An LLC is a corporate structure that provides limited liability protection to its owners, which has made it a popular choice for small businesses. However, these businesses must adhere to certain rules and regulations if they are to remain compliant with the law. This article will provide an overview of the ongoing compliance requirements for LLCs registered in the state of Delaware this 2023.
Ongoing Compliance Requirements
LLCs are required to file an annual report, pay an annual franchise tax, and keep their business address current with the Delaware Division of Corporations (DDC). The DDC also requires that all LLCs maintain valid Registered Agents who can receive legal documents on behalf of the company. LLCs must also hold regular meetings and record minutes from those meetings in order to be considered compliant.
The Annual Report and Franchise Tax
In order to remain compliant, LLCs must file an annual report with the DDC by June 1st of every year. If you fail to do so, your company may be subject to fines or even dissolution. The annual report is used to update any changes in ownership or contact information as well as provide current financial information about your company. It is important to note that filing the annual report does not relieve you from paying your franchise tax; this payment is due by March 1st each year. The amount due depends on how much income your business earns each calendar year and ranges from $175 – $250/year.
Registered Agent Requirements
LLCs must have a Registered Agent who is responsible for receiving service of process on behalf of the company as well as other official documents such as subpoenas and notices from regulatory agencies like the IRS or Department of Labor & Industry (DLI). The person designated as Registered Agent must be available during normal business hours at an address within Delaware that can accept mail deliveries; post office boxes are not acceptable locations for Registered Agents. Additionally, any changes in Registered Agent need to be reported within 60 days so that service of process can continue without interruption.
Properly maintaining ongoing compliance with Delaware’s laws is essential for all LLCs registered in the state this 2023. Businesses should ensure they are up-to-date on filing their Annual Report and paying their Franchise Tax on time each year, maintaining valid Registered Agents at all times, holding regular meetings and recording minutes from those meetings, and keeping their business address current with the DDC. By adhering to these rules and regulations, businesses can remain compliant and avoid costly fines or potential dissolution down the line.