LLC Costs: How Much It Costs to Form an LLC Today

Forming an LLC costs between $35 and $500 in state filing fees, depending on where you file. But the filing fee is just the beginning — ongoing annual fees, registered agent costs, and other expenses add up.

This guide breaks down every LLC cost you’ll face, from initial formation to annual maintenance, with a complete state-by-state fee table.

LLC Filing Fees by State (2026)

Every state charges a one-time fee to file your articles of organization (the document that officially creates your LLC). Here’s what each state charges:

Fees current as of 2026. Annual fees may vary based on revenue, number of members, or other factors.

Cheapest states to form an LLC: Montana ($35), Kentucky ($40), Arkansas ($45), and Arizona, Colorado, Hawaii, Iowa, Michigan, Minnesota, Mississippi, Missouri, and New Mexico (all $50).

Most expensive states: Massachusetts ($500), Nevada ($425), Tennessee ($300), and Texas ($300).

Ongoing LLC Costs

The filing fee is a one-time cost. Here’s what you’ll pay on an ongoing basis to keep your LLC in good standing:

Annual Report Fees

Most states require LLCs to file an annual (or biennial) report and pay a fee. This is the state’s way of confirming your business is still active and your information is current. Annual report fees range from $0 to $500+. See the table above for each state’s requirement.

Six states don’t require annual reports or charge $0: Arizona, Mississippi, Missouri, New Mexico, Ohio, and South Carolina.

State Franchise Tax

Some states charge a franchise tax or privilege tax just for doing business in the state, regardless of profit:

• California: $800/year minimum franchise tax (waived for the first year for new LLCs)
• Delaware: $300/year flat tax
• Tennessee: $300/year minimum franchise tax
• Texas: No franchise tax if revenue is under $2.47 million (most small LLCs pay $0)
• Illinois: $75/year (annual report fee serves as the ongoing state fee)

Registered Agent Fees

Every LLC must have a registered agent — a person or service that receives legal documents on behalf of your business. You have three options:

• Be your own registered agent: $0 (but you must have a physical address in the state and be available during business hours)
• Use a professional service: $39-$299/year depending on the provider
• Use your LLC formation service: Many formation services include the first year free

Most small business owners use a registered agent service for privacy and convenience. Our top pick, Northwest Registered Agent, charges $39/year.

Business License Fees

Depending on your industry and location, you may need local, state, or federal business licenses. Costs vary widely:

• General business license: $50-$400/year (city/county level)
• Professional licenses: $100-$1,000+ depending on profession
• Home occupation permit: $0-$100

EIN (Free)

An Employer Identification Number (EIN) is free from the IRS. You can apply online and receive it immediately. Don’t pay a third party for this — it’s always free directly from the IRS.

Optional LLC Costs

These costs aren’t required but are common for LLC owners:

LLC Formation Service

You can form an LLC yourself for just the state filing fee, or use a formation service for convenience. Formation service costs:

Operating Agreement

An operating agreement defines how your LLC is managed and how profits are split. Costs:

• DIY (free template): $0
• Online legal service: $50-$200
• Business attorney: $500-$2,000

While not legally required in most states, an operating agreement is strongly recommended for every LLC — especially multi-member LLCs.

DBA (Doing Business As)

If you want to operate under a name different from your LLC’s legal name, you’ll need to file a DBA. Cost: $10-$100 depending on your state and county.

Business Insurance

General liability insurance for small LLCs typically costs $300-$1,000/year. While not always required, it adds an important layer of protection beyond what your LLC provides.

Business Bank Account

Most business checking accounts are free or low-cost ($0-$15/month). You should always keep LLC funds separate from personal funds to maintain your liability protection.

Total LLC Cost: What to Budget

Here’s a realistic breakdown of what an LLC costs in the first year and annually after that:

For most small LLCs in affordable states, expect to pay $100-$300 in the first year and $50-$200 annually to maintain your LLC.

How to Form an LLC for Free (or Cheap)

If you’re on a tight budget, here’s how to minimize costs:

1. Choose an affordable state. Form in your home state (don’t form in another state just for lower fees — you’ll end up paying in both states). States like Arizona ($50 filing, $0 annual) and Colorado ($50 filing, $10 annual) are among the cheapest.
2. File articles yourself. Skip the formation service and file directly with your Secretary of State’s website. It takes 15-30 minutes.
3. Be your own registered agent. Save $39-$299/year if you have a physical address in the state and can be available during business hours.
4. Get your EIN free from the IRS. Apply at irs.gov — it takes 5 minutes and costs nothing.
5. Write your own operating agreement. Use a free template. It doesn’t need to be complicated for a single-member LLC.

Minimum possible cost: As low as $35 (Montana) to $50 (several states) for just the state filing fee.

LLC Cost vs. Other Business Structures

An LLC is the most popular business structure for small businesses because it offers liability protection and tax flexibility at a relatively low cost. Learn more in our LLC vs sole proprietorship comparison.

Frequently Asked Questions

How much does it cost to start an LLC?

The minimum cost is your state’s filing fee, which ranges from $35 (Montana) to $500 (Massachusetts). Most states charge $50-$200. Add $39-$299/year if you use a registered agent service. Total first-year cost for most people is $100-$300.

What is the cheapest state to form an LLC?

Montana has the lowest filing fee at $35. However, you should almost always form your LLC in the state where you live and do business. Forming in another state just for lower fees means you’ll need to register as a foreign LLC in your home state too — doubling your costs and paperwork.

Do LLCs pay annual fees?

Most states require an annual (or biennial) report with a fee ranging from $0 to $800+. Six states — Arizona, Mississippi, Missouri, New Mexico, Ohio, and South Carolina — don’t require annual reports. California has the highest ongoing cost with its $800/year franchise tax.

Is an EIN free?

Yes. An EIN is always free when you apply directly through the IRS website. Some formation services charge $50-$100 to get an EIN for you — don’t pay for this. You can apply yourself in 5 minutes.

Can I form an LLC myself without a lawyer?

Yes. Most LLC formations don’t require a lawyer. You can file directly with your state’s Secretary of State website. The process typically takes 15-30 minutes online. A lawyer is only needed for complex situations like multi-member LLCs with unusual profit-sharing arrangements.

Why is California’s LLC so expensive?

California charges an $800 annual franchise tax for all LLCs, regardless of income. This is in addition to the $70 filing fee. New LLCs formed in 2024 or later get the first year waived. Despite the cost, if you live and do business in California, you should still form your LLC there rather than in another state.

What are the hidden costs of an LLC?

The most commonly overlooked costs include: annual report fees (easy to miss and can result in dissolution), business licenses at the city/county level, professional licenses for regulated industries, publication requirements in states like New York ($200-$1,500) and Arizona (approximately $150-$300), and business insurance premiums.