LLC Cost (Awesome Review On LLC Formation Costs)

LLC Cost

Looking for an awesome review of the subject: LLC Cost!

How much does it cost to start an LLC?

What are the LLC costs by state?

You should look no more, we’ve got you covered!

In this article, we will go over the various costs you can expect to form an LLC and start running a limited liability company.

We will look at the different LLC costs, the initial cost of an LLC, the yearly LLC fees, we’ll provide you with a few examples and provide you with a summary table providing you all the LLC cost by state.

Are you ready to get started!

Let’s jump right in.

LLC Costs: Overview

To start our analysis, it is useful to give you a breakdown of all the different types of costs to form an LLC.

Then, we’ll break down each cost component.

Here are some typical LLC startup costs:

  1. LLC state filing fees
  2. LLC name reservation fees
  3. LLC fictitious name application fees
  4. LLC publication fees
  5. LLC business license fees
  6. LLC expedited processing fees
  7. LLC foreign business registration
  8. LLC non-recurring costs 
  9. LLC service fees
  10. LLC franchise tax
  11. LLC annual report fees
  12. LLC registered agent fees
  13. LLC business license renewal fees 

Some of these fees are one-time fees and others are yearly fees or ongoing basis.

Keep reading as we’ll provide you with all the details you need on these fees.

For now, this list gives you a good mental note of the different fees you can expect to do business as an LLC.

In the next section, we will cover the one-time costs you’ll need to initially assume when registering your LLC.

Initial cost of an LLC

There are some costs when forming an LLC.

How much does it cost to set up an LLC?

The setup costs are generally paid on a one-time basis to the Secretary of State or corporate registry office.

These are costs that you’ll need to assume initially for the LLC formation only.

The cost of an LLC in the United States is composed of:

  1. LLC state filing fees
  2. LLC name reservation fees
  3. LLC fictitious name application fees
  4. LLC publication fees
  5. LLC business license fees
  6. LLC expedited processing fees
  7. LLC foreign business registration
  8. LLC non-recurring costs 
  9. LLC service fees

The costs of an LLC will vary depending on the state but the state filing fees, publication fees and name reservation fees could be some fees that you may be expected to assume.

Let’s look at each in more detail.

LLC state filing fees

The state filing fees represent the cost you must pay the state or the LLC registration authorities to file your articles of organization.

You may also hear the terms “certificate of formation” or “certificate of organization” when referring to an LLC’s articles of organization.

The state filing fees can range between $40 to $520 depending on where you are forming your LLC.

LLC name reservation fees

Another LLC startup cost to consider is the name reservation fees. 

Operating an LLC requires you to have a unique name that does not conflict with another LLC, corporation or registered legal entity.

It’s generally good practice to perform a name search and reserve the name that works for you.

In most states, reserving the name is optional, so you don’t have an obligation to do so.

However, in Alabama, it is mandatory to reserve your LLC name.

The name reservations costs can range between $10 to $50 depending on your state.

LLC fictitious name application fees

It’s not mandatory to file for a fictitious name or DBA (“doing business as”) for your LLC if you will operate your LLC strictly under its officially registered name.

However, if you want your LLC to operate under a different name (like a “nickname”), you can consider filing an application to register a fictitious name.

Depending on your state, the costs of filing for a DBA under an LLC can vary between $5 to $100.

Some states may also require that you publish a notice in the newspaper (LLC publication fees) that can add to your DBA costs.

You should also take note that in some states, you will need to pay one DBA filing fee with your state agency and in some other states, you’ll need to pay at the county level.

LLC publication fees

A few states, in addition to your LLC filing fees, will require that you publish a statement of formation in a local newspaper.

In the following states, you are expected to publish a statement of formation: 

  1. Arizona
  2. Nebraska
  3. New York

The cost of publication can go from $50 to $2,000.

The costs can go up pretty fast depending on the requirements you need to meet for the state.

LLC business license fees

Your LLC may need a business license fee to operate its business depending on your state.

The business license is issued either by your city or county.

The costs to obtain a business license can vary by state.

You can expect something along the lines of $50 to $100.

LLC expedited processing fees

You can request that your state process the registration of your LLC by paying an expedited processing fee.

You should verify with your state to see how much they charge to quickly process your application.

This can be useful if you urgently need to sign a contract with a prospect and you want to ensure your LLC is legally formed.

