Who this is for
- Founders who live outside the US forming a Delaware C corporation
- Non-US co-founders deciding share counts, founder stock and first-year filings
Not covered here
- US-resident founders forming a Delaware startup
- Choosing between an LLC and a corporation
- Home-country tax on the founder or the corporation
- Filling in the first Form 1120 line by line
Delaware C corp for non-US founders: what are the steps?
A founder living outside the US can form a Delaware C corporation and get its EIN without a US visit or an SSN; banks set their own requirements. Work in this order: agent, certificate, organizing consents, founder stock, EIN, then bank and address. Year one then brings federal and Delaware filings even if the company earns nothing.
| Step | What it takes | Cost or timing |
|---|---|---|
| 1. Registered agent | A Delaware agent with a Delaware street address (Division of Corporations) | The agent's own fee |
| 2. Name check | Optional reservation holds a name for 120 days (Division of Corporations) | $75 |
| 3. Certificate of incorporation | Name, agent, purpose, authorized shares and par value, incorporator | From $109, more with more total par value or more no-par shares (fee schedule) |
| 4. Organizing consents | Bylaws, directors and officers, signed in writing or electronically | No state filing |
| 5. Founder stock | Board consent, purchase agreement, payment, stock ledger | Any 83(b) election within 30 days if the shares vest |
| 6. EIN | Form SS-4 by phone or fax | Fax: generally within 4 business days |
| 7. Bank account | Opened after the EIN; see US business address and bank account | The bank's own checks |
| 8. Year-one filings | Form 1120, any Form 5472, Delaware annual report and franchise tax | Form 1120 by the 15th day of the fourth month after year-end; Delaware by March 1 of the following year |
What makes a case not simple: founders taxed in two countries; money a founder lends the corporation, pays on its behalf or receives from it, which can require Form 5472 and a $25,000 penalty if a required form is missed; shares that vest, with a 30-day election window; a large share authorization that produces a large first Delaware notice; and activity in a US state, which can require registering there.
What to gather: each founder's legal name, home address, citizenship and country of tax residence; the agent's name and Delaware address; the share plan (authorized shares, par value, who buys how many and at what price, any vesting); how each founder will fund the company, by buying shares or by lending; and the year-end the corporation will use.
Can a non-US citizen be the only director, officer and shareholder?
Yes. Delaware lets any person form a corporation whatever their residence or domicile (8 Del. C. § 101(a)). The board can be one director, who must be a natural person and need not own shares, and one person can hold every office unless the certificate or bylaws say otherwise (8 Del. C. §§ 141(b), 142(a)). These sections set no citizenship or residence condition for directors or officers.
The one Delaware presence required is a registered agent. Every Delaware corporation must keep an agent in Delaware with a physical street address there; a business can be its own agent only if it is physically located in Delaware (Division of Corporations). For choosing an agent, see Registered agents. For a mailing address and bank account, see US business address and bank account.
What goes in the certificate of incorporation, and why do authorized shares matter?
The certificate states the corporation's name, its Delaware registered office and agent, its purpose, how many shares it may issue and their par value (or that they have none), and the incorporator's name and mailing address (8 Del. C. § 102(a)). Par value is the lowest price at which a share may be issued, not what it is worth (§ 153(a)); the incorporator is the person who signs and files the certificate. The share count and par value then drive two costs:
- Filing fee. Delaware's fee starts at $109 for a one-page certificate and rises with the stock authorized: for par value shares, with their total par value (shares × par), so millions of shares at a tiny par add little; for no-par shares, with the share count (fee schedule; 8 Del. C. § 391(a)(1)).
