How to Pass the Annual Review After US Company Registration? Key Tips Revealed

How to Successfully Complete the Annual Review for a U.S. Company A Comprehensive Guide to Help You Stay Compliant

Registering a company in the United States is a crucial step for many entrepreneurs and business owners seeking to expand into international markets. However, the registration process is only the beginning. The real test lies in maintaining compliance through the annual review, a mandatory process that ensures a company continues to operate legally and maintains a good standing in the U.S. market. In recent years, with increasing regulatory scrutiny, many companies have faced penalties or even had their business licenses revoked due to missed or improperly completed annual reviews.

1. What is the U.S. Company Annual Review?

The U.S. company annual review-often referred to as the Annual Report or Annual Filing-involves submitting a report to the relevant state authorities each year to confirm that the company’s basic information remains accurate and up-to-date, and to pay the required annual fees. The exact name and requirements may vary by state. For example, in Delaware, it is known as the Annual Franchise Tax Report, while in California, it is called the Statement of Information.

Typically, the annual review includes

Confirmation of company registration details

Update of director and officer information

Verification or change of registered address

Payment of annual taxes or filing fees

Each state has its own deadlines, fees, and procedures. It is essential for companies to follow the specific rules of the state in which they were incorporated.

2. Why the Annual Review Matters

With increasing regulatory enforcement, compliance has become more critical than ever. According to a 2025 report by the U.S. Securities and Exchange Commission SEC, an increasing number of foreign companies have been marked as inactive-or even automatically dissolved-due to missed annual filing requirements.

Some states have also tightened enforcement. For instance, in 2025, California increased penalties for late filings and imposed stricter consequences for companies that fail to complete the annual review for two consecutive years. These developments highlight the serious legal and financial risks that businesses face if they neglect this essential compliance task.

3. Step-by-Step Guide to the Annual Review Process

While procedures may vary slightly by state, most annual reviews follow these general steps

1. Determine the Filing Deadline

Each state has its own schedule. Some require filings in the anniversary month of the company’s formation, while others, like California, set a fixed annual deadline e.g., during the first quarter. Companies should track these dates carefully to avoid missing them.

2. Update Company Information

During the review, companies must confirm or update key information, such as the registered address, list of directors and officers, and the company secretary. Any changes from the previous year must be accurately reflected.

3. Pay the Required Fees

Annual review fees vary significantly by state. For example

In Delaware, the annual fee is $50, plus an $800 franchise tax.

In California, the filing fee is $20, but an $800 annual tax is also required.

Some states impose late fees for overdue submissions, so timely payment is essential to avoid additional costs.

4. Submit the Annual Review

Most states offer online filing systems through their official websites. Some also allow filings to be submitted through registered agents, which is especially helpful for foreign businesses.

5. Keep Records of the Review

After completing the annual review, it is advisable to retain copies of all submitted documents and payment receipts. These records may be needed for future reference or in the event of an audit.

4. Common Issues and How to Address Them

1. Missed Deadline? What to Do

If a company misses the deadline, it should file as soon as possible and pay any applicable penalties. Most states offer a grace period, but prolonged delays may result in the company being marked as inactive or even dissolved.

2. Can You Skip the Review If the Company Isn’t Operating?

Even if a company is not actively operating, it is still required to complete the annual review and pay the associated taxes. Failure to do so may lead to compliance issues and complicate any future plans to resume operations.

3. Choosing a Reliable Registered Agent

For companies not based in the U.S., working with a trusted registered agent Registered Agent can simplify the annual review process. A good agent can assist with filings, receive legal documents, and provide timely reminders. It is recommended to choose an agent with a solid reputation, transparent service structure, and reasonable fees.

5. Leveraging Professional Services for Compliance Efficiency

As U.S.-China business interactions grow, more Chinese companies are establishing subsidiaries or branches in the U.S. However, differences in language, legal systems, and cultural practices often lead to confusion about compliance requirements like the annual review.

To address this challenge, many companies are turning to professional service providers. Companies like LegalZoom and Incfile offer annual filing services, while local accounting or law firms can provide customized support. Using such services not only ensures timely compliance but also offers added benefits such as tax planning and legal consultation, supporting long-term success in the U.S. market.

6. Conclusion

While the annual review process may seem complex, it is a manageable and essential part of maintaining a U.S. company. With proper planning, a clear understanding of requirements, and strategic use of external resources, businesses can easily stay compliant. The annual review is more than a legal obligation-it is a vital step in protecting a company’s reputation and ensuring uninterrupted operations. In today’s increasingly interconnected global economy, compliance is no longer optional; it is a fundamental requirement for any business aiming to thrive in international markets.

Whether you are a startup or an established enterprise, make sure to include the annual review in your annual business planning to ensure your U.S. company remains active, compliant, and ready for growth.