How Much Does an LLC Cost? State-by-State Breakdown

Forming an LLC involves a handful of upfront expenses that you pay once and never again. The big one is the Articles of Organization filing fee, which every state charges. This is the document that legally creates your LLC, and the fee ranges from $50 in states like Kentucky and Arkansas to $500 in Massachusetts.

Beyond the filing fee, most founders spend money on a few other one-time items:

• Name reservation -- $10 to $50 in states that offer it. Not required, but useful if you need time before filing.
• Certified copies of your Articles -- $5 to $20 per copy. Banks often ask for these when you open a business account.
• Operating agreement drafting -- $0 if you write it yourself, $200 to $800 if you hire an attorney.
• EIN from the IRS -- completely free. Any service charging you for this is pocketing pure profit.

For a single-member LLC doing business in its home state, expect to spend $50 to $500 on formation alone, with most people landing between $100 and $200. That puts LLC formation well within reach of low-cost business ideas that you can launch on a tight budget.

One thing worth knowing: some states process filings faster if you pay extra. California charges $350 for same-day processing on top of the $70 base fee. New York charges $25 for 24-hour processing. If you are not in a rush, skip the expedite fee.

Your state filing fee is the single largest upfront cost of forming an LLC. Here is what you will pay in the ten most popular states for LLC formation:

Notice the spread. Nevada at $425 costs more than six times what California charges at $70. That said, filing fees alone should not dictate where you form your LLC. A cheap filing fee means nothing if the state hits you with $800 in annual franchise taxes (looking at you, California).

Texas is interesting -- the $300 fee is steep, but processing is fast and there is no state income tax. If you already live and do business in Texas, the higher fee pays for itself through simpler compliance.

For a deeper comparison of all 50 states, including annual costs and tax implications, check the full best states to form an LLC breakdown.

Formation is a one-time expense. The ongoing costs are what actually add up over the life of your LLC. Every LLC owner should budget for three recurring categories.

Annual reports. Most states require your LLC to file an annual (or biennial) report confirming your business address, members, and registered agent. Fees range from $0 in a few states to $300 in others. Some examples: Wyoming charges $60, Florida charges $138.75, and California does not require an annual report at all but has its own franchise tax instead.

Franchise taxes. This is separate from income tax and catches people off guard. California charges every LLC a flat $800 per year -- even if the LLC earns zero revenue. Delaware charges $300 per year. Texas imposes a franchise tax on LLCs grossing over $2.47 million. If your LLC is small, these taxes matter because they eat into thin margins before you ever turn a profit.

Registered agent fees. Your LLC needs a registered agent in its state of formation. You can serve as your own agent for free in most states, but that means your home address goes on public record. Professional registered agent services run $50 to $300 per year. Northwest Registered Agent charges $125, Incfile offers a free year with their formation package, and most attorneys charge $150 to $300.

Add these up and you are looking at $100 to $1,100 per year in ongoing LLC costs depending on your state. The choice between an LLC and sole proprietorship often comes down to whether these recurring fees are justified by the liability protection you gain.

The filing fee gets all the attention. But several costs that come after formation tend to blindside first-time business owners. Here is what people skip in their budget:

Operating agreement -- $0 to $800. Only a handful of states legally require one (New York, California, Maine, Delaware, Missouri), but every LLC should have one. Single-member LLCs that skip this document risk losing their liability protection in court -- judges have pierced the corporate veil of LLCs with no operating agreement. You can draft one yourself using free templates, or pay an attorney $200 to $800 to customize one.

Business licenses and permits -- $50 to $500+. Your LLC is a legal entity, but it still needs permission to operate in your city or county. A general business license runs $50 to $100 in most municipalities. Industry-specific permits stack on top of that. A cleaning service might need a contractor's license. A photography business may need a sales tax permit. Check your city's business licensing department -- do not assume the LLC filing covers this.

