LLC Cost Guide: How Much LLCs Cost on Average and By State

Are you looking to shield your personal assets while launching your dream small business? A limited liability company (LLC) might serve you best, but the cost can vary dramatically depending on where you set it up—from a budget-friendly $35 registration fee in Montana to as much as $500 in Massachusetts.

As a business owner, where you establish your LLC can have a significant impact on startup margins, and that’s before factoring in costs like regular report preparation, franchise taxes, publication requirements, and legal or other professional help.

In this guide, you’ll find the information you need to factor LLC costs into your startup budget, wherever you set up your new company.

What is an LLC?

A limited liability company (LLC) is a popular business structure that combines the personal asset protection of a corporation with the tax advantages of a sole proprietorship or partnership.

For this reason, LLCs are often thought of as hybrid legal entities. Like a corporation, the LLC creates a legal shield between the personal finances of owners (also known as members) and the liabilities of the business. Like a sole proprietorship or partnership, the profits of the LLC pass through to the members, who then pay taxes on them at their personal income tax rates.

LLC members can be domestic or international individuals, corporations, and other LLCs. There is no limit to the number of members an LLC may have; an LLC can be owned and operated by a single member (a single-member LLC) or multiple members (a multi-member LLC).

Key benefits of an LLC

• Personal liability protection
• Pass-through taxation
• Minor compliance requirements

The LLC structure has the following advantages:

Personal liability protection

If an LLC is sued or subject to bankruptcy proceedings, the homes, vehicles, and savings of members are typically safe from legal judgments and creditors’ claims.

Pass-through taxation

LLC profits pass through directly to members, who pay individual income taxes at their personal rate on those earnings. In contrast, C corporation owners or shareholders are subject to so-called double taxation: earnings are taxed at the corporate level, then again when investors receive payouts from the company.

Minor compliance requirements

LLCs also avoid the corporate legal requirements of a board of directors, formal annual meetings, and complex recordkeeping and reporting.

Potential drawbacks of an LLC

• Fees
• Self-employment taxes
• Limited access to capital
• Difficulty selling or restructuring

There are also some drawbacks to keep in mind when it comes to LLCs:

Fees

LLCs typically must pay state filings fees, annual report fees, and recurring costs for a mandatory registered agent, the person or business that receives legal documents on the LLC’s behalf.

Self-employment taxes

Members typically pay self-employment taxes on all distributed profits, which can be as much as double the payroll tax rate employees of bigger companies pay. Some businesses operating across state lines may face additional registration fees and compliance obligations.

Limited access to capital

LLCs have limited options for raising capital. They can accept investments from members and outside parties but can’t issue shares like corporations.

Difficulty selling or restructuring

Selling, restructuring, or dissolving a multi-member LLC can prove difficult, requiring a majority vote of the membership (even if it’s not spelled out in the LLC operating agreement). For the same reason, a liquidation may be the only option for resolving major disagreements among members.

Alternatives to an LLC

Before committing to the LLC structure, study your business’s specific circumstances, niche, and market conditions, and consider consulting a lawyer to determine whether an alternative entity type is a better fit. These options include:

• Sole proprietorship. No significant formation costs, but no personal liability protection.

• Partnership. Simple formation process and pooled resources, but unlimited personal liability.

• S corporation. Potential self-employment tax savings, but stricter compliance rules.

• C corporation. Unlimited growth and capital-raising potential, but subject to double taxation.

LLC startup costs by state

The average total LLC cost nationwide is a little more than $130, though the costs of starting and maintaining an LLC can vary widely depending on your state. Initial LLC filing fees range from $35 to thousands of dollars, depending on circumstances like membership size and the LLC’s annual income. Some states also impose a wide array of fees that aren’t charged in others.

The basic LLC costs in most states include an initial filing fee for your articles of organization; a separate fee to register a foreign LLC (which operates in a state or country outside its formation location), if necessary; and a fee to file a required periodic report, typically once or twice a year.

