How much does it cost to start an LLC?
State filing fees, annual report fees, franchise tax, publication requirements, and the true cost of running an LLC in every US state. Every fee below is verified against the state's own Secretary of State and tax agency, updated for 2026.
The short answer
An LLC costs the state's filing fee ($35 to $200 depending on the state) to form, plus whatever recurring state fees apply every year you keep it active. Nationally, the first year averages $129 in state fees, and recurring costs average $116/yr. Those are the two numbers to plan around.
Where people get surprised is in the hidden line items: annual report fees in 39 states, franchise tax in 10 states (California's $800 and Delaware's $300 are the biggest), publication fees in 3 states (Arizona, Nebraska, New York), and registered agent renewal fees ($99 to $249/yr) if you use a service. Your state's actual all-in cost depends on which of these apply.
What you actually pay when starting an LLC
State filing fee
One-time. Paid to the Secretary of State (or equivalent) to file the Articles of Organization (or Certificate of Formation). Range: $35 to $200. National average $129. Not negotiable.
Annual or biennial report
Recurring. 39 of 51 jurisdictions require a report. Fees range from $0 to $520 per filing period depending on the state. Average $116/yr across all states.
Franchise tax or entity tax
10 states charge LLCs an annual entity tax regardless of income. California's $800 is the most famous. Delaware's $300 is flat. Others base it on assets or members.
Publication requirement
One-time, only in Arizona (~$100), Nebraska (~$100), New York (~$1,200). Required in no other state.
Registered agent
Recurring. Free if you serve as your own agent. Services range from $99/yr (ZenBusiness) to $299/yr (Firstbase). Market median is around $125/yr. See the registered agent pillar for a full comparison.
Federal EIN
Free if you apply directly on irs.gov. $50 to $100 if a formation service files it for you. Required if the LLC has employees, multiple members, or files a separate business tax return.
Operating agreement
Free from most formation services (included in Basic tier). Around $50 à la carte if purchased separately. Not required by the state in most jurisdictions but strongly recommended everywhere.
Foreign LLC registration
One-time per additional state. If your LLC is formed in Delaware but does business in Texas, file a Certificate of Authority in Texas ($250 there). Fees range $10 to $300 per state. You also need a registered agent in each state.
Every state, cheapest first (first-year cost)
First-year cost combines the state's formation filing fee with any mandatory one-time additions (publication fee where required). Annual fees and franchise tax are separate recurring costs shown in the next column.
| State | Formation fee | First-year cost | Recurring/yr | 5-year total |
|---|---|---|---|---|
| Montana | $35 | $35 | None | $35 |
| Kentucky | $40 | $40 | $190 | $990 |
| Arkansas | $50 | $50 | $300 | $1,550 |
| Colorado | $50 | $50 | $25 | $175 |
| Iowa | $50 | $50 | $30 | $200 |
| Michigan | $50 | $50 | $25 | $175 |
| Mississippi | $50 | $50 | None | $50 |
| Missouri | $50 | $50 | None | $50 |
| New Mexico | $50 | $50 | None | $50 |
| Hawaii | $51 | $51 | $15 | $126 |
| Utah | $59 | $59 | $18 | $149 |
| California | $70 | $70 | $820 | $4,170 |
| Kansas | $85 | $85 | $90 | $535 |
| Indiana | $95 | $95 | $32 | $255 |
| District of Columbia | $99 | $99 | $550 | $2,849 |
| Ohio | $99 | $99 | None | $99 |
| Georgia | $100 | $100 | $50 | $350 |
| Idaho | $100 | $100 | None | $100 |
| Louisiana | $100 | $100 | $30 | $250 |
| New Hampshire | $100 | $100 | $100 | $600 |
| Oklahoma | $100 | $100 | $25 | $225 |
| Oregon | $100 | $100 | $100 | $600 |
| Virginia | $100 | $100 | $50 | $350 |
| West Virginia | $100 | $100 | $25 | $225 |
| Wyoming | $100 | $100 | $60 | $400 |
| Delaware | $110 | $110 | $300 | $1,610 |
| South Carolina | $110 | $110 | None | $110 |
| Connecticut | $120 | $120 | $80 | $520 |
| Florida | $125 | $125 | $139 | $819 |
| New Jersey | $125 | $125 | $75 | $500 |
| North Carolina | $125 | $125 | $200 | $1,125 |
| Pennsylvania | $125 | $125 | $7 | $160 |
| Wisconsin | $130 | $130 | $25 | $255 |
| North Dakota | $135 | $135 | $50 | $385 |
| Arizona | $50 | $150 inc. publication | None | $150 |
| Illinois | $150 | $150 | $75 | $525 |
| Maryland | $150 | $150 | $300 | $1,650 |
| Rhode Island | $150 | $150 | $450 | $2,400 |
| South Dakota | $150 | $150 | $55 | $425 |
| Minnesota | $155 | $155 | None | $155 |
| Vermont | $155 | $155 | $45 | $380 |
| Maine | $175 | $175 | $85 | $600 |
| Washington | $180 | $180 | $70 | $530 |
| Alabama | $200 | $200 | None | $200 |
| Nebraska | $100 | $200 inc. publication | $25 | $325 |
| Alaska | $250 | $250 | $100 | $750 |
| Tennessee | $300 | $300 | $400 | $2,300 |
| Texas | $300 | $300 | None | $300 |
| Nevada | $425 | $425 | $350 | $2,175 |
| Massachusetts | $500 | $500 | $500 | $3,000 |
| New York | $200 | $1,400 inc. publication | $34 | $1,570 |
The states where ongoing costs really bite
California ($800 every year)
The FTB's $800 annual franchise tax is assessed whether the LLC makes money or not. It's by far the single biggest recurring cost in the country. Formation is just $70, but five-year cost exceeds $4,000. See California LLC formation for the full tax mechanics.
