Delaware Small Business Grants

Small Business and Startups in Delaware

There are more than 30.7 million small businesses in the US with Delaware being home to 84,675 small businesses including 1,909 small business exporters. There are several thriving industries in the state that present opportunities for startups including the finance sector (a backbone sector), fishing industry (contributes approx. $34 million), agriculture industry (worth $8 billion), manufacturing sector (2nd largest traded sector), Tourism (generates $500 million in taxes), construction industry (fastest growing), and retail trade among others. If you are thinking of starting a new Delaware business or relocating an existing business then small business grants in Delaware can play a key role in helping you achieve certain business objectives. The state offers several types of grants including EDGE grant in Delaware and other business incentives that make the state an attractive place for entrepreneurs.

Why do small businesses or startups prefer Delaware?

The state of Delaware is considered as one of the best destinations for incorporating a new business. In 2019, the economy of Delaware grew at an annual rate of 2.3 percent, which was faster than the overall US growth rate of 2.1 percent. The state offers several business incentive programs including small business grants in Delaware and provides startups with a competitive business climate, robust infrastructure, a diverse workforce, and a good location. The state is considered as a favorite by first time entrepreneurs, family-based businesses, and even Fortune 500 companies. You can also start a business in this state and take advantage of several incentive programs the state offers including Delaware small business relief grants that will minimize your overall startup costs. Some of the top advantages are:

• Tax Benefits for small businesses: One of the top benefits apart from a Delaware startup grant is the tax benefits that companies can derive. The state doesn’t tax business entities that operate outside of its borders, which means that if there is no physical office in the state if you are not doing business directly within Delaware then state taxes will not be applicable. Additionally, businesses can also benefit from the following:
  • There is no state sales tax
  • There is a very low gross receipts tax applicable only in certain situations. This tax will be applicable if you are doing business in the state.
  • There is no corporate tax applicable on interest or any other investment income in a Delaware holding company.
  • There are no state level taxes on equity investment or fixed-income gains
  • There is no business or personal property tax.
  • You may have to file estate tax at the county level and it is fairly low
  • There is no inventory tax, use tax, or value-added tax in the state
  • There is no tax on capital shares or stock transfer and is considered to be beneficial for startups trying to obtain Delaware startup grant or venture funding
  • There are no state based taxes on intangible assets like patents, trademarks, and naming rights.
• Business Friendly Judicial System: One of the salient aspects of new business formation in Delaware is the highly respected and well-established judicial system also known as Delaware’s Court of Chancery. The court specializes in handling and resolving a variety of corporate issues by using judges instead of a jury. It also examines issues related to commercial litigation and real property. It is also a known fact that the Delaware business laws are more favorable to business entities as compared to most other states. If you plan to register in Delaware then you can be rest assured that there is a robust legal system that will provide the protection your business requires.
• Privacy and Flexibility: One of the top advantages for companies in Delaware is the privacy and flexibility that they can enjoy. Business corporations can take advantage of the terms of Delaware’s corporate statutes, which imply that there is flexibility regarding the structure of your corporation as well as board members like shareholders or directors of the company are not required to be residents of the state. Since, corporations are not required to disclose the name of the director or officer in the registration documents, such businesses enjoy a lot of privacy as well.
• Small Business Development and Incentive Programs: Whatever the type of business you form in Delaware, there are several state-based business incentive programs you can benefit from. These programs can vary from tax credit programs like angel investor tax credit programs to small business grants Delaware programs including the EDGE grant in Delaware. There are several other programs like the Brownfield Assistance Program, Workforce Training Grant, Delaware Capital Access Program, Delaware Technical Innovation Program, New Business Facility Corporate Income Credit Program, Research and Development Tax Credit, and Delaware New Jobs Infrastructure Fund among others.

Delaware Division of Small Business Grants

A Delaware startup grant also known as a small business grant usually refers to a small amount of seed money that is provided to an individual or entrepreneur, or business entity by the federal, state, county or local governments, and even private companies. The grants are quite popular amongst new businesses as they present an attractive financial consideration, which can help promote growth or expansion. Unlike a loan, a grant is not required to be repaid. The Delaware small business relief grants can be obtained by different types of businesses including women owned businesses, online entities, veteran owned startups etc. The key lies in searching for, and identifying the grants that your business will qualify for and then applying for the same. Let us take a look at some of the top grant programs in the state.

