How Much Does It Cost To Start An LLC?

How much does it cost to start an LLC in different States of the US?

Need to form an LLC? Cost is one of the primary things you must sort out. There are several expenses to be made when starting or renewing an LLC.

We will be discussing these startup costs and more.

This article aims to provide as much information as required. This is aimed at helping you prepare beforehand and also make informed choices.

Contents

Cost of Forming An LLC

Successfully forming an LLC depends on meeting all obligations required of you.

Cost is an essential part of such obligations. You’ll find different costs you are likely to incur as you read through. One of the factors that influence this is your location.

Filing for an LLC is done at the state level. Here, no uniform fees apply. As a result, certain states demand higher prices than others. Such costs may be paid annually or biennially.

Still, certain states have no ongoing costs at all. We will cover this in greater detail later on.

Available Options

Several options are available when filing an option. This includes taking upon yourself the responsibility of filing with your state. This might be more demanding than the others.

You will have to find out the LLC filing fees for your state. The second option available to you involves hiring a lawyer. Typically fees will range from $1,000.00 to $2,000.

The third option includes the use of an online website. This is made available for incorporation purposes. Applying for an LLC using the alternative will cost between $99 to $900.

Paying the upper limit ($900) fee will cover the mandatory Employer Identification Number (EIN).

All the methods above will attract state filing fee costs. There’s no fixed fee when it comes to state filing fees. These differ from one state to the other. Filing costs typically range between $40 to $500.

More details on this will be provided shortly.

Name Reservation Fees

A name reservation fee will need to be paid to form an LLC in certain states. Alabama is one such. However, this fee isn’t much and will cost around $10 to $28.

While this is compulsory for LLC filings, it can be skipped in other states.

Publication Fees

After forming an LLC, certain states require that you put the word out by publishing a statement of formation in local dailies. Is your state on this list?

You’ll incur this cost if you live or will be forming an LLC in New York, Pennsylvania, Nevada, Arizona, and Nebraska.

There’s no uniform cost for publication fees across these states. You’ll pay as little as $40 in certain conditions, while publishing your statement of formation will cost as much as $2,000 in others.

Franchise Tax

Not all states charge the franchise tax to newly created LLCs. While most taxes are levied on income, the franchise tax is calculated based on your business entity’s net worth or capital.

There is no uniform franchise. Therefore this will vary with different states. You’ll need to find out what applies to your state.

Maintenance Costs

After paying the required fees for forming an LLC, additional costs will still apply. These are annual fees and are known as the maintenance cost. It is delivered to keep your LLC in good standing.

So, what if you don’t pay? Not paying this fee will affect your business. It might lead to the state blocking your LLC. Most states require the payment of maintenance costs.

The Best Place To Form An LLC

We’ve talked about certain states requiring fees for some filing requirements.

To cut down on costs, some readers might ask which location or condition is best to file for an LLC. The answer to this question will be to form your LLC in the state you wish to do business.

Why? Doing otherwise will attract unwanted costs as you’ll need to file additional paperwork, which will cost you more.

LLC Filing Cost For Each State

To better understand the cost implications for LLC filing, we must provide LLC filing costs for all states. That way, you have an understanding of what fees are applicable.

We’ve included both setup costs as well as recurrent or ongoing costs.

State Setup Costs Recurrent/Ongoing Costs

Alabama $200+ Annual Privilege License
Alaska $250 $200 biennially
Arizona $50 incl. publishing Nil
Arkansas $50 $150 annually
California $70 Annual franchise tax + $20 annually
Colorado $50 $10 annually
Connecticut $120 $20 annually
Delaware $90 $300 annual franchise tax
District of Colombia $220 $300 biennially incl. annual franchise tax
Florida $125 $138.75 annually
Georgia $100 $50 annually
Hawaii $50 $15 annually
Idaho $100 Nil
Illinois $150 $250-$300 annually
Indiana $95 $50 biennially
Iowa $50 $30 – $45 biennially
Kansas $160 $50 – $55 annually
Kentucky $40 $15-$30 annually+annual entity tax
Louisiana $100 $30 annually
Maine $175 $85 annually
Maryland $100 $300 annually
Massachusetts $500 $500 annually
Michigan $50 $25 annually
Minnesota $155 Annual Partnership Tax
Mississippi $50 Nil
Missouri $50 Nil
Montana $70 $20 annually
Nebraska $100+Publishing Requirement $10 – $13 biennially
Nevada $75 $125 annually
New Hampshire $100 $100 annual+annual enterprise tax
New Jersey $125 $50 annually
New Mexico $50 Nil
New York $200+publishing requirement $9 biennial+annual filing fee
North Carolina $125 $200 annually
North Dakota $135 $50 annually
Ohio’s $99 Annual commercial activity tax
Oklahoma $100 $25 annually
Oregon $100 $100 annually
Pennsylvania $125+publishing requirement Nil
Rhode Island $150 $50 annually
South Carolina $110 Nil
South Dakota $150 $50 annually
Tennessee $300 minimum annual franchise & excise tax
Texas $300 annual fee
Utah $70 $20 annually
Vermont $125 $35 annually
Virginia $100 $50 annually
Washington $180-$200 $60 annually
West Virginia $100 $25 annually
Wisconsin $120-$170 $25 annually
Wyoming $100-$102 $50 or 0.02% value of annual assets

What Option To Use

Earlier, we mentioned that you could either handle your LLC application process, hire a lawyer, or use the incorporation website.

The option you choose depends on what your needs are. It’s best to allow a professional to handle the process for you if you have a lot of things on your hands. That way, you are saved a lot of stress.

Starting or forming an LLC involves different cost angles.

We’ve discussed these extensively in addition to each state’s filing fees. You only need to look up your state from the list to find applicable LLC formation fees.