Compliance is Key for your Delaware Company
Maintaining your Delaware company’s active status and compliance with the Delaware Division of Corporations by retaining a Delaware-based Registered Agent and paying the Delaware Franchise Tax is vital. There are also many great reasons to keep your company in existence in Delaware. It's important to stay in tune with the necessary annual requirements to ensure your company can continue to operate and conduct lawful business activities.
One important aspect of corporate compliance is keeping your current Delaware Registered Agent informed of any changes, such as your contact address or email address. Many clients move and forget to update their Delaware Registered Agent with their new address. Clients sometimes assume that no news is good news, but later they may find out that their credit card company has locked their account because the company is no longer in existence in Delaware. If the contact details had been updated, notices pertaining to the annual Delaware fees would have been received.
Another reason to keep up with corporate compliance requirements is to remain in good standing with your bank. In some instances, banks shut down company accounts if they discover that the Delaware company is no longer in existence. This can be very problematic, as the company might need access to the account to pay employees and cover internal bills.
The bank may not permit access to the funds in the account until the company is formally revived and compliant with the Delaware Division of Corporations. This situation would make it very difficult to meet the overall needs of the company’s clients, customers, or employees if the company is stuck with a frozen account. The company would not have access to its credit card or funds to continue conducting business.
Or, perhaps the company submitted a bid on a contract, and the business partner does their due diligence by checking if the company is currently active and in existence in Delaware. If the company is not in existence or in good standing, being notified by the business partner can be very embarrassing and could result in losing the bid and the overall deal.
If your company is not active or in existence with the Delaware Division of Corporations, a Certificate of Revival will need to be filed. The company might owe Delaware Franchise Tax at the time the renewal is filed. Clients might also be required to supply or obtain a Delaware Certificate of Good Standing during or after the revival process has been approved.
When in doubt, reach out! Harvard Business Services, Inc. (HBS) provides plenty of avenues for clients to access information about their Delaware company. Clients can communicate with our specialists via phone, Skype, WhatsApp, and email for updates on their company status. At HBS, we make information easily accessible, and clients can manage their MyControlDesk (MCD) account via our website. HBS wants to make the process of keeping your company compliant in Delaware easy for you!
If you have any questions about your Delaware company status, feel free to contact us at 1-302-645-7400 or 1-800-345-2677 ext. 6900 or via email at info@delawareinc.com. We can also be reached via skype at delawareinc.
*Disclaimer*: Harvard Business Services, Inc. is neither a law firm nor an accounting firm and, even in cases where the author is an attorney, or a tax professional, nothing in this article constitutes legal or tax advice. This article provides general commentary on, and analysis of, the subject addressed. We strongly advise that you consult an attorney or tax professional to receive legal or tax guidance tailored to your specific circumstances. Any action taken or not taken based on this article is at your own risk. If an article cites or provides a link to third-party sources or websites, Harvard Business Services, Inc. is not responsible for and makes no representations regarding such source’s content or accuracy. Opinions expressed in this article do not necessarily reflect those of Harvard Business Services, Inc.