For example, expedited service fees in Delaware are as follows:

  1. Next day service: $50 to $100 
  2. Same day service: $100 to $200
  3. Two-hour service: $500
  4. One hour service: $1,000

Generally, the prices can range from $50 to $1,500.

LLC foreign business registration 

If your LLC is going to do business in a state other than where it was registered, you will need to register your LLC with all the other states where your LLC conducts business.

To do business in multiple states, you must factor the additional costs of paying the filing fees associated with each state where your LLC operates.

Generally, the foreign business registration fees will be the same as a local LLC but some states may charge a slightly higher fee.

For example, if you intend on conducting your LLC business in the state of California, you must register as a foreign LLC.

To do that, you’ll need to complete Form LLC-5 called the Application to Register a Foreign Limited Liability Company

This will cost you $70.

They can range between $40 to $600.

LLC non-recurring costs 

There are instances where you’ll need to assume certain non-recurring costs associated with your LLC.

For example, if you need to amend your articles of organization during the life of your LLC, you’ll need to pay an amendment fee.

In case you are merging your LLC with another entity, you may incur some costs associated with that event.

We will not go deeper into non-recurring LLC costs as they are not as common.

LLC service fees 

Some will handle the LLC formation by themselves.

In that case, you will not assume any additional fees related to the formation of your LLC.

In some other cases, you may want to hire a business lawyer or professional to handle the LLC formation for you. 

The costs to hire a lawyer can range from $500 to $1,000 depending on the lawyers you choose for a standard LLC formation.

The costs can go higher if there are legal complexities in your LLC formation.

Some companies offer online LLC registration services for a fixed fee as an alternative to hiring a lawyer.

If you are looking to have someone handle the LLC establishment for you, you should contact a few lawyers or online service providers and compare their prices.

Yearly LLC Cost

Now that you know how much it can cost you to set up your LLC, let’s dig deeper into the recurring LLC cost variables.

The question is: how much does an LLC cost yearly?

Once you legally create your LLC, you’ll need to budget for the recurring costs to maintain your LLC in good standing with your state.

Generally, you can consider the following yearly LLC cost factors:

  1. LLC franchise tax
  2. LLC annual report fees
  3. LLC registered agent fees
  4. LLC business license renewal fees 

Let’s look at each of these annual LLC costs.

LLC franchise tax

Depending on where your LLC was formed, you may need to pay a franchise fee or annual LLC taxes to your state.

The franchise fee or franchise taxes are a minimum set amount your LLC is required to pay on a yearly basis.

The costs of an LLC minimum tax can range between $100 to $800

For example, California has a Franchise Tax of $800 payable on a yearly basis. 

LLC annual report fees

In some states, you will need to file an LLC annual report either every year (annual report) or every two years (biennial report).

When filing your periodic report, you’ll need to pay the associated state fees.

Your annual or biennial statement of information costs can range between $20 to $100.

Keep in mind that if your LLC is registered in multiple states, it must factor in the annual or biennial filing fees for each state in which the LLC registration must be maintained.

LLC registered agent fees

When registering an LLC, you are required to designate a registered agent who is a third party authorized to receive and accept legal papers on behalf of the LLC.

Your LLC is required to appoint someone to receive legal documents in case of a lawsuit and it cannot designate itself as such.

Your LLC can appoint anyone who is over the age of 18 or a company such as: 

  1. An employee of your LLC
  2. A representative of your LLC like a lawyer
  3. A spouse
  4. A relative 
  5. A friend
  6. A registered agent company

If you choose to hire a registered agent company to act as your LLC’s registered agent, you can expect annual charges between $100 to $400.

LLC business license renewal fees 

Another recurring fee to potentially assume is your LLC business license renewal fees.

The business license fees are payable on a yearly basis and can range between $20 to $100.

Types of LLC costs

To start an LLC, you’ll need to be mindful of two types of LLC costs:

  1. Formation costs 
  2. Ongoing costs

Let’s do a quick review.

LLC formation costs

Formation costs are costs that you’ll need to assume when setting up your LLC or when you are forming it.

For example, to legally create your LLC, you must file your LLC’s articles of organization, also known as “certificate of organization”, in the state you are intending to establish your LLC.

Another example is your name reservation fees.

When you register your LLC, you may want to reserve your name with your Secretary of State to ensure that your name does not conflict with another LLC or registered entity.

If you do so, you’ll pay the name reservation fees only once.

