Starting an LLC protects your personal money and property from business problems. It also makes your business look more professional. But there’s one big question that stops most people before they start: how much does it actually cost?
The answer changes based on where you live. Some states charge as little as $40 to start an LLC. Others charge $500 or more. Beyond that first payment, there are other costs like registered agents, yearly reports, and business licenses that catch people by surprise.
This guide shows you every dollar you’ll spend, both when you start and every year after. No surprises, no hidden fees.
Table of contents
Quick answer: what you’ll pay to start an LLC
The cost to form an LLC breaks down into three main parts. First, there’s the state filing fee, which you pay once when you create your LLC. Second, there are the optional services that make things easier but aren’t required. Third, there are the yearly costs to keep your LLC running legally.
Most people spend between $100 and $500 to start their LLC, depending on their state. After that, expect to pay $100 to $800 every year for ongoing requirements. States like California and Massachusetts cost more, while states like Kentucky and Arizona cost less.
Complete state-by-state LLC filing fees
Here’s what every state charges to file your LLC paperwork. The table also shows how long it takes and what you’ll pay each year to stay legal.
| State | Filing Fee | Processing Time | Annual Report Fee | Notes |
|---|---|---|---|---|
| Alabama | $200 | 7-10 days | $50 | Requires publication in some counties |
| Alaska | $250 | 15 days | $100 | Biennial report |
| Arizona | $50 | 3-5 days | None | No annual report required |
| Arkansas | $45 | 7-10 days | $150 | Annual franchise tax |
| California | $70 | 5-7 days | $20 + $800 tax | $800 annual franchise tax |
| Colorado | $50 | 7-10 days | $10 | Periodic report |
| Connecticut | $120 | 10-15 days | $80 | Annual report |
| Delaware | $90 | 5-7 days | $300 | Annual franchise tax |
| Florida | $125 | 5-7 days | $138.75 | Annual report |
| Georgia | $100 | 7-10 days | $50 | Annual registration |
| Hawaii | $50 | 5-10 days | $15 | Annual report |
| Idaho | $100 | 10-15 days | None | No annual report |
| Illinois | $150 | 10-15 days | $75 | Annual report |
| Indiana | $95 | 7-10 days | $30 | Biennial report |
| Iowa | $50 | 7-10 days | $60 | Biennial report |
| Kansas | $160 | 5-7 days | $50 | Annual report |
| Kentucky | $40 | 7-10 days | $15 | Annual report |
| Louisiana | $100 | 10-15 days | $30 | Annual report |
| Maine | $175 | 10-15 days | $85 | Annual report |
| Maryland | $100 | 7-10 days | $300 | Annual report |
| Massachusetts | $500 | 10-15 days | $500 | Annual report |
| Michigan | $50 | 10-15 days | $25 | Annual report |
| Minnesota | $135 | 7-10 days | None | No annual report |
| Mississippi | $50 | 10-15 days | None | No annual report |
| Missouri | $50 | 5-7 days | None | No annual report |
| Montana | $70 | 10-15 days | $20 | Annual report |
| Nebraska | $100 | 7-10 days | $10 | Biennial report |
| Nevada | $75 | 5-7 days | $350 | Annual list + business license |
| New Hampshire | $100 | 10-15 days | $100 | Annual report |
| New Jersey | $125 | 10-15 days | $75 | Annual report |
| New Mexico | $50 | 10-15 days | None | No annual report |
| New York | $200 | 7-10 days | $9 | Biennial report + publication requirement |
| North Carolina | $125 | 10-15 days | $200 | Annual report |
| North Dakota | $135 | 10-15 days | $50 | Annual report |
| Ohio | $99 | 7-10 days | None | No annual report |
| Oklahoma | $100 | 10-15 days | $25 | Annual report |
| Oregon | $100 | 10-15 days | $100 | Annual report |
| Pennsylvania | $125 | 10-15 days | None | No annual report |
| Rhode Island | $150 | 10-15 days | $50 | Annual report |
| South Carolina | $110 | 7-10 days | None | No annual report |
| South Dakota | $150 | 5-7 days | $50 | Annual report |
| Tennessee | $300 | 7-10 days | $300 | Annual report (6+ members = $50/member) |
| Texas | $300 | 5-7 days | None | No annual report |
| Utah | $70 | 7-10 days | $18 | Annual renewal |
| Vermont | $125 | 10-15 days | $35 | Annual report |
| Virginia | $100 | 7-10 days | $50 | Annual report |
| Washington | $200 | 7-10 days | $60 | Annual report |
| Washington DC | $220 | 10-15 days | $300 | Biennial report |
| West Virginia | $100 | 10-15 days | $25 | Annual report |
| Wisconsin | $130 | 10-15 days | $25 | Annual report |
| Wyoming | $100 | 7-10 days | $60 | Annual report |
So what is the cheapest state?