- Franchise tax. Delaware can compute the tax on authorized shares, including shares never issued. The other method uses issued shares and gross assets, and the corporation must report those figures to have it applied (Division of Corporations; 8 Del. C. § 503).
| Method | How Delaware computes it | Full-year minimum |
|---|---|---|
| Authorized shares | $175 up to 5,000 shares; $250 for 5,001 to 10,000; plus $85 for each further 10,000 shares or part | $175 |
| Assumed par value capital | Gross assets ÷ issued shares = assumed par per share (stated par if higher); × authorized shares = assumed capital; $400 per million of it | $400 |
Either method stops at $200,000 for an ordinary corporation (Division of Corporations). The trap: millions of authorized shares at a tiny par value make the authorized shares result large. For a company with modest assets, the assumed par value capital method can give a much smaller result, as low as $400 for a full year, depending on its gross assets and issued shares. Choose the share count knowing both effects. The full calculation is in Delaware franchise tax.
How do I issue founder stock while living abroad?
The board approves the issue, the founder pays at least par value, and the corporation records the shares in its stock ledger. All of it can be done remotely: Delaware lets the incorporator and the board act by written or electronic consent (8 Del. C. § 108(c); § 141(f)) and lets the stock ledger be kept electronically (§ 224).
- Organize. The incorporator, or the directors named in the certificate, adopts bylaws and elects directors; the directors elect officers (§ 108).
- Approve the issue. A board resolution sets the number of shares, the buyer and the price. Payment can be cash, property or another benefit to the corporation (§ 152).
- Pay. Par value shares must be issued for payment worth at least their par value (§ 153(a)). The board sets the form and manner of payment, and the shares are fully paid once the corporation receives it (§ 152). Keep the transfer record with the board consent; it shows what was paid and when.
- Record. Enter each stockholder's name, address and shares, and every issue and transfer, in the stock ledger (§ 219(c)).
If the founder shares vest over time, an 83(b) election, if made, is due within 30 days of the transfer (26 USC 83(b)(2)). Whether a founder abroad needs one, and how to file it, is in Founder shares that vest. Paying with code, a domain or other property instead of cash raises its own tax and reporting questions; see Putting money into your US corporation from abroad.
How do I get an EIN with no SSN or ITIN?
Apply with Form SS-4 by phone or fax; the online application is not open to applicants with no US residence, office or place of business, and it needs a responsible party with an SSN, ITIN or EIN. The responsible party is the individual who ultimately owns or controls the corporation. If that person has no SSN or ITIN and cannot get one, enter "foreign" or N/A on line 7b (IRS: Form SS-4 instructions).
| Method | Who can use it | Timing |
|---|---|---|
| Phone, 267-941-1099 | International applicants only, 6 a.m. to 11 p.m. Eastern, Monday to Friday | Number given on the call |
| Fax, 304-707-9471 from outside the US (855-215-1627 from inside it) | Applicants with no US residence, office or place of business | Generally within 4 business days |
For mail filing, delays and later changes of responsible party, see EIN without an SSN. A founder does not need an ITIN for the corporation's EIN; ITIN for a foreign owner covers when one is needed.
Does the corporation have to register in another US state?
Only where it does business under that state's own test. Forming in Delaware does not register the corporation anywhere else, and activity such as an office, employees or inventory in another state can require registering and filing there. See Registering in another state.
What does a Delaware C corp file with the IRS in year one, even with no revenue?
Form 1120, whether or not it earned anything, plus a Form 5472 for each related party it had a reportable transaction with.
- Form 1120. Every domestic corporation not exempt under section 501 files, whether or not it has taxable income; check "Initial return" on the first one (IRS: Form 1120 instructions). It is due by the 15th day of the fourth month after year-end, counted from the end of a short first year if the first year is short. Form 7004 filed by then gives six months more to file, not to pay (IRS: Form 7004 instructions).
- Business and books kept abroad. A domestic corporation that transacts its business and keeps its books and records outside the US and Puerto Rico has until the 15th day of the sixth month after year-end to file and pay, with a statement attached, and can ask for four months more to file (IRS: Form 7004 instructions). Both conditions must hold; if unsure, file Form 1120 or Form 7004 by the regular due date.
- Schedule K, question 7. Answer Yes if one foreign person owned at least 25% of the vote or value, and give that owner's percentage and country and the number of Forms 5472 attached, even when none is due (IRS: Form 1120 instructions).