LLC ongoing costs

The second category of LLC costs is the fees payable on an ongoing basis.

These are fees you need to pay on a regular basis to keep your LLC operational and in good standing with your state.

For example, the LLC’s must pay an annual report fee or biennial report fee.

The objective of the annual report is to ensure that you keep your LLC’s registered information up-to-date.

Every time you file your annual report or biennial report, you’ll need to pay the filing costs.

LLC set up cost examples

Now that we’ve covered the different types of costs to start an LLC, let’s look at a few LLC set up cost examples so you can see how it works.

Example 1: California LLC fee

To form an LLC in California, here are the fees you’ll need to consider:

  1. California LLC formation cost: $75
  2. California state franchise tax: $800
  3. California Statement of Information fees: $20
  4. California registered agent fees: $50 to $500
  5. California annual franchise tax: $800
  6. California biennial Statement of Information or Statement of No Change fee: $20

Total initial set up costs: $895 

Total recurring costs: $850 to $2,170

Example 2: Delaware LLC fee

To form an LLC in Delaware, here are the fees you’ll need to consider:

  1. Delaware LLC formation cost: $110
  2. Delaware state franchise tax: $300
  3. Delaware registered agent fees: $50 to $500
  4. Delaware annual franchise tax: $300

Total initial set up costs: $410 

Total recurring costs: $350 to $800

Example 3: New York LLC fee

To form an LLC in New York, here are the fees you’ll need to consider:

  1. New York LLC formation cost: $205
  2. New Your publication fees: $200 to $2,000
  3. New York certificate of publication: $50
  4. New York annual filing fee: $25 to $4,500
  5. New York biennial statement: $9

Total initial set up costs: $455 to $2,255

Total recurring costs: $34 – $4,534

Summary of LLC costs

Let’s recap the cost to start an LLC:

FEESCOST RANGE
State filing fees$40 to $520
Name reservation fees$10 to $50
Fictitious name application fees$5 to $100
Publication fees$50 to $2,000
Business license fees$50 to $100
Expedited processing fees$50 to $2,000
Foreign business registration$40 to $520
Non-recurring costsVaries based on need
Service fees (lawyer, online)$500 to $1,000
Annual franchise tax$100 to $800
Annual filing fees$20 to $100
Annual registered agent fees$100 to $400
Annual business license renewal fees$20 to $100

LLC cost by state

Here is a quick summary of the LLC cost by state:

StateLLC Filing CostLLC Ongoing Cost
Alabama$212$100 (Annual Privilege License)
Alaska$250$200 (Biennial)
Arizona$85$0 (No Annual Costs)
Arkansas$50$150 (Annual)
California$75$800 (Annual Franchise Tax)$20 (Biennial)
Colorado$50$10 (Annual)
Connecticut$120$20 (Annual)
Delaware$110$300 (Annual Franchise Tax)
District of Columbia (D.C.)$220$300 (Biennial)
Florida$125$138.75 (Annual)
Georgia$100$50 (Annual)
Hawaii$50$15 (Annual)
Idaho$100$0 (No Annual Costs)
Illinois$154$75 (Annual)
Indiana$98$30 (Biennial)
Iowa$50$45 (Biennial)
Kansas$160$50 (Annual)
Kentucky$40$15 (Annual)
Louisiana$105$35 (Annual)
Maine$175$85 (Annual)
Maryland$197$300 (Annual)
Massachusetts$520$500 (Annual)
Michigan$50$25 (Annual)
Minnesota$155$0 (No Annual Costs)
Mississippi$53$0 (No Annual Costs)
Missouri$52$0 (No Annual Costs)
Montana$70$20 (Annual)
Nebraska$109$10 (Biennial)
Nevada$425$350 (Annual)
New Hampshire$102$100 (Annual)
New Jersey$130$75 (Annual)
New Mexico$50$0 (No Annual Costs)
New York$205$9 (Biennial)
North Carolina$127$200 (Annual)
North Dakota$137$50 (Annual)
Ohio$99$0 (No Annual Costs)
Oklahoma$104$25 (Annual)
Oregon$100$100 (Annual)
Pennsylvania$125$0 (No Annual Costs)
Rhode Island$156$50 (Annual)
South Carolina$150$0 (No Annual Costs)
South Dakota$150$50 (Annual)
Tennessee$308$300 (Annual)
Texas$300$0 (No Annual Costs)
Utah$76$20 (Annual)
Vermont$125$35 (Annual)
Virginia$100$50 (Annual)
Washington$200$300 (Biennial)
West Virginia$125$25 (Annual)
Wisconsin$130$25 (Annual)
Wyoming$102$50 (Annual)

LLC Cost FAQ's

LLC Cost FAQ’s

How much does an LLC cost yearly?