The three cheapest states are Kentucky at $40, Arkansas at $45, and Arizona at $50. The most expensive states are Massachusetts at $500, Tennessee at $300, and Texas at $300. Tennessee can actually cost more if you have lots of LLC members because they charge $50 per person after the first six members.
All the costs you need to know about
The state filing fee gets your LLC started, but it’s not the only money you’ll spend. Understanding all the costs ahead of time helps you budget correctly and avoid running into problems later.
What you pay when you start
The first cost everyone pays is the Articles of Organization filing fee. This is the main form that creates your LLC legally. You send it to your state government along with the fee shown in the table above. Every state requires this, and you pay it one time only when you form your LLC.
Some people also pay to reserve their business name before filing the full paperwork. Most states let you hold a name for 60 to 120 days for $10 to $50. However, most business owners skip this step and just file everything at once. You only need name reservation if you’re not ready to start your business yet but want to make sure nobody else takes your name.
Your bank or a lender might ask for a Certificate of Good Standing later on. This is an official paper from your state proving your LLC exists and follows all the rules. It costs between $5 and $50 depending on where you live. Most people don’t need this right when they start, so you can wait until someone asks for it.
A few states make you publish a notice in the newspaper announcing your new LLC. This surprises a lot of people because it can cost serious money. New York is the worst, charging anywhere from $1,000 to $2,000 depending on which county you’re in. Arizona requires publication too but only costs $50 to $200. Nebraska falls in between at $25 to $100. Check if your state has this requirement before you start because it can change your budget significantly.
What you pay every year
Every LLC needs a registered agent with a physical address in your state who accepts legal mail during business hours. You can be your own agent for free, but your home address becomes public record and you must be available every weekday. Most people hire a service instead.
Registered agent services cost $100 to $300 yearly. Northwest Registered Agent charges $125, Bizee costs $119, and LegalZoom runs $199 per year. This keeps your address private and ensures you never miss important documents.
Most states require annual or biennial reports confirming your LLC information is current. Some call it a Statement of Information or Periodic Report. Check the table above for your state’s cost, which ranges from free in Arizona to $500 in Massachusetts.
Almost every business needs at least one operating license. Basic business licenses cost $50 to $400 annually. Professional licenses for contractors, healthcare, or real estate run $100 to $1,000 or more yearly. Costs vary based on your industry, location, and specific requirements.
Some states charge yearly franchise taxes separate from income taxes. California hits hardest with an $800 annual tax regardless of profit. Delaware charges $300 yearly, while Texas bases their franchise tax on revenue. Most states don’t have this tax, but if yours does, budget accordingly.
Costs that help but aren’t required
An operating agreement isn’t legally required in most states, but you should have one anyway. This document defines ownership, profit distribution, and decision-making. Even single-owner LLCs benefit from having this protection on paper.You can use a free template online, buy one for $25 to $50, or pay online services $50 to $150. Custom attorney-drafted agreements cost $500 to $2,000, but templates work fine for most small businesses.