Does a dormant foreign-owned C corp file Form 5472?
Only if it had a reportable transaction with a related party, and a founder buying shares for cash is generally not one. Check first whether a founder lent the corporation money or paid any of its costs, such as the Delaware or agent fee; those dealings can make Form 5472 due. Each Form 5472 is attached to Form 1120 and due with it, including extensions (IRS: Form 5472 instructions).
The corporation is a reporting corporation if one foreign person owns at least 25% of its vote or value at any time in the year. It attaches a separate Form 5472 for each related party with which it had a reportable transaction (IRS: Form 5472 instructions).
| Founder dealing in year one | Form 5472 for a regular C corporation |
|---|---|
| Cash paid for newly issued shares, or extra capital paid in | Generally not reportable on its own: Part IV counts other amounts received only when they enter taxable income, and Part V, which covers formation costs and contributions, applies only to a foreign-owned disregarded entity, such as a single-owner LLC |
| Founder lends the corporation money | Reportable as amounts borrowed, including a loan still outstanding from an earlier year |
| Corporation pays the founder for services | Reportable |
Costs a founder pays for the corporation, repaid or not, and property such as code given for shares can also be reportable, depending on how they are recorded; see Putting money into your US corporation from abroad. A corporation on the accrual method reports amounts accrued, not only amounts paid. A founder with no US number is identified by a reference ID number the corporation assigns itself (IRS: Form 5472 instructions; 26 CFR 1.6038A-2). Failing to file a required Form 5472 costs $25,000, with more if the failure continues after IRS notice. When a dealing's treatment is unclear, settle it before the due date. For filling in the empty first return, see First corporate return with no revenue; for later years, Foreign-owned C corporation filing.
What does Delaware need by March 1 of the next year?
The annual report and franchise tax, by March 1 of the following year. A non-exempt domestic corporation also pays a $50 report fee (Division of Corporations). The first year's tax is prorated for the part of the year the corporation existed (8 Del. C. § 503(d)). The report names every director with an address and gives the principal place of business, which may be abroad but generally may not be the registered agent's address (8 Del. C. § 502(a)).
Before paying a large notice, file the report with the issued shares and gross assets so Delaware can compare both methods, and file it by March 1 of the following year: a late or incomplete report costs $200 even if the tax drops, and unpaid tax bears interest at 1.5% a month (Division of Corporations). Whether the corporation also owes Delaware income tax, and the yearly calendar after year one, are in Delaware C corporation taxes for startups.
Does a Delaware C corp file a BOI report?
No. Under FinCEN's final rule, every entity created in the US, and its beneficial owners, is exempt from beneficial ownership reporting, whoever the owners are or wherever they live. Only certain companies formed under a foreign country's law and registered to do business in a US state still report (FinCEN). See BOI report: who still files.
What do founders file in their own country?
That depends on the home country, which may tax or require reporting of your shares in a foreign corporation and of what the corporation pays you; get advice there before the corporation earns income. On the US side, dividends paid to a foreign shareholder are generally subject to US withholding (IRS: Publication 515); see Paying yourself as a foreign owner.
Example
These examples are illustrative; all figures are in US dollars and assume a calendar tax year.
One founder in Singapore
A founder in Singapore incorporates in March with 10,000,000 authorized shares at $0.00001 par. She buys 8,000,000 shares for $80 and pays in $20,000 more as capital. By year-end the corporation holds about $15,000 after setup costs and has no revenue.
- IRS: Form 1120, marked as the initial return, is due April 15 of the next year, or October 15 with Form 7004; June 15 instead if the corporation transacts its business and keeps its books outside the US. Schedule K question 7 shows a Singapore owner at 100%. The $80 and $20,000 paid for and into stock are generally not Part IV dealings, so if she lent nothing and paid none of its costs herself, no Form 5472 is due. Had the $20,000 been a loan, the corporation would attach Form 5472 showing the loan balance and any interest, and missing it would risk the $25,000 penalty. With no interest charged, a shareholder loan above $10,000 can create deemed interest under section 7872, and interest to a foreign owner is generally subject to US withholding (26 USC 7872; IRS: Publication 515).