Below is a list of essential LLC fees in all 50 states to compare formation and ongoing costs. Use this list as a reference, but make sure to check your state’s Secretary of State website for the most up-to-date information and a full accounting of state fees.

• Alabama. $200 filing fee, $150 foreign LLC fee.

• Alaska. $250 filing fee, $350 foreign LLC fee, $100 biannual fee.

• Arizona. $50 filing fee, $150 foreign LLC fee.

• Arkansas. $45 online filing fee, $50 filing fee by mail, $270 online foreign LLC fee, $300 foreign LLC fee by mail, $150 annual fee.

• California. $70 annual fee, $70 foreign LLC fee, $20 biannual fee, $800 minimum annual LLC franchise tax.

• Colorado. $50 filing fee, $100 foreign LLC fee, $10 annual fee.

• Connecticut. $120 filing fee, $120 foreign LLC fee, $80 annual fee.

• Delaware. $110 filing fee, $200 foreign LLC fee, $300 biannual fee.

• District of Columbia. $99 filing fee, $220 foreign LLC fee, $300 biannual fee.

• Florida. $125 filing fee, $125 foreign LLC fee, $139 annual fee.

• Georgia. $100 online filing fee, $110 filing fee by mail, $225 foreign LLC fee, $50 annual fee.

• Hawaii. $50 filing fee, $50 foreign LLC fee, $15 annual fee.

• Idaho. $100 filing fee ($120 for manual application), $100 foreign LLC fee.

• Illinois. $150 filing fee, $150 foreign LLC fee, $75 annual fee.

• Indiana. $95 filing fee, $105 foreign LLC fee, $31 online annual fee, $50 annual fee by mail.

• Iowa. $50 filing fee, $100 foreign LLC fee, $30 online annual fee, $45 annual fee by mail.

• Kansas. $160 filing fee, $165 foreign LLC fee, $100 online annual fee, $110 annual fee by mail.

• Kentucky. $40 filing fee, $90 foreign LLC fee, $15 annual fee.

• Louisiana. $100 filing fee, $125 foreign LLC fee, $30 annual fee.

• Maine. $175 filing fee, $250 foreign LLC fee, $85 annual domestic LLC fee, $150 annual foreign LLC fee.

• Maryland. $100 filing fee, $100 foreign LLC fee, $300 annual fee.

• Massachusetts. $500 filing fee, $500 foreign LLC fee, $500 annual fee.

• Michigan. $50 filing fee, $50 foreign LLC fee, $25 annual fee.

• Minnesota. $155 online filing fee, $135 filing fee by mail, $205 online foreign LLC fee, $185 foreign LLC fee by mail.

• Mississippi. $50 filing fee, $250 foreign LLC fee, $250 annual fee for foreign LLCs only.

• Missouri. $50 online filing fee, $105 filing fee by mail, $105 foreign LLC fee, $25 annual fee.

• Montana. $35 filing fee, $35 foreign LLC fee ($0 if filed before April 15).

• Nebraska. $100 online and mail-in filing fee, $110 in-person filing fee, $100 online and mail-in foreign LLC fee, $110 in-person foreign LLC fee, $25 online annual fee, $30 annual fee by mail.

• Nevada. $75 filing fee, $75 foreign LLC fee, $150 annual fee.

• New Hampshire. $100 filing fee, $100 foreign LLC fee, $100 annual fee.

• New Jersey. $125 filing fee, $125 foreign LLC fee, $75 annual fee.

• New Mexico. $50 filing fee, $100 foreign LLC fee.

• New York. $200 filing fee, $250 foreign LLC fee, $25-$4,500 annual fee depending on the LLC’s gross income.

• North Carolina. $125 filing fee, $250 foreign LLC fee, $203 online annual fee, $200 annual fee by mail.

• North Dakota. $135 filing fee, $135 foreign LLC fee, $50 annual fee.

• Ohio. $99 filing fee, $99 foreign LLC fee.