Getting an EIN is free on the IRS website. This social security number for your business takes 15 minutes to obtain online, and the IRS provides it instantly. Never pay formation companies $50 to $100 for something you can do yourself free in the same time.You’ll need a business bank account to separate personal and business finances. Some banks offer free business checking with no monthly fees or minimums. Others charge $15 to $30 monthly plus transaction fees. Online banks like Novo, Relay, and Axos typically offer free accounts, while traditional banks charge more. Compare options before choosing.
Business insurance isn’t legally required but protects against expensive problems. General liability insurance costs $300 to $1,000 yearly and covers accidents or injuries. Professional liability insurance runs $500 to $2,000 annually, protecting service businesses from mistakes or missed deadlines. Workers compensation insurance is required for employees, with costs varying by state and industry.
Should you form your LLC yourself or use a service?
You can either file your LLC paperwork yourself or pay a company to do it for you. Both ways work fine, but they have different costs and benefits.
Forming your LLC yourself
When you form an LLC yourself, you only pay the state filing fee shown in the table above. This means your total cost is somewhere between $40 and $500 depending on your state. You handle everything on your own from start to finish.
Here’s what you do when you file yourself. First, you research your state’s specific rules and requirements. Then you fill out the Articles of Organization form that your state provides. Next, you submit the form to your Secretary of State either online or through the mail along with your payment. After your LLC is approved, you get an EIN from the IRS website. Finally, you create an operating agreement using a template and start handling your registered agent duties yourself.
The big advantage of filing yourself is saving money. You only pay what the state requires and nothing more. You also get complete control over the process and timing. Additionally, you learn how your LLC works by going through each step yourself.
However, there are downsides to filing yourself. The process takes time and research, usually about 3 to 5 hours total. You risk making mistakes that could require expensive corrections later. Your home address becomes public record since you’ll likely be your own registered agent. You’re also responsible for tracking all compliance deadlines yourself without reminders.
Doing it yourself makes sense if you’re comfortable reading instructions and filling out government forms. It also works well if you have the time to research your state’s specific requirements carefully. Just make sure you double-check everything before submitting to avoid costly mistakes.
Using an LLC formation service
LLC formation services handle the paperwork for you. You pay a service fee (free to $300) plus state filing costs. They prepare and file your documents, provide registered agent service for at least one year, offer operating agreement templates, and send compliance reminders.
Northwest Registered Agent charges $39 plus state fees. They focus on privacy without pushy upselling. Registered agent service is free the first year, then $125 annually. Operating agreements and EIN filing cost $50 each if needed.
Bizee (formerly Incfile) offers a completely free basic plan where you only pay state fees. Their registered agent is free the first year, then $119 yearly. Their Gold package at $199 plus state fees includes operating agreement and EIN filing, providing good value for bundled services.
LegalZoom costs free to $299 for service, plus state fees. Their registered agent costs $199 annually starting immediately, more expensive than competitors. However, some packages include attorney consultations, which helps if you have legal questions. Overall cost is higher, but some people value lawyer access.
Using a formation service makes sense if you value your time at more than $25 hourly. You save hours of research and filing work. These companies help avoid mistakes that cost $50 to $100 to fix and keep your home address private by using theirs on public records. Automated compliance reminders prevent missing deadlines that could dissolve your LLC.
Costs that surprise new business owners
Several expenses catch new LLC owners off guard. Knowing these ahead of time helps you budget correctly. Most cities and counties require their own business licenses separate from state filing. Just because your LLC is registered with the state doesn’t mean you can operate. City and county business licenses cost $50 to $500 yearly. Call your city hall to find out requirements.
If you sell physical products, you need a sales tax permit. Getting the permit is usually free, but you must learn the rules and file regular reports. Each state handles sales tax differently.
Certain professions require specific licenses before you can legally work. Contractors, healthcare workers, real estate agents, accountants, and other professionals need industry-specific licenses costing $100 to $1,000 annually. Check with your state licensing board.
Running a business from home might require a home occupation permit costing $25 to $200. This is common if customers visit your house or you create noise that bothers neighbors.
If your LLC operates under a different name, you need a DBA filing. For example, if your LLC is “Smith Enterprises LLC” but customers know you as “Smith’s Plumbing,” you file a DBA costing $10 to $100.
