Key figures
Delaware accounting
2026, with sources
- Corporate income tax rate
- 8.7%On federal taxable income, as modified, allocated and apportioned to Delaware.
- Consolidated or combined returns
- Not permittedEach corporation files as if it had filed a separate federal return.
- Statutory-office-only Delaware corporations
- No income tax returnExempt from the income tax return under 30 Del. C. § 1902(b)(6); franchise tax still due.
- Bonus depreciation
- Decoupled from 100%Delaware applies the TCJA phase-down: 40% for 2025, 20% for 2026, 0% from 2027; the decoupling sunsets after 2030.
Two different Delaware taxes
Most startups meet Delaware as the state of incorporation, and the tax that follows from that is the Delaware franchise tax, owed to the Division of Corporations whether or not the company does anything in the state. The corporate income tax is a different tax, run by the Division of Revenue, and it applies only to corporations doing business in Delaware.
A corporation whose activity in Delaware is limited to maintaining its statutory office is exempt from filing the income tax return under 30 Del. C. § 1902(b)(6). Once the company has an office, an employee or revenue-producing activity in Delaware, it files Form CIT-TAX and pays 8.7% on its Delaware share of federal taxable income.
Separate returns, gross receipts apportionment
Delaware does not allow consolidated or combined returns. Each corporation in a group computes its income as if it had filed a separate federal return, so a parent and its operating subsidiary each have their own Delaware position.
Since January 1, 2020, apportionment uses only a gross receipts factor. The instructions place receipts from services in the Delaware numerator when the services are rendered in Delaware, so for a services or software business the question is where the work is performed, not where the customer sits.
Where the provision differs from federal
The return starts from federal taxable income. Delaware decoupled from the 2025 federal law’s 100% bonus depreciation and its special allowance for qualified production property, and from the retroactive deduction of 2022–2024 capitalized research costs. Those differences are reported on Schedule DCP and are the usual Delaware book-tax differences for a company that buys equipment.
For the tax provision, a Delaware C-corp with no Delaware operations usually has no Delaware income tax line at all; the franchise tax is not an income tax and is booked as an operating expense. A company with Delaware operations books current Delaware income tax and tracks the depreciation difference as a deferred item.
The federal baseline
This page covers what Delaware adds. The federal rules underneath it apply here too.
Common questions
We’re a Delaware C-corp with no one in Delaware. Do we file a Delaware income tax return?
Usually not. A Delaware corporation whose only activity in the state is maintaining its registered (statutory) office is exempt from filing the Delaware corporate income tax return under 30 Del. C. § 1902(b)(6). It still owes the annual franchise tax and annual report to the Division of Corporations, which is a separate tax on being incorporated, not on income.
Does Delaware follow the 2025 federal bonus depreciation and Section 174 changes?
Delaware decoupled from it. Under HB 255, explained in the Division of Revenue’s TIM 2025-2, Delaware keeps the old TCJA bonus schedule (20% for 2026, 0% from 2027) instead of the federal 100%, and adds the difference back on Schedule DCP. For research costs, Delaware follows federal expensing from 2025 but not the retroactive deduction of 2022–2024 capitalized amounts.
Accounting next door
- MDMaryland accountingMaryland taxes corporations at a flat 8.25% on separate-company returns, with a single receipts factor and services sourced to the customer. For 2025 it decoupled from federal R&D expensing.
- NJNew Jersey accountingNew Jersey’s Corporation Business Tax is 9% on income over $100,000, plus a 2.5% Corporate Transit Fee above $10 million, with mandatory combined reporting and market-based sourcing. Every filer pays a minimum tax of at least $500, and NOL deductions are capped at $1 million a year through mid-2030.
- PAPennsylvania accountingPennsylvania’s corporate net income tax is 7.49% for 2026 and falling, on separate-company returns with market-sourced services. Losses are capped as a share of income, and federal R&D expensing and bonus depreciation don’t carry through.
Founder guides on this
- US GAAPUS GAAP for early-stage startups, in plain EnglishAccrual accounting, revenue recognition (ASC 606), leases (ASC 842), stock compensation and capitalized software: what each means for a small company.
- R&D taxThe R&D tax credit and Section 174A for startupsEngineering salaries can earn a federal R&D credit against payroll tax, and Section 174A lets you deduct US research again. What qualifies, what to track.
- FundraisingAudit-ready books before your Series AInvestors, lenders and auditors ask for the same things: accrual statements, reconciled accounts and support for every balance. How to be ready first.
More of the Delaware guide
- ReceivablesReceivables and sales tax in DelawareSales tax registration, economic nexus, whether SaaS is taxable, and collecting from customers
- PayablesPayables and contractors in DelawarePaying vendors and contractors: 1099 filing, use tax, contractor tests and withholding
- PayrollPayroll taxes and employer rules in DelawareWithholding, unemployment insurance, paid leave, minimum wage and the rules on paydays
- ComplianceCompliance and filings in DelawareRegistering to do business, annual reports, franchise tax and the filing calendar
- AdvisoryAdvisory: credits and decisions in DelawareCredits, incentives and the decisions that are cheaper to get right the first time
Sources
Checked against each agency’s own page on . Rates and thresholds change, usually on January 1.
General information for US companies, not tax, legal or accounting advice for yours. Rules and thresholds change; confirm the specifics with a CPA or the agency before you act on them.