EDGE Grants

As a business, you may qualify for a variety of small business grants and one of them is the EDGE grant in Delaware. The EDGE grants are awarded by the Division of Small Business using a competitive selection process. The eligibility for this grant depends on the following:

• The said business has been operational for less than 5 years
• The business has employed less than 10 people
• It is located in Delaware
• It has never received a Strat Fund grant

The EDGE Delaware startup grant application takes into consideration several criteria including location of the business (Opportunity Zones), MWVBE (Minority, Women, Veteran-Owned Business Enterprises) status, Business viability, Business need, and Competitive advantage among others. A STEM-based company can receive a maximum of $100,000 for eligible expenses through the EDGE grant in Delaware while an Entrepreneur Class (non-STEM) business can be awarded a maximum of $50,000.

It is important to note that a non-Delaware company may also be able to apply for the EDGE small business grants in Delaware if it relocates a minimum of 51 percent of its business. A sole proprietorship business can also apply for this grant.

DE Relief Grants

The Delaware small business relief grants (DE Relief Grants) is a joint effort between the State of Delaware and New Castle County to assist small businesses as well as nonprofits that have borne the impact of the COVID-19 pandemic. The funds of this small business grants in Delaware program are made available from the federal CARES Act. The eligibility rules imply that a business must meet the U.S. Small Business Administration’s definition while a nonprofit is eligible if it is a registered 501(c)(6) or 501(c)(3) organization.

It is important to note that you can apply for the small business grants in Delaware, if 51 percent of your business is based in Delaware. You can also apply even if you have received grants like EDGE grant in Delaware, HELP, or DTIP grants previously. You will be required to apply for this grant online when the funding period opens.

Incentive and Credits Programs

Although a Delaware startup grant is one of the top beneficial programs for any small business in the state, there are several other types of incentive and credits programs that businesses can benefit from. There is a long list of programs but the most popular and beneficial programs for new and existing small businesses are:

Tax Credit Programs

Depending on the type of business you form, the location, the product or service offered and the business requirement; there are several different tax credit programs, you may qualify for. The tax credits are primarily administered by the Delaware Division of Revenue against the personal or corporate income tax, public utility tax, and gross receipts tax, among others. Some of the top tax credit programs include:

• New Economy Jobs Tax Credit
• New Business Facility Tax Credits
• Public Utility Tax Credit
• Gross Receipts Tax Credit
• Brownfields Credit
• Clean Energy Technology Device Manufacturers’ Credit
• Angel Investor Job Creation and Innovation Tax Credit
• Business Finder’s Fee Tax Credit
• Research and Development Tax Credits
• Neighborhood Assistance Tax Credit
• Individuals with Disabilities Tax Credit

Funds and Grant Programs

The funds and grants programs are an essential component of the business incentive program in Delaware and the objective is to ensure the startups or small businesses costs of business formation and operation is minimized. There are several different types of Delaware startup grant and funding programs that you can choose from including the Delaware division of small business relief grants. The programs are:

• Transportation Infrastructure Investment Fund(TIIF)
• Delaware New Jobs Infrastructure Fund
• Workforce Training Grant Application

Do you want to start your new company in Delaware?

Other Recent Funding Opportunities Published in the Local State

Small business grants in Delaware are not just offered by government bodies and state agencies but also by private institutions and county or local agencies. The state of Delaware has created funding opportunities for small businesses as well as existing businesses based on business need and the impact of the covid pandemic on businesses. The Delaware small business relief grants published in the local state focuses on women entrepreneurs, individual business owners, construction projects, education, social and economic empowerment projects, and much more. Some of the statewide and local county based funding opportunities are:

• Fund for Women
• Youth Success Grants
• Leadership in Community focus grant
• Highmark BCBSD BluePrints for the Community Small Grants
• Highmark BCBSD BluePrints for the Community Standard Grants
• Capital Project Grants
• COVID-19 Strategic Response Fund: Community Needs Grants
• African American Empowerment Fund of Delaware
• The Next Generation – Northern Delaware
• Caesar Rodney Rotary Foundation (CRRF) New Castle County Youth Empowerment Fund
• Specific Interest Grants
• Potter Charitable Trust
• Delaware Nonprofit Support Fund (CARES)

Ready to Start a Business in Delaware?

Each business has its own set of requirements and objectives and the fulfillment of the same can be cost intensive. This is where a Delaware startup grant can be quite beneficial as it will help you to minimize the cost of setting up your business as well as lower your expenses post business formation. You can apply for Delaware small business relief grants only after you have registered your new business in the state and IncParadise can help you with the process of incorporation or formation.

IncParadise is an expert incorporation service provider in Delaware and we can not only help you to start your small business in Delaware but also provide meaningful assistance with all your annual filings. We provide a wide variety of additional services that cater to different types of business requirements right from filing of Delaware Annual Franchise Tax Report to help obtain Tax ID/EIN, foreign qualification, and Certificate of Good Standing among others.