Foreign qualification -- $100 to $300. If you form your LLC in Wyoming but actually operate in California, you will need to register as a "foreign LLC" in California. That means paying California's $70 fee plus its $800 franchise tax on top of Wyoming's fees. This double-registration trap is one of the hidden startup costs that catches people chasing low filing fees in states where they do not actually do business.

Amendments -- $25 to $100. Changed your business address? Added a new member? Most states charge a fee to amend your Articles of Organization. Budget $50 as a safe average.

The gap between the cheapest and most expensive states to run an LLC is enormous once you factor in all costs -- not just the filing fee.

Cheapest states (total first-year cost under $200):

• Kentucky -- $40 filing fee, $15 annual report. Total year one: roughly $55.
• Arkansas -- $45 filing fee, $150 franchise tax. Total year one: about $195.
• Mississippi -- $50 filing fee, no annual report fee. Total year one: around $50 plus registered agent.
• New Mexico -- $50 filing fee, no annual report, no franchise tax. Genuinely one of the cheapest states for ongoing LLC maintenance.

Most expensive states (total first-year cost over $1,000):

• California -- $70 filing fee plus $800 franchise tax. Total year one: $870 minimum, and that franchise tax hits every single year.
• Massachusetts -- $500 filing fee, $500 annual report. Total year one: $1,000 just in state fees.
• Nevada -- $425 filing fee, $150 business license, $150 annual list. Total year one: $725, which is ironic given Nevada's reputation as business-friendly.

The takeaway is straightforward. If you run a local landscaping business or consulting practice, form your LLC in the state where you live and work. Out-of-state formation only makes sense for specific situations -- holding companies, multi-state operations, or businesses seeking Delaware's specialized court system. For everyone else, your home state is almost always the right call.

You have two paths to forming your LLC: do it yourself or pay a company to handle it. Both work. The question is whether your time or your money is more valuable right now.

DIY formation: $50 to $500 (state fee only). Every state lets you file Articles of Organization directly through the Secretary of State's website. The forms are usually one to two pages. You fill in your LLC name, registered agent, business address, and member names. The whole process takes 15 to 30 minutes if you have your information ready. For a step-by-step walkthrough, see the LLC registration guide.

Formation services: $0 to $500+ on top of state fees. Companies like ZenBusiness ($0 base + state fee), LegalZoom ($0 base + state fee), and Northwest ($39 + state fee) will file for you and often bundle in extras like a registered agent year, operating agreement template, and EIN filing. The catch is the upsell. Most services aggressively push add-ons: compliance alerts ($100/year), business bank account setup ($0 but they get a referral fee), and website domains ($10 to $20/year). You do not need most of these.

Attorneys: $500 to $2,000. If your LLC has multiple members, complex profit-sharing arrangements, or intellectual property to protect, an attorney is worth the cost. They will draft a proper operating agreement and advise on tax elections. For a standard single-member LLC selling services, this is overkill.

My honest take: if you can fill out a form online and follow instructions, file it yourself. Put the $200 you saved toward actual business expenses.

Here is what a realistic first-year budget looks like for a new LLC, broken into what you will definitely pay and what you might pay depending on your situation.

Costs you cannot avoid:

• State filing fee: $50 to $500
• EIN (from IRS): $0
• Annual report (if required year one): $0 to $300
• Franchise tax (if applicable): $0 to $800

Costs you probably should pay:

• Registered agent service: $0 to $300 (free if you act as your own)
• Operating agreement: $0 to $800 (free with a template, more with an attorney)
• Business license: $50 to $400

Costs that depend on your situation:

• Formation service: $0 to $500
• Foreign qualification: $100 to $300 per additional state
• Business insurance: $300 to $2,000
• DBA filing: $10 to $100

Typical totals:

• Budget scenario (DIY in a cheap state): $100 to $300
• Mid-range scenario (formation service + registered agent): $300 to $700
• Full-service scenario (attorney + premium state + insurance): $1,500 to $3,500

Most single-member LLCs fall into that $300 to $700 range. Compared to the cost of incorporating as an S-Corp (which adds payroll setup and tax filing complexity), an LLC remains the most affordable way to get liability protection without the overhead of a corporation.