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Incorporate in Delaware
Is Delaware small business friendly?
FREE business incorporation, including registered state agent
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Delaware is home to the beautiful Bethany Beach, Cape Henlopen State Park, and many other unique natural locations. These natural attractions, the state’s culinary delicacies, and proximity to cities such as Wilmington make Delaware an enticing area for starting a new business.
Before you decide to incorporate in Delaware, it’s a good idea to understand how the business environment looks. Our research can help you view Delaware’s business owner demographics so you can strategically position your business to grow.
As of 2023, there are 98,356 small businesses in Delaware. These small businesses make up 98.6% of all companies in Delaware.
Women have formed many successful businesses in Delaware, with 30,400 being solely women-owned and 5,116 being co-owned by both genders. According to our research, Delaware is one of the top ten states for women-owned business growth.
Veterans own 5,521 businesses and co-own 1,180 with non-veterans in Delaware. Despite not being the most popular state for veterans to open businesses, their experiences and skills help them stay focused and succeed in their respective industries.
Hispanic people own 5,078 businesses in Delaware. While this number is smaller than that of other minority-owned businesses, Hispanic people can still persevere and succeed in Delaware.
Racial minorities own 23,431 and co-own 695 businesses in Delaware. While Delaware is not one of the top states for minority-owned companies, this small number of businesses creates a niche untapped market to explore.
See the full range of features, benefits, and pricing tailored to your needs.
Incorporate in Delaware with MaxFilingsWhat are the benefits of starting a business in Delaware?
One of the best parts of incorporating in Delaware? Living near the natural attractions. There are various beaches and parks in Delaware, perfect for those who enjoy basking in by the sea or taking a pleasant stroll with their loved ones during their time off.
Delaware also offers many business-oriented benefits for small businesses, including:
Tax benefits
Delaware has no state sales taxes, allowing businesses to save money on purchases. Delaware also has a lower income tax rate than many other states, helping them save money on annual costs.
More access to capital
Choosing to incorporate your business can improve its public perception. Incorporated companies appear more trustworthy and professional than sole proprietorships or partnerships, allowing for more funding and sales opportunities. Customers and investors are more willing to support a business they can trust.
Limited liability protection
Incorporating in Delaware can also help keep the business owners’ assets safe. Completing the incorporation process assures that business owners have limited liability protection. This protection means that if the business faces any legal action or turmoil, then only the business’s assets will be at risk.
Easier access to capital
As mentioned, forming a business in Delaware makes the company appear more trustworthy. This professionalism helps business owners sell shares to raise funds. A professional appearance makes it easier to attract investors and obtain bank loans.
Many business opportunities
Choosing to incorporate in Delaware opens up many financial and marketing opportunities. The state is close to many prominent United States cities, such as Philadelphia, Baltimore, Washington D.C., and Newark. Delaware’s location and natural attractions give small businesses plenty of potential customers.
Delaware’s Division of Small Business offers many incentive programs to help encourage the creation of new small businesses.
- EDGE Grants are given biannually to five small businesses in the STEM industry to help promote their growth.
- The Delaware State Small Business Credit Initiative programs help small businesses grow by providing them with access to capital. Businesses located in underserved areas are prioritized for funding.
- The Delaware Agricultural Financing Program provides funding and equipment loans to small businesses in the agriculture industry.
- The Delaware Strategic Fund provides low-interest loans or grants to small businesses that positively impact the state’s economy.
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Business tax climate info stats
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|---|---|---|---|---|---|
| #21 | 6.60% | 8.70% | 0 | ||
| Overall rank | Individual income tax rate | Corporate income tax rate | No state sales tax rate | ||
Source: https://taxfoundation.org/location/delaware/
If incorporating in Delaware does not suit your business’s exact needs but you still want some of these benefits, consider incorporating in California for its proximity to beautiful beaches or Florida for its low tax rates.
Overview of business structures in Delaware
Business structure |
Management |
Liabilities |
Taxes |
|---|---|---|---|
| Sole proprietorship | The owner manages the entire business | The owner is responsible for all business debts | The owner pays taxes on personal income |
| Partnership | Two or more people manage together | Partners are personally responsible for debts | Partners pay taxes on personal income |
| LLC | Managed by one or more members or managers | Owners have limited liability; business debts do not affect personal assets | Considered a pass-through entity, but can choose to be taxed as a corporation instead |
| S corp | Managed by shareholders and the board of directors | Owners have limited liability; business debts do not affect personal assets | Business income passes through to shareholders; shareholders report and pay taxes on their tax rates |
| C corp | Managed by shareholders and the board of directors | Owners have limited liability; business debts do not affect personal assets | Business pays their taxes, while shareholders pay taxes on dividends |
| Nonprofit | Managed by a board of directors | Owners have limited liability; business debts do not affect personal assets | Exempt from federal and state taxes if approved |
S corp or C corp? Understanding the differences
Discover all you need to know about the differences between S and C corporations in Delaware. MaxFilings breaks down the key differences between these two corporate entities to help you choose the best fit for your business needs.
Is it worth incorporating in Delaware?
When completing the incorporation process, knowing what steps to take and understanding state laws is essential. Different business structures will have different steps, so avoid common incorporation mistakes by understanding which one you are interested in.
We recommend contacting a professional with legal questions or concerns before starting the incorporation process.
If you’re ready to incorporate, MaxFilings offers services to help you through the process with no upfront fees.
Explore more about Delaware incorporation
Delaware incorporations have access to plenty of support and benefits from the state, but it’s just as important to understand the challenges.
Here is more information about forming a corporation in Delaware so you can determine if it’s the right path for you.
Delaware C Corp Formation
This detailed guide teaches how to set up a C corporation in Delaware. Discover the benefits of this business structure and follow a simple, step-by-step process to establish your corporation.
Delaware S Corp Formation
Discover how to establish an S corporation in Delaware with this comprehensive guide. MaxFilings will show you the benefits and process for forming an S corporation in the state.
Delaware LLC Formation
Learn about the process and benefits of forming your own Limited Liability Company in Delaware. Our informative guide will cover any steps and forms to be filed when incorporating this business structure.
Delaware Nonprofit Formation
Learn everything you need to know about creating a nonprofit organization in Delaware. This guide will cover the business benefits and unique opportunities for positively impacting communities in Delaware.
Incorporating doesn’t need to be an overly complicated process. MaxFilings expert incorporation team can provide clear, step-by-step guidance without any upfront costs.
Our basic incorporation package is free—you only need to pay state fees.
Enjoy a year of complimentary registered agent services to get you started at no additional cost.
MaxFilings business incorporation services aim to provide a high-quality incorporation experience without unwanted hidden costs.
Let us prepare and file your forms while you focus on running your business.
At MaxFilings, we are committed to supporting you every step of the way.
