Where do you find Gross Assets for Delaware Franchise Tax?

The simple answer: the easiest place to find Total Gross Assets is what you reported on U.S. Form 1120 Schedule L tax form - for the Fiscal year end that is the same year that you’re filing the annual report. That is also what Delaware reflects directly in its law.

So if you’re filing your 2024 annual report, use your tax form for the fiscal year that ended in 2024.

One good reason to use what you reported on Form 1120 Schedule L: “The Secretary of State may at any time require a true and correct copy of such schedule to be filed with the Secretary of State’s office.”

However, there are several common situations where this isn’t possible or can be confusing. We’ve addressed them below.

How do you handle gross assets when you have multiple time periods on a franchise tax filing?

The Assumed Par Value method when multiple periods are involved is a prorated calculation. That means, for each period, you use a “Gross Assets” number and an “Asset Date”.

For each period, you must use a gross assets number that is “as of the nearest date on which the amount is obtainable”, within 30 days of the period end date as long as it’s in the same year.

If the period doesn’t have an end date, it’s the calendar year end - because this is a prorated calculation.

What if I have a fiscal year end other than 12/31?

If there is only one time period on the franchise tax filing, you use your Gross Assets as listed U.S. Form 1120 Schedule L tax form for the same year. 

So if you have one period on your 2024 franchise tax filing, and your Fiscal Year end is January, you would use your gross assets from your U.S. Form 1120 Schedule L for the Fiscal Year end January 2024.

What if I have a fiscal year end other than 12/31 AND multiple periods on a franchise tax filing?

If you have multiple periods on your franchise tax form, you must use gross assets “as of the nearest date on which the amount is obtainable”, within 30 days of each period end date, and gross assets from your fiscal year end date for the final period.

What if you haven’t filed your Form 1120 yet?

You can use a number from a recent balance sheet. You’re also allowed to amend this number later.

Can Discern help me with Delaware franchise tax filings?

Yes. Discern customers can file their Delaware franchise taxes directly from Discern, with the amount owed calculated automatically in the filing.

For customers who owe over $5k in Delaware franchise taxes, Discern also automatically sends a notification when they have quarterly estimated taxes due through the year.