You’ll need bookkeeping help. Accounting software costs $10 to $50 monthly. Hiring a bookkeeper runs $200 to $500 monthly. Getting an accountant for yearly taxes costs $500 to $2,000. Budget for at least software if handling it yourself.
What it actually costs in real life
Looking at specific examples helps you understand what you’ll really spend. Here are three common situations showing the total costs in different states.
Starting an LLC in California
California is one of the most expensive states for LLCs because of their franchise tax. If you form an LLC in California and use Northwest Registered Agent to help, here’s your first year breakdown.
The state filing fee is $70. Northwest charges $39 for their service. The registered agent is included free for the first year. Adding an operating agreement costs $50. If you’re in Los Angeles, your city business license is another $75. Your total startup cost comes to $234.
After that first year, California gets expensive. The annual franchise tax is $800, which you have to pay even if your business made no money. The Statement of Information costs $20. Your registered agent service renews at $125. Your Los Angeles business license renewal is $75. This means you’ll pay $1,020 every year to keep your California LLC legal.
Starting an LLC in Texas
Texas charges more upfront but has lower ongoing costs. Using Bizee’s Gold package makes sense here because it includes everything you need at a reasonable price.
The Texas state filing fee is $300. Bizee’s Gold package costs $199 and includes the registered agent for year one, your operating agreement, and EIN filing. A basic business license runs about $50. Your total startup cost is $549.
The good news is Texas doesn’t require annual reports, so you don’t pay the state anything after formation. Your registered agent renews at $119 in year two. Your business license renewal is $50. This means you only pay $169 every year after the first year. Over time, Texas becomes much cheaper than California even though it costs more to start.
Starting an LLC in Kentucky
Kentucky has the lowest filing fee in the country, making it perfect for bootstrapping your business. You can easily do everything yourself here and keep costs under $150.
Kentucky’s state filing fee is only $40. If you file yourself, there’s no service fee. An operating agreement template costs about $25. Getting your EIN from the IRS is free. Acting as your own registered agent costs nothing. A basic business license runs $40. Your total startup cost is just $105.
Kentucky’s ongoing costs stay low too. The annual report is $15. Since you’re your own registered agent, that’s free. Business license renewal is $40. You’ll only spend $55 per year to maintain your Kentucky LLC. This shows you can start and run an LLC affordably if you choose the right state and handle things yourself.
How to spend less money on your LLC
You can reduce your LLC costs without cutting corners. These strategies help you save money while protecting your business properly.
File yourself in simple states. Arizona, Missouri, and Kentucky have straightforward processes. If you’re comfortable following instructions, you can save $100 to $300 by filing yourself.
Be your own registered agent only if:
- You have a physical address (not a PO box)
- You’re okay with your home address being public
- You’re available during business hours every weekday
- You’re organized about tracking legal mail
This saves $100 to $150 yearly. Otherwise, paying for the service is worth it.
Get your EIN free from the IRS. Never pay $50 to $100 for something that takes 15 minutes yourself on the IRS website. The process is simple and instant.
Use free business banking. Online banks like Novo, Relay, Axos Bank, and BlueVine have no monthly fees or minimum balances. Traditional banks charge $15 to $30 monthly. Free banking saves $180 to $360 yearly.
Use operating agreement templates. Find free templates online for your state and customize them yourself. This saves $100 to $500 in lawyer fees. Templates work fine for most small businesses.
Buy package deals. When you need multiple services, bundles cost less. Bizee’s Gold package at $199 includes operating agreement, EIN filing, and registered agent. Buying separately costs $250 or more.
Skip unnecessary add-ons:
- Website builders (use WordPress instead)
- Trademark searches (unless you have a unique brand)
- Compliance monitoring (good services include this free)
- Corporate kit binders (keep documents digital)
Small savings add up quickly.
Common questions about LLC costs
Can I start an LLC without paying anything?
