Delaware Just Raised the Rent: What the 2026 Entity Law Changes Mean for Your LLC or Corporation
By Hari Nathan Kalyan, Managing Attorney, Warren Kalyan.
Five Key Takeaways
Delaware's annual tax jumped 33 percent. House Bill 400 raises the LLC and LP annual tax from $300 to $400, retroactive to January 1, 2026, with most fee changes effective August 1, 2026.
Series and partnership fees rose too. Series LLC and series LP registration fees went from $75 to $100, and LLP per partner fees rose from $200 to $300.
One time service fees jumped sharply. Service of process fees doubled, and a rush filing can now run up to $10,000.
The statutes changed too, effective August 1, 2026. New amendments tighten dissolution, registered agent, and series LLC and LP rules.
Texas is a credible alternative for smaller companies. No annual LLC tax and a roughly $2.5 million no tax due franchise threshold change the math for founders without a Delaware specific need.
If your business is a Delaware LLC or corporation, your annual bill just went up. On May 21, 2026, Delaware's governor signed House Bill 400, a sweeping update to the fees the Delaware Secretary of State charges every entity on its books. The annual tax increases apply retroactively to January 1, 2026, and most of the filing fee changes took effect on August 1, 2026. Delaware also passed its usual summer round of substantive amendments to its corporation, LLC, and limited partnership statutes, all effective August 1, 2026.
For a Fortune 500 company, these numbers are a rounding error. For a founder running a two million dollar business who formed in Delaware because a startup blog said to, they are one more line item, and a good prompt to ask a question we hear often: does Delaware still make sense for us?
What Changed on the Fee Side
House Bill 400 touches nearly every recurring charge a Delaware entity pays. The annual tax for Delaware LLCs and limited partnerships rises from $300 to $400, a 33 percent increase. The fee for each registered series of a series LLC or series LP goes from $75 to $100. Limited liability partnerships now pay $300 per partner, up from $200, with the annual cap rising to $180,000.
One time charges climbed too. The fee for the Secretary of State to accept service of process doubled from $50 to $100. Document preclearance went from $250 to $350. Expedited filings got noticeably pricier; a 30 minute rush filing can now run up to $10,000, and even same day service can cost up to $500. Foreign corporations registered to do business in Delaware saw their annual report fee double from $125 to $250.
None of these numbers will bankrupt anyone. But they compound. A Texas based business that operates through a Delaware LLC pays the new $400 Delaware annual tax, a Delaware registered agent fee that typically runs $100 to $300 per year, and Texas foreign registration costs on top of that, all to be governed by the law of a state where it has no office, no employees, and no customers.
What Changed in the Statutes
Alongside the fee bill, Delaware enacted House Bills 353, 352, and 354, its annual amendments to the General Corporation Law, the LLC Act, and the limited partnership statute. The headline items this year are procedural but worth knowing. Dissolving corporations must now agree in their certificate of dissolution to accept service of process through the Secretary of State, and a registered agent's responsibilities now terminate when the dissolution filing becomes effective. The amendments also clarify voting standards when a certificate of incorporation opts out of class votes on share authorization changes, and they tighten up the rules for series LLCs and series LPs, including how to correct records when a general partner departs.
These are housekeeping changes, not upheaval. But they are a reminder that Delaware earns its reputation by constantly maintaining its statutes, and that maintenance is now being funded by higher charges on every entity in the system.
Why This Matters for Smaller Companies
The Delaware question has changed a lot in two years. Texas has been openly competing for entity formations. The 2025 amendments to the Texas Business Organizations Code under Senate Bill 29 codified the business judgment rule for Texas corporations, tightened the rules for shareholder litigation, and let companies channel governance disputes into the Texas Business Court. Commentators now talk about a DExit trend, with companies converting out of Delaware and into states like Texas and Nevada.
Cost is part of that story, and here the contrast is real. Texas imposes no annual entity maintenance tax on an LLC. Texas franchise tax applies only above a no tax due threshold of roughly $2.5 million in annual revenue, which means a large share of small businesses owe nothing year to year. A Texas business operating through a Texas LLC files with one state, pays one set of fees, and litigates governance disputes close to home.
That does not make Delaware the wrong answer for everyone. Delaware still offers the deepest body of corporate case law in the country, the Court of Chancery, and familiarity that matters to institutional investors. If you are raising venture capital, planning for private equity investment, or building toward a sale to a buyer who will insist on a Delaware entity, forming there, or staying there, can be worth every dollar. The point is that it should be a decision, not a default.
Practical Takeaways
Budget for the increase. If you keep a Delaware LLC or LP, expect the $400 annual tax on your June 1, 2027 bill, and remember the increase is retroactive to January 1, 2026.
Audit what Delaware is doing for you. If your Delaware entity operates entirely in Texas, has no outside investors, and has no exit on the horizon that requires Delaware, you may be paying two states for the privilege of using one.
Know that leaving is straightforward when it is the right call. Both Delaware and Texas permit statutory conversion, which lets an entity change its home state while keeping the same EIN, contracts, and history; it requires approvals under the company agreement, filings in both states, and attention to tax and lender consent issues, but it is a well worn path.
If you stay in Delaware, use the moment to confirm your registered agent information, your good standing status, and, for series structures, that your series filings match the amended statutes.
If you are forming something new, run the choice of entity and choice of state analysis on the facts you actually have, your investors, your industry, your growth plans, and your appetite for out of state compliance, rather than on habit.
The Bottom Line
Delaware remains an excellent formation state for companies that need what it uniquely offers. It is also now a more expensive one, at the exact moment Texas has made itself a more credible alternative for closely held businesses. For founders and owners of smaller companies, the 2026 changes are less a crisis than an invitation to look at the question fresh.
Our team at Warren Kalyan regularly advises founders and closely held companies on choice of entity, formation state, and conversions between Delaware and Texas, and we handle the governance documents that make those structures work.
Weighing whether Delaware still makes sense for your business?
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General information only, not legal advice for your specific situation.