- Delaware, by March 1 of the next year: for a full year, the authorized shares method gives $250 plus 999 blocks at $85, or $85,165. With $15,000 of assets and 8,000,000 issued shares, assumed par is about $0.0019 a share, assumed capital about $18,750, and the tax the $400 minimum. That tax is prorated from March, plus the $50 report fee.
Two co-founders in Germany and India
Two founders, one in Germany and one in India, each own 50%. Each is a 25% foreign shareholder, so the corporation is a reporting corporation and lists both in Part II of Form 5472. In year one the German founder lends the corporation $10,000, and the corporation pays the Indian founder $12,000 for software work. The corporation attaches two Forms 5472: one showing the loan, one showing the service payment. Pay for work done in India is generally not subject to US withholding (IRS: Publication 515). If both founders had only paid for their shares, Form 1120 would still be due, with no Form 5472.
A founder who ignored the first Delaware notice
A founder in Brazil whose corporation has 10,000,000 authorized shares receives a notice for $85,165 under the authorized shares method for a full year and sets it aside. In June she files the annual report with 9,000,000 issued shares and $50,000 of gross assets. Assumed par is about $0.0056 a share, assumed capital about $55,600, and the tax drops to the $400 minimum. The $50 fee is still due, and so are the $200 late penalty and interest of 1.5% a month on the unpaid tax, because the report missed March 1.
Different for you?
- You live abroad, or the founders live in different countries, and a first return is due even without revenue: get the setup, the share plan and the year-one Form 1120, Form 5472 and Delaware filings checked through business formation help.
- You live in the US: see Delaware C corporation for a startup.
- You are a US citizen or green-card holder living abroad: your shares generally do not make the corporation foreign-owned for Form 5472 (IRS: Form 5472 instructions); see Delaware C corporation for a startup for setup and cross-border tax help for your own return.
- You live in Canada or mainland China: see Forming a US corporation from Canada or US company for a China-resident founder.
- You have not chosen between an LLC and a corporation: see Forming and running a company from abroad.
- You will fund the company with a loan, or pay for shares with property: see Putting money into your US corporation from abroad.
- Your shares vest: see Founder shares that vest before the 30 days pass.
- Delaware sent a large franchise tax notice: see Delaware franchise tax.
- A Form 1120 or Form 5472 was missed: see Missed foreign-owner filings and penalties and get cross-border tax help.
- You want to pay yourself: see Paying yourself as a foreign owner.
Figures on this page
| Figure | Value | Source |
|---|---|---|
| Delaware entity name reservation fee Optional; holds a name for 120 days for domestic and foreign entities | $75 | Delaware Division of Corporations: Fee schedule, revised August 1, 2026 Checked |
| Delaware state filing fee for a domestic corporation's certificate of incorporation Column one of the Division fee schedule for a one-page certificate. Marked 'varies based on stock', so a larger share authorization raises it; add $9 for each additional page. Certified copies and same-day or 24-hour handling cost extra | $109 | Delaware Division of Corporations: Fee schedule, revised August 1, 2026 Checked |
| Regular Form 1120 filing deadline For C corporation tax years beginning in 2026 | 15th day of the fourth month after year-end Tax year 2026 | US Code: Section 6072(a) Checked |
| Delaware domestic corporation annual report and franchise tax due date Annual report and franchise tax for the prior calendar year; larger franchise-tax liabilities can require installments | March 1 of the following year | Delaware Division of Corporations: Annual Report and Tax Instructions Checked |
| Form 5472 penalty for failure to file or keep records For tax years beginning after December 31, 2017. Per reporting corporation, per tax year. A substantially incomplete Form 5472 counts as a failure to file. IRC 6038A(d)(1); Treas. Reg. 1.6038A-4(a). | $25,000 | IRS: Instructions for Form 5472 Checked |