Depending on the state where you will register your LLC, you may have to pay different yearly fees.

The typical yearly costs are the following:

  1. LLC franchise tax
  2. LLC annual report fees
  3. LLC registered agent fees
  4. LLC business license renewal fees 

In some cases, your state may charge a recurring fee every two years.  

For example, in the state of California, you will need to file a Statement of Information or a Statement of No Change on a biennial basis at a cost of $20.

How much does it cost to set up an LLC?

To set up an LLC, you must consider to categories of charges:

  1. Formation costs
  2. Ongoing annual costs

Formation costs are charges that you’ll need to assume when setting up your LLC or when you are forming it.

Ongoing annual costs are fees you need to pay on a regular basis to keep your LLC operational and in good standing with your state.

How much is an LLC license?

In some states, you may need to file for a business license through your city or county.

The costs to obtain a business license can vary by state.

You can expect something along the lines of $50 to $100.

How much money do you need to start an LLC?

It’s important to do your research to better understand the cost of an LLC.

The costs can vary depending on where you must register your limited liability company.

Also, if you work with a lawyer, online service company or a registered agent company, those costs will add to your overall budget.

If you were to handle the LLC yourself, your cost of LLC can hover between $350 to $2,500.

These are very high-level numbers.

The reason why there can be a big discrepancy in the cost to form an LLC is due to factors like publication fees in the newspaper.

For example, if your LLC filing cost in Delaware is $350 but in New York, the cost of starting an LLC can go up to $2,255 as you must publish a notice in the newspaper and depending on your region, those costs can be very expensive.

Do LLCs have annual fees?

Yes, LLCs have to pay annual fees.

After you open your LLC, you need to account for a budget to keep your LLC in good standing by paying the annual recurring fees to the state.

Generally, you can consider the following yearly LLC cost factors:

  1. LLC franchise tax
  2. LLC annual report fees
  3. LLC registered agent fees
  4. LLC business license renewal fees 

Where should I form my LLC?

In most cases, individuals will form their LLC in the state where they are intending to conduct business.

A local business will certainly want to locally form an LLC.

If you are not going to run a purely local business and you will deal with other states, you should be thoughtful as to where you will form your LLC.

It does not necessarily mean that the state that is the cheapest to form an LLC or the LLC price is more attractive is where you should set up your limited liability company.

You should look at your filing costs, annual costs, costs for filing in multiple states, state-specific costs like publication costs or franchise taxes.

How much does it cost to form an LLC?

Formation costs are those costs that you need to pay initially when you are registering or establishing your limited liability business.

The cost to form an LLC can include things like the fees associated with the filing of your articles of organization, reserving your LLC name or even publication fees in a local newspaper.

For example, in Nevada, you’ll pay $425 for your Nevada LLC formation.

What are the LLC maintenance costs?

When you say maintenance costs, you are typically referring to either annual report fees, biennial report fees or franchise tax fees.

Every state will have its own limited liability company maintenance costs.

For example, Colorado, your annual maintenance costs amount to $10 whereas California will cost you $810 due to the franchise tax fees charged by the state of California.

You’ll need to evaluate the maintenance costs per state.

What is a franchise tax?

A franchise tax is a yearly fee charged by some states to maintain a company’s registration active.

The franchise tax is generally a flat-fee although some states can charge a Franchise Tax based on your LLC’s annual earnings derived from that state.

For example, California has an annual franchise tax of $800 while Delaware costs $250.00 per year.

What are the annual report fees?

The annual report fees are the fees you must pay on an annual basis to keep your company in good standing with the registered state.

The annual report fees are also called “reporting fees”.

The annual report fees are typically over and above any applicable franchise tax.

For example, in New York, the franchise tax will depend on how many partners you have in your LLC and can range between $325 to $10,000.

What are biennial report fees?

Biennial report fees are fees that are payable every two years as opposed to annual report fees that are payable on a yearly basis.

In some states, you’ll have biennial report fees to pay.

For example, in New York, you’ll have biennial fees of $9 whereas in the District of Columbia (D.C.), you’ll have fees of $300 biennially.

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