Delaware Guide for Canadians

Quick Facts

State Income Tax	Progressive 2.2% to 6.6%
Sales Tax	No state sales tax
Driver's License Grace Period	60 days for residents
Residency Requirement for Tax	Delaware domicile or statutory residency
Vehicle Registration Deadline	60 days after establishing residency
REAL ID Deadline	May 7, 2025 for domestic flights
Enhanced Driver's License	Not available

First 90 Days Checklist

Week 1-2: Essential Documents & Registration

• Register with USCIS if staying 30+ days (required by April 11, 2025)
• Gather required documents for driver's license
• Open US bank account
• Set up Delaware mailing address

Week 3-4: Official Registration

• Apply for Delaware driver's license (within 60 days)
• Complete knowledge test, vision screening, and road test
• Begin vehicle registration process (within 60 days)
• Register to vote (if eligible)

Month 2-3: Establishing Residency

• Update address with Canadian financial institutions
• Complete vehicle registration and titling
• Establish Delaware ties and connections
• Research healthcare options and insurance

Driver's License & Vehicle Requirements

For Canadian Citizens

Required Documents:

• Valid unexpired foreign passport with valid U.S. entry marking
• Birth certificate with certified English translation
• Two proofs of Delaware residency with current address
• USCIS/DHS current documents and approval forms

Testing Requirements:

• Knowledge test required for all new applicants
• Vision screening required (20/40 or better)
• Road skills test required - Delaware does not accept foreign licenses
• SAVE verification required for all non-U.S. citizens

REAL ID Option:

• Available for qualifying non-citizens with proper documentation
• Required for domestic air travel after May 7, 2025
• Enhanced Driver's License not available in Delaware
• Passport required for international travel

Important Notes:

• 60-day limit to get Delaware license after establishing residency
• SAVE verification process may delay issuance
• Must present original documents - no copies accepted
• Additional documentation may be required for certain visa classifications

Vehicle Registration

• Register within 60 days of establishing residency
• Must obtain Delaware title before registration
• Registration fees based on vehicle age and value
• Delaware insurance required for registration
• Annual registration renewal required

Tax & Residency Considerations

Delaware State Tax Structure

• **Progressive income tax** rates from 2.2% to 6.6%
• **No state sales tax** - major advantage for consumers
• **Low property taxes** (average effective rate around 0.48%)
• **No inheritance tax** on estates
• **Corporate haven** with business-friendly environment and favorable incorporation laws

Establishing Delaware Tax Residency

Delaware residency is based on domicile or statutory presence:

• Domiciled in Delaware (intent to make permanent home)
• Statutory resident rules apply for tax purposes
• Delaware driver's license and voter registration help establish domicile
• Standard deduction: $3,250 single, $6,500 married filing jointly

Documentation to Establish Residency

• Delaware driver's license and voter registration
• Bank accounts and utility bills in Delaware
• Employment or business activities in Delaware
• Property ownership or long-term lease agreements
• Professional licenses and club memberships

Tax Benefits

Delaware offers no sales tax, low property taxes, and moderate income tax rates. The state is famous for its business-friendly corporate laws and serves as the incorporation home for many Fortune 500 companies.

Income Tax Reality

Unlike true no-tax states, Delaware does have a progressive income tax system with rates up to 6.6%. However, the lack of sales tax can offset this for many consumers, especially those with significant purchases.

US Federal Tax Implications for Canadians

Important: Under the Substantial Presence Test, you may be considered a U.S. resident for tax purposes.
New Requirement: Canadians staying 30+ days must register with USCIS by April 11, 2025.
Recommendation: Consult a cross-border tax professional.

Healthcare Considerations

Insurance Options

• Delaware has expanded Medicaid with broader eligibility
• Travel insurance strongly recommended for temporary residents
• Consider US health insurance if staying permanently
• Quality medical facilities in Wilmington, Dover, and Newark

Prescription Medications

• Bring adequate supply from Canada
• Understand prescription transfer requirements
• US prices often higher than Canadian prices
• Good pharmacy coverage throughout the state

Healthcare Access

• Excellent healthcare facilities for a small state
• Close proximity to major medical centers in Philadelphia and Baltimore
• ChristianaCare and Bayhealth are major health systems
• Good specialist availability despite small size

Special Considerations for Snowbirds

New US Registration Requirements (2025)

• Canadians staying 30+ days must register with USCIS
• Registration required by April 11, 2025
• Print and carry latest I-94 as proof of legal entry
• Failure to register may affect future US travel

Maintaining Canadian Ties

• Keep principal residence in Canada
• Monitor days in U.S. for tax reasons (183-day rule)
• Maintain Canadian insurance & banking relationships
• Delaware's compact size makes it easy to establish ties

Property Considerations

• Beach property commands premium prices
• Very low property tax rates throughout the state
• Various local tax exemptions available
• Impact on Canada's principal residence exemption

Climate & Lifestyle Factors

• Moderate four-season climate with mild winters
• Coastal location provides beaches and water activities
• Close proximity to major East Coast cities
• Small state size means short travel distances

Geographic Advantages

• Strategic location between New York and Washington DC
• Easy access to major airports (Philadelphia, Baltimore, DC)
• No direct border with Canada - nearest crossing in New York
• Excellent highway access via I-95 corridor

Travel Documentation

• Ensure passport validity (6+ months remaining)
• Consider Global Entry/NEXUS for easier border crossings
• Enhanced Driver's License not available in Delaware
• I-94 registration now required for 30+ day stays

East Coast Convenience

Delaware offers the perfect blend of no sales tax, beach access, and proximity to major East Coast cities. The small state size means you're never far from amenities, and the business-friendly environment attracts many professionals.

Limited Space & High Costs

As one of the smallest states, Delaware has limited housing inventory, especially in desirable coastal areas. Beach properties can be expensive, and the state's small size means fewer choices for rural living.

Key Contacts & Resources