• Oklahoma. $100 filing fee, $300 foreign LLC fee, $25 annual fee.

• Oregon. $100 filing fee, $275 foreign LLC fee, $100 domestic LLC annual fee, $275 foreign LLC annual fee.

• Pennsylvania. $125 filing fee, $250 foreign LLC fee, $70 decennial (every 10 years) fee.

• Rhode Island. $150 filing fee, $150 foreign LLC fee, $50 annual fee.

• South Carolina. $110 filing fee, $110 foreign LLC fee.

• South Dakota. $150 online filing fee, $165 filing fee by mail, $750 online foreign LLC fee, $765 mail-in foreign LLC fee, $50 online annual fee, $65 annual fee by mail.

• Tennessee. $300-$3,000 filing fee depending on number of members, $300–$3,000 foreign LLC fee depending on number of members, $300–$3,000 annual fee depending on number of members.

• Texas. $300 filing fee, $750 foreign LLC fee, $0 annual fee.

• Utah. $59 filing fee, $59 foreign LLC fee, $18 annual fee.

• Vermont. $155 filing fee, $155 foreign LLC fee, $45 domestic LLC annual fee, $170 foreign LLC annual fee.

• Virginia. $100 filing fee, $100 foreign LLC fee, $50 annual fee.

• Washington. $200 online filing fee, $180 filing fee by mail, $200 online foreign LLC fee, $180 mail-in foreign LLC fee, $70 annual fee.

• West Virginia. $100 filing fee, $150 foreign LLC fee, $25 annual fee.

• Wisconsin. $130 online filing fee, $170 filing fee by mail, $100 foreign LLC fee, $25 domestic LLC annual fee, $80 foreign LLC annual fee.

• Wyoming. $100 filing fee, $150 foreign LLC fee, $60 plus annual fee depending on LLC assets.

Additional LLC costs

• Expedited filing fee
• Registered agent fee
• Publication fees
• LLC name reservation fee
• Business license fees
• Professional and legal fees

Aside from the fees listed above, you might incur other costs for setting up an LLC, including:

Expedited filing fee

A few states offer expedited processing for establishing new LLCs, including Arizona ($85), California ($350 for 24-hour turnaround and $750 for same day), Delaware ($50–$1,000), and New York ($25–$150 minimum).

Registered agent fee

All states require that LLCs (and some other business entities) designate a registered agent—a person who can receive legal documents on behalf of the company during normal business hours. An LLC member can act as its registered agent so long as that member satisfies certain state statutory requirements for registered agents (usually, they must live in the state and have some kind of physical address where they can receive documents). Many LLCs use a registered agent service, which typically charges between $100 and $300 a year.

Publication fees

Some states, including New York, Nebraska, and Arizona, require that new LLCs publish a public notice of formation. For example, in New York, LLCs must publish this notice in two printed newspapers (one daily and one weekly) in the county where the LLC’s office is located for six consecutive weeks. New York publication costs can range from $100 to more than $1,000, depending on the newspaper’s advertising prices, plus a $50 filing fee for the state Certificate of Publication.

LLC name reservation fee

You may want to reserve your business name ahead of time while setting up your LLC. Many states offer the ability to do so for a fee and for a set period of time. For example, in Illinois, it costs $25 to reserve an LLC name for 90 days.

Business license fees

If you plan to conduct business in a regulated industry (alcohol, beauty salons, and financial advisers, among others), you will probably need a state business license or permit. Some county and municipal governments may also require a business license or permit to operate locally. State and local authorities sometimes charge periodic business license renewal fees as well.

Professional and legal fees

You may want to use an LLC formation service, attorney, or other licensed professional (like an accountant) to help you form an LLC. These services or individual professionals can help you compile LLC formation documents; understand liability and tax benefits; prepare local, state, and federal tax documents; and file required annual or biannual reports. They can also help you obtain an employer identification number (EIN) from the US Internal Revenue Service, which is typically required to open a business bank account. (You can also obtain this number yourself, free of charge.)