I
United States

United States

Company Formation in Delaware

State of Delaware — Division of Corporations

Formation Time
1–2 business days
Min. Capital
No minimum
Corporate Tax
0% state (no DE operations) / 21% federal
Foreign Ownership
100%

Overview

Delaware is the undisputed global benchmark for corporate law and business incorporation. Over 68% of Fortune 500 corporations, 93% of US initial public offerings (IPOs), and hundreds of thousands of international startups are incorporated in Delaware. The state's primary competitive advantage is the Delaware Court of Chancery — a dedicated 230-year-old business court where corporate disputes are decided by specialized chancellors rather than inexpert juries, producing the most predictable, mature body of case law in the world. Delaware levies zero state corporate income tax on companies that do not conduct physical operations within the state. For non-US founders, a single-member Delaware LLC with no US-effectively connected income (ETBUS) pays 0% US federal tax, provided mandatory annual IRS Form 5472/1120 information reporting and Delaware Franchise Tax filings are maintained. Delaware also offers expedited same-day and 2-hour corporate filings, complete member privacy on state formation documents, and the gold standard C-Corporation structure demanded by Silicon Valley venture capital investors, Y Combinator, and global accelerators.

Court of Chancery
VC & YC preferred
0% state tax
Remote US banking
Confidential LLCs

Why Choose Delaware

1

Delaware Court of Chancery — specialized corporate dispute resolution with 200+ years of precedents

2

Preferred jurisdiction for VC investment, Y Combinator, and US institutional capital

3

0% Delaware state corporate tax for businesses operating outside Delaware

4

0% state sales tax and 0% personal income tax for non-resident owners

5

Confidential LLC formation — member and manager names not public in state registry

6

Same-day, 2-hour, and 24-hour expedited state filing services

7

Flexible Delaware Series LLC and Statutory Trust structures available

8

Global bankability with remote US business accounts via Mercury, Relay, and Brex

Business Entity Types

EntityOwnershipDirectorsCapitalTaxBest For
C-Corporation100%1None21% federal corporate income tax; 0% DE corporate tax if no in-state businessVC-backed startups, SaaS, tech platforms seeking US investment or future IPO
LLC100%N/A (member or manager managed)NonePass-through taxation; 0% US federal tax for non-US owners with no US incomeInternational e-commerce, digital agencies, holding companies, consulting
Series LLC100%N/ANoneElective pass-through per seriesReal estate portfolios, multi-asset holding, IP licensing vehicles
Statutory Trust100%1 trustee (at least one Delaware trustee)NoneTrust tax treatment; grantor trust status availableSecuritization, 1031 real estate exchanges, investment funds

Step-by-Step Formation Process

1

Entity Selection & Name Clearance

1 day

Clear corporate name in Delaware Division of Corporations database and determine entity structure (LLC vs C-Corp).

2

State Filing & Certificate Issuance

1–2 days

File Certificate of Formation/Incorporation with Delaware Secretary of State via expedited channel.

3

IRS EIN Issuance

3–10 business days

Obtain Employer Identification Number (EIN) from the IRS via Form SS-4 for tax and banking operations.

4

FinCEN BOI & Governance Drafting

2–3 days

Complete Corporate Transparency Act (BOI) reporting to FinCEN and execute Operating Agreement / Bylaws.

5

Corporate US Bank Opening

3–7 business days

Establish corporate multi-currency US bank accounts with integrated ACH, wire, and card facilities.

Costs & Fees

Government / License FeeUSD 190+
Our Service FeeUSD 900 – 2,500
Annual RenewalUSD 300+

Fees are indicative and may vary based on business activity, entity type, and additional approvals required. Contact us for a precise custom quote.

Get Custom Quote

Banking

Delaware entities enjoy first-tier bankability. Non-resident founders can secure remote FDIC-insured accounts via fintech banking platforms (Mercury, Relay, Brex) and tier-one commercial banks.

Account Opening Time
3–7 business days
Multi-Currency
Yes — multiple currencies supported

Recommended Banks

Mercury (FDIC insured through partner banks)Relay FinancialBrexJPMorgan ChaseSilicon Valley Bank / First Citizens

Tax Overview

Corporate Tax
0% state tax (no DE operations); 21% flat US federal rate (C-Corp only)
Personal Income Tax
0% state income tax for non-residents
VAT / Sales Tax
0% state sales tax
Capital Gains Tax
0% for non-resident aliens on non-US real estate gains
Withholding Tax
30% statutory federal withholding on US-source dividends/royalties (reduced by DTA treaties)
Double Tax Treaties
68 countries

Delaware LLC annual franchise tax is a flat $300 due June 1. C-Corp franchise tax starts at $175 (using Assumed Par Value Capital method to prevent high share authorization penalties). Foreign-owned LLCs must file annual Form 5472 + Form 1120 by April 15.

Frequently Asked Questions

Why do venture capitalists and accelerators demand Delaware C-Corps?
Investors prefer Delaware C-Corporations because the Delaware General Corporation Law (DGCL) provides unmatched legal certainty. The Delaware Court of Chancery resolves shareholder and governance disputes rapidly with seasoned corporate judges instead of unpredictable juries. Delaware also standardizes preferred stock mechanisms, stock option pools (409A), and board rights that institutional investors require.
Do non-US residents pay federal income tax on a Delaware LLC?
A single-member Delaware LLC owned by a non-US resident with no physical US presence, no US employees, and no 'US effectively connected income' (ETBUS) generally pays 0% US federal income tax. However, the owner must file annual IRS Form 5472 with a pro-forma Form 1120 by April 15. The IRS imposes a severe $25,000 penalty for failing to file this informational return on time.
How does Delaware Franchise Tax work for C-Corporations?
Delaware offers two methods to calculate C-Corp franchise tax: the Authorized Shares Method and the Assumed Par Value Capital Method. Startups authorizing 10,000,000 shares will receive an initial tax notice exceeding $80,000 under the default shares method. By calculating under the Assumed Par Value Capital Method using actual gross assets and paid-in capital, the tax typically reduces to the minimum $400, eliminating large unintended tax bills.
What is the FinCEN BOI filing requirement for Delaware entities?
Under the US Corporate Transparency Act (CTA), all non-exempt entities formed in Delaware must file a Beneficial Ownership Information (BOI) report with the Financial Crimes Enforcement Network (FinCEN). The report discloses full legal name, date of birth, residential address, and passport identification of all individuals holding 25%+ ownership or exercising substantial executive control.
Can I open a US bank account for my Delaware company without visiting the US?
Yes. Non-US founders can open FDIC-insured US corporate bank accounts remotely through Incorp International's banking partnerships with Mercury, Relay, and Brex. These accounts provide full USD checking, international wire, ACH payments, and virtual corporate debit cards without requiring a US Social Security Number or physical trip.
What is the difference between a Delaware LLC and a Delaware C-Corp?
An LLC is a pass-through entity where profits flow directly to members' tax returns without corporate-level taxation, offering minimal statutory formalities and complete operating flexibility. A C-Corporation is a distinct taxable entity (taxed at 21% federal) that can issue multiple classes of shares, adopt equity incentive plans, and accept institutional venture capital.