What Is The Cost To Form An LLC?

What Is Cost To Form An LLC?

Cost of an LLC is considered on Two Factors:

  • Formation Cost
  • Maintenance Cost

You have an option to file your own documents and complete all legal procedures by yourself. But people often select lawyers and online incorporation service to save their time and focus more on their business. Involving a lawyer means the redemption of the registered agent, a lawyer would have a registered office/street address. A lawyer can cost anywhere from $1000 to $1500, whereas an online incorporation service will cost you from $250 to $700.

Cost Breakdown Of An LLC?

It is a great yet tough job to make an LLC, especially when it comes to financing. At this point, cost breakdown is the most effective tip. There are couples of legal formalities which require money; the following segment will throw light on the cost breakdown of an LLC. The initial costing is the formation cost, which includes:  

State Filing Fee:

This is a one-time state filing fee, which you will need to pay during filing a document with the secretary of the state. If you form an LLC by yourself then you will only need to pay the state filing fees which is $127. The state filing fees depend on the state to state. If you use an online corporation website then it would cost from $99 to $900. In case, you hire a lawyer then the cost would range from $900 to $1500. The state filing fees are compulsory in all the states.

Name Reservation Fees:

A small fee of about $10 to $28 is taken to reserve your LLC’s name so that you get copyright or in simpler terms, a unique identity. This is an optional condition which is applicable in only a few states.

Registered Agent:

A Registered agent/ a statutory agent is a person who agrees to accept services and process on behalf of your LLC. A registered agent receives lawsuits and official legal documents on behalf of you. Each state has its own registered agent requirements. It doesn’t matter if you DIY, hire a lawyer/ registered agent or build it online, you will have to have a street address located in the state where you are forming an LLC. You need to hire a commercial registered agent if you don’t have a street address.

Publishing Requirement:

Publish a note of your LLC in a local newspaper and send the “affidavit of publication” to LLC filing office (REQUIRED ONLY IN FEW STATES) The cost may vary on state and newspaper rates.

Operating Agreement:

As the name suggests, an operating agreement is an agreement between the members/ owners of an LLC which settles and sets their financial and working relations. An operating agreement is the most important part of an LLC. Creating, an operating agreement for a single member costs $350-$1000, and $750-$5000 for a multi-member LLC. Online creation of an LLC will cost anywhere from
$50 to $250.

Federal Tax Id:

A federal tax ID number is a free service provided by IRS, which helps you to open your business bank account. A federal tax number should be obtained after your LLC is approved. An EIN is used for filing taxes, getting credit cards and other finance-related activities. An EIN can be generated online for free from the IRS, just make sure the website you use is authenticated.

Licenses And Permits:

Licenses and Permits for LLC purpose are a little different and generally not included in the cost breakdown, but it is beneficial if this cost is taken too, as they are an important aspect.


Maintenance Cost of An LLC:

Annual Maintaining (Report) Fees:

This fee is applicable in most of the states. It ensures that your LLC is functioning in a good position. Fees for annual report various from state to state. The report crosses checks if there are any kind of changes in the name, address, registered agent, your growth, finances, etc. Failure of an annual report for an LLC can lead to confiscation of your business, license and negative consequences on the members or owners. If you don’t pay annual maintaining fees than, the state can either close or dissolve your LLC and having a low stand in the market is not good for the company. According to your vigilance, it can either work as boon or curse.

Franchise Taxes:

These taxes are fixed and flexible. They are taken on an early basis by the state. The amount of tax depends on the earnings of the company and the state tax rules.

State Wise LLC Cost:

State LLC         LLC Filing Fee                          LLC Annual/Biennial Fee
Alabama LLC $183 $100 minimum (every year)
Alaska LLC$250 $100 (every 2 years)
Arizona LLC$50 $0 (report due every year)
Arkansas LLC$50 $150 (every year)
California LLC$70 $800 (every year) + $20 (every 2 years)
Colorado LLC$50 $10 (every year)
Connecticut LLC$160 $20 (every year)
Delaware LLC$90 $300 (every year)
Florida LLC$125 $138.75 (every year)
Georgia LLC$100 $50 (every year)
Hawaii LLC$50 $15 (every year)
Idaho LLC$100 $0 (every year)
Illinois LLC$150 (used to be $500)$75 every year (used to be $250)
Indiana LLC$90 $30 (every 2 years)
Iowa LLC$50 $60 by mail or $45 online (every 2 years) [used to be $45 by mail and $30 online]
Kansas LLC$165 $55 (every year)
Kentucky LLC$40 (sorry, I said $90 in the video)$15 (every year)
Louisiana LLC$100 $35 (every year)
Maine LLC$175 $85 (every year)
Maryland LLC$100 $300 (every year)
Massachusetts LLC$500 $500 (every year)
Michigan LLC$50 $25 (every year)
Minnesota LLC$160 $0 (report due every year)
Mississippi LLC$50 $0 (report due every year)
Missouri LLC$105 $0 (no report)
Montana LLC$70 $20 (every year)
Nebraska LLC$105 $10 (every 2 years)
Nevada LLC$425 $350 (every year)
New Hampshire LLC$100 $100 (every year)
New Jersey LLC$125 $50 (every year)
New Mexico LLC$50 $0 (no report)
New York LLC$200 $9 (every 2 years)
North Carolina LLC$125 $200 (every year)
North Dakota LLC$135 $50 (every year)
Ohio LLC$99 $0 (no report)
Oklahoma LLC$100 $25 (every year)
Oregon LLC$100 $100 (every year)
Pennsylvania LLC$125 $70 (every 10 years)
Rhode Island LLC$150 $50 (every year)
South Carolina LLC$110 $0 (no report unless LLC is taxed as S-Corp)
South Dakota LLC$150 $50 (every year)
Tennessee LLC$300 $300 (every year)
Texas LLC$300 $0 (report due every year)
Utah LLC$70 $15 (every year)
Vermont LLC$125 $35 (every year)
Virginia LLC$100 $50 (every year)
Washington LLC$200 $60 (every year)
Washington DC LLC$220 $300 (every 2 years)
West Virginia LLC$100 $25 (every year)
Wisconsin LLC$130 $25 (every year)
Wyoming LLC$100 $50 (every year)