| Delaware authorized shares tax, up to 5,000 shares Minimum tax under the authorized shares method | $175 | Delaware Division of Corporations: How to Calculate Franchise Taxes Checked |
| Delaware authorized shares tax, 5,001 to 10,000 shares Authorized shares method, before additional blocks | $250 | Delaware Division of Corporations: How to Calculate Franchise Taxes Checked |
| Delaware tax for each additional 10,000 authorized shares Each further block or portion after the first 10,000 shares | $85 | Delaware Division of Corporations: How to Calculate Franchise Taxes Checked |
| Delaware assumed par value tax per million of capital Per million or portion of a million; special proportional rule below one million and minimum tax apply | $400 | Delaware Division of Corporations: How to Calculate Franchise Taxes Checked |
| Delaware assumed par value method minimum tax Ordinary minimum under the assumed par value capital method | $400 | Delaware Division of Corporations: How to Calculate Franchise Taxes Checked |
| Delaware ordinary corporation franchise tax maximum Does not apply to a designated large corporate filer | $200,000 | Delaware Division of Corporations: Annual Report and Tax Information Checked |
| Automatic Form 7004 extension of time to file Form 1065, Form 1120-S or Form 1120 Generally six months from the regular due date; Form 7004 must be filed by the regular due date and does not extend time to pay. Different periods apply to some estates and trusts, to entities whose books are kept outside the United States, and to C corporations with a June 30 year-end whose tax year began before 2026. | Six months Tax year 2026 | IRS: Instructions for Form 7004 (revised December 2025) Checked |
| Filing and payment deadline for qualifying domestic corporation with foreign business and records Requires business and books of account outside the United States and Puerto Rico, plus a statement attached to the return | 15th day of the sixth month after year-end | IRS: Instructions for Form 7004, Part II line 4 Checked |
| Additional Form 7004 filing extension after foreign-records deadline For a qualifying domestic C corporation; does not further extend payment | Four months | IRS: Instructions for Form 7004, Part II line 4 Checked |
| Foreign ownership that makes a US corporation a Form 5472 reporting corporation At least this share of vote or value held by one foreign person, directly or indirectly, at any time in the tax year. A single-member LLC wholly owned by one foreign person is treated as such a corporation. | 25% | IRS: Instructions for Form 5472 Checked |
| Delaware non-exempt domestic corporation annual report fee Separate from franchise tax | $50 | Delaware Division of Corporations: Annual Report and Tax Information Checked |
| Delaware late corporate annual report penalty For not filing a complete annual franchise tax report on time | $200 | Delaware Division of Corporations: Annual Report and Tax Information Checked |
| Delaware monthly franchise and alternative entity tax interest Interest on unpaid corporation, LLC, and partnership tax and applicable penalties | 1.5% | Delaware Division of Corporations: Annual Report and Tax Information Checked |
Primary sources
- Delaware Division of Corporations: How to form a new business entity
- Delaware Division of Corporations: Fee schedule, revised August 1, 2026
- Delaware Division of Corporations: Annual Report and Tax Information
- Delaware Code: Title 8, chapter 1, subchapter I (formation)
- Delaware Code: Title 8, chapter 1, subchapter IV (directors and officers)
- Delaware Code: Title 8, chapter 1, subchapter V (stock)
- Delaware Code: Title 8, chapter 1, subchapter VII (stock ledger and records)
- Delaware Code: Title 8, chapter 1, subchapter XVIII (fees)
- Delaware Code: Title 8, chapter 5 (corporation franchise tax)
- IRS: Instructions for Form SS-4
- IRS: Instructions for Form 1120
- IRS: Instructions for Form 5472
- IRS: Instructions for Form 7004
- 26 CFR 1.6038A-2 (govinfo)
- US Code: 26 USC 83
- US Code: 26 USC 7872
- FinCEN: Beneficial Ownership Information Reporting
- IRS: Publication 515
About this guide
Published by Cloud Accounting under standing professional approval. This version has no separately recorded personal review. It explains general rules for the tax year shown. It is not advice for your situation.
Changes
- : First published.