Any corporation granted an exemption by the IRS as a non-profit organization under Section 501(c) is exempt from Delaware Corporate Income Tax.
Additionally, non-profit corporations are exempt from obtaining a Delaware business license and paying the accompanying gross receipts tax on the sales of most goods and services. Please note, however, that some services such as leasing tangible personal property or providing accommodations are taxable regardless of the tax status of the entity providing such services.
Non-profit corporations in Delaware are required to 1) register with the Division of Revenue and withhold Delaware State income taxes on employees performing services within Delaware, and 2) register with the Delaware Department of Labor. If the non-profit is a private foundation with activities conducted in the State of Delaware, it is also required to file a copy of Federal Form 990 PF with the Delaware Attorney General.
Non-profit organizations include, but are not limited to:
- Fraternal beneficiary societies,
- Orders or associations, cemetery corporations and corporations organized or trusts created for religious, charitable, scientific or educational purposes or for the prevention of cruelty to children or animals, home owner associations,
- Business leagues or organizations not organized for profit but operated exclusively for the promotion of social welfare, as well as clubs organized and operated exclusively for pleasure, recreation and other non-profit purposes.
The net profit of these organizations cannot benefit any private stockholder or member.