheapest, and most efficient way to form a Delaware corporation or LLC. You’ll also get the ongoing support of our online tools, free Delaware mail forwarding service for occasional business mail, report reminders and the support of a professional Delaware registered agent service.START YOUR DELAWARE BUSINESS TODAY
Delaware LLC vs Corporation
Small business owners like the structure of an LLC. Because they often come with fewer annual requirements, flexible management, and excellent tax options, LLCs are easier to maintain over long periods of time. Corporations, on the other hand, allow owners to sell stock and attract strong investors. The long standing, well-defined management structure can also be very appealing.
What about Delaware? Pros and cons for owning a Delaware LLC vs a Delaware corporation?
In terms of cost and paperwork, a Delaware LLC is the clear winner. Although initially it will cost slightly more to form an LLC ($90 vs $89), the cost of maintaining your business will typically be less than a corporation. For example, Delaware LLCs are not required to file an annual report. Instead, they pay an annual franchise tax of $300—which, is a high amount, but you won’t have to worry about extra filings. Corporations must file an annual report ($50) AND pay a franchise tax that could go as high as $200,000. OUCH!
Delaware corporations also tend to get hit harder during tax season—the corporate income tax rate is 8.7%. Plus, corporations are often subject to double taxation. LLCs that keep their default tax classification won’t pay state corporate income taxes—saving LLCs lots of time and money.
Whether you start a Delaware LLC or a Delaware corporation will depend on your specific needs and goals. If having the option to sell stock and attract investors is important to you, then definitely consider a corporation. But, if you’re looking to start a small, easy-to-maintain business, then you might choose the LLC structure.
If you want a corporation, you file a Delaware Certificate of Incorporation:
The Delaware Certificate of Incorporation costs a minimum of $89 with the Delaware Secretary of State. We custom draft your Delaware Certificate of Incorporation when you hire Northwest to start your Delaware business. The basic requirements of Delaware corporations are:
- An incorporating Delaware ending such as Inc, corporation, or incorporated;
- A general corporation purpose;
- The amount of Delaware corporation shares you would like to authorize;
- The par value of the shares;
- The name, address, and signature of the Delaware incorporator; and
- The registered agent of the Delaware corporation.
Delaware does not require original signatures on new DE corporation filings. The stamped certificate of incorporation will be sent to the incorporator’s mailing address.
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If you want a LLC, you file a Delaware Certificate of Formation:
To form a Delaware LLC, you file a Delaware Certificate of Formation. The basic requirements of Delaware LLC filings are:
- The business name must have a limited liability company ending or variation of it such as LLC or L.L.C.;
- The Delaware business name must be different than already registered Delaware businesses;
- The duration of the Delaware LLC, (perpetual unless you state a date);
- Delaware limited liability companies do not need to state a LLC purpose;
- The Delaware registered agent and the physical address;
- The names and addresses of the member and managers are not required; and
- The name and signature of the Delaware LLC organizer.
Delaware does not require original signatures on new DE LLC filings. You’ll get a stamped certificate mailed back to you after the state approves your filing.