Delaware ($300 every year)
Flat $300 annual LLC tax, not based on income. Formation is $110 (relatively reasonable). Ongoing tax is the highest in the country for flat franchise tax. Worth it only if Delaware-specific advantages apply to your business (more on Delaware).
Massachusetts ($500 to form, $500/yr)
The highest formation fee in the country plus a $500 annual report. Expensive all around, with no offsetting tax advantages for non-residents. Only worth it if your business is actually based in Massachusetts.
New York (publication tax)
The $200 filing fee is reasonable, but the publication requirement adds $500 to $1,800 depending on the county you're in. New York County and Kings County publications are on the high end. Unique among states, and built into the state's LLC statute (more detail).
Tennessee ($300 + per-member fees)
$300 annual report fee plus $50 per additional member. A 10-member LLC pays $750/yr. Add the Tennessee franchise/excise tax on top for LLCs that elected corporate treatment.
Nevada ($350 + business license)
Nevada's reputation as a low-tax state is misleading for LLC owners. The $350 annual Business License fee plus the $150 Annual List fee means $500/yr minimum on top of any state tax. Nevada has no state income tax, which is the real draw.
Where the "free LLC" claim comes from
Services like Bizee, ZenBusiness, and Inc Authority advertise a "$0 LLC" or "free formation" tier. What they mean: the service itself charges nothing to prepare and submit your Articles of Organization. You still pay the state's filing fee directly. Free-tier LLCs end up costing exactly the state fee for year one.
The catch with free tiers is usually the upsell path. Year-one registered agent is typically bundled free, but the year-two renewal charges $119 to $249 depending on the provider. EIN filing and operating agreements are often paid add-ons on the free tier. A $0 Basic tier plus a $99 EIN add-on plus a $99 OA add-on lands at the same all-in cost as a mid-tier package. Read the fine print on year-two renewal specifically, because that's where "free" becomes a recurring subscription.
Out-of-state formation math
It's tempting to form an LLC in Delaware or Wyoming because of their reputations as business-friendly states with low fees. For most small operators, this is a trap. If you live in New York and form in Delaware to "save money," you still have to register the LLC as a foreign entity in New York (that's the state where the business actually operates), which costs more than forming directly in New York. You also pay registered agent fees in both states.
Out-of-state formation makes sense only when specific advantages apply: holding companies that own intellectual property and want Delaware's Chancery Court; privacy-focused owners using Wyoming's anonymous LLC structure (see Wyoming); multi-state operators who already need foreign registrations everywhere and want a neutral home-state tax regime. For a solo consulting business, the home state is the right answer 95% of the time.
Frequently Asked Questions
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How much does it cost to start an LLC?
State filing fees range from $35 in Montana to $200 in New York. The national average formation fee across all 51 jurisdictions is $129. That is just the state's filing fee. Depending on your state, you also pay an annual report fee ($116/yr on average), a franchise tax in 10 states, and publication fees in 3 states.
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What's the cheapest state to form an LLC?
By first-year cost, Montana at $35 is the cheapest state. Over five years of ownership, Montana at $35 total wins because it has no recurring annual fees. Keep in mind: "cheapest to form" rarely means "cheapest to operate." If your business is based in a different state, the cheapest formation state is still your home state, because registering as a foreign LLC in your actual state of operation costs more than forming at home.
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What's the most expensive state?
Massachusetts at $500 has the highest formation fee by itself. But California at $4,170 is the most expensive over five years because of high recurring costs. California's $800 annual franchise tax and New York's publication requirement (typically $500 to $1,800 depending on the county) are the two biggest five-year cost drivers nationally.
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Are there any hidden costs when starting an LLC?
Yes. Beyond the state filing fee, budget for a registered agent service ($99 to $249/yr), EIN filing if a service does it for you ($50 to $100, or $0 if you do it yourself on irs.gov), an operating agreement (free from most services or around $50 à la carte), and optional foreign LLC registration if you operate outside the state of formation ($10 to $300 per additional state). Publication in Arizona, Nebraska, New York is a real cost not captured in the state filing fee.
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Do I pay the LLC cost every year, or just once?
The formation fee is one-time. Everything else is recurring. 39 of 51 jurisdictions require an annual or biennial report with a fee (average $116/yr). 10 states also charge a franchise tax or equivalent annual entity tax. Plus registered agent service renews every year if you use one. Budget for the recurring side, not just the initial filing.
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Can I start an LLC for free?
No state charges $0 for formation. The cheapest is Montana at $35. Some formation services (Bizee, ZenBusiness, Inc Authority) advertise "free LLC formation," meaning they charge $0 for their service on top of the state fee. You still pay the state fee directly. Expect a registered agent upsell at checkout that recurs annually.
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Is an LLC cheaper than a corporation?
In most states, slightly. LLC formation fees average $129 vs $100 to $300 for a corporation in typical states. Bigger differences show up in ongoing costs: LLCs usually have simpler annual reports, lower franchise taxes (except in Delaware and California), and no required corporate formalities like board meetings or share issuance. For the vast majority of small businesses, an LLC costs less to run than a corporation.
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Does a formation service add to the cost?
Only for their own service fee. Services like Bizee and ZenBusiness charge $0 for Basic formation; Northwest is $39 to $100; LegalZoom ranges $0 to $349 depending on the tier. On top of the service fee, the state's filing fee is the same whether you use a service or file directly at the Secretary of State. A service mainly saves you time on paperwork and bundles year-one registered agent. See the full service comparison for 2026 pricing.