No, every state requires you to pay their filing fee. There’s no way around this cost. However, some companies like Bizee and LegalZoom charge zero dollars for their service, meaning you only pay what the state requires. So while you can’t form an LLC completely free, you can form one for just $40 to $500 depending on your state by using a free service and only paying the state fee.
What’s the absolute cheapest way to start an LLC?
The cheapest possible way is filing yourself in Kentucky, which only charges $40. Add a $25 operating agreement template, and your total startup cost is $65. Then be your own registered agent and handle your own licenses to keep ongoing costs under $100 per year. However, this requires time and organization on your part.
Do I have to file paperwork every year?
Most states require either an annual report or a biennial report to keep your LLC active. Check the table at the top of this article for your state’s requirement. Some states like Arizona, Missouri, and Ohio don’t require annual reports at all. Missing these filings can cause the state to shut down your LLC, so mark the dates on your calendar or use a service that reminds you.
Why does California charge so much more than other states?
California adds an $800 franchise tax every single year on top of everything else. This applies to every LLC doing business in California, whether you made money or lost money that year. It’s one of the main reasons California is expensive for business owners. New York also gets expensive because of their newspaper publication requirement that costs $1,000 or more.
Can I form my LLC in Delaware to save money?
Technically yes, but it usually doesn’t save you anything. Delaware is famous for being business-friendly, and many huge corporations form there. However, if you live in California and form your LLC in Delaware, you still have to register as a foreign LLC in California to actually do business there. This means you pay fees in both states. Only form your LLC in Delaware if you have a specific legal reason. Otherwise, form it where you actually work.
What happens if I don’t pay the annual fees?
Your LLC falls out of good standing with your state government. The state sends you warnings first, but if you ignore them, they eventually dissolve your LLC administratively. This is bad because you lose your liability protection, you can’t legally operate your business anymore, and getting reinstated costs money. Most states charge $50 to $500 to reinstate a dissolved LLC, plus you have to pay all the back fees you missed. It’s much easier to just pay on time.
How long does it take to form an LLC?
Most states process your paperwork in 3 to 15 business days after they receive it. The exact time depends on how busy your state government is and what time of year you file. Many states let you pay extra for expedited processing, usually $50 to $200 more, which cuts the time down to 1 to 3 days. Using a formation service doesn’t make the state work faster. They just file the same paperwork you would. The processing time is the same either way.
Do I need a lawyer to start an LLC?
No, you don’t need a lawyer for a basic LLC. The formation process is straightforward in most states. Thousands of people form LLCs every day without lawyers. However, you might want legal advice if your situation is complicated, like if you have multiple owners who disagree on things, if you’re in a highly regulated industry, or if you’re worried about lawsuits. For a simple one-person LLC doing normal business, you don’t need a lawyer.
Plan your LLC budget
Now you know what to expect when forming your LLC. Costs break down into startup and ongoing annual expenses.
Startup costs:
- DIY in cheap state: $100-$200
- DIY in expensive state: $300-$600
- With service (cheap state): $200-$400
- With service (expensive state): $400-$800
Ongoing yearly costs:
- Cheap states: $100-$300
- Moderate states: $300-$600
- Expensive states (like California): $1,000-$1,500
For most people, plan on spending $500 to $1,000 in your first year. After that, budget $300 to $800 annually for ongoing compliance.
These costs are small compared to the protection an LLC provides. Your personal house, car, and savings stay protected even if your business gets sued or goes into debt. Customers and vendors take you more seriously with LLC after your name. The cost of forming and maintaining an LLC is nothing compared to losing everything in a lawsuit.
Ready to form your LLC? Check out our comparison of the best LLC formation services to find the right option for your budget and needs.
Related articles:
- LegalZoom vs Incfile vs Northwest: Which LLC Service Is Best?
- How to Start a Business: Complete Legal Guide
- LLC Operating Agreement: Free Template + Guide
- Sole Proprietorship vs LLC: Which Is Right for You?
- What Is a Registered Agent and Do You Need One?
Prices accurate as of October 2025. State filing fees change occasionally, so verify current costs on your Secretary of State website before filing.
