Iowa vs Montana LLC: fees, taxes, and which to pick
Data last updated: Apr 21, 2026Iowa charges $50 to form an LLC; Montana charges $35. Day-one sticker price is only part of the story, since most of the real cost comes from the annual obligations that stack up each year you keep the LLC open.
Over a rolling three-year window, Montana runs about $60 less in total state fees than Iowa. Whether that gap matters depends on whether you actually operate in one of these states or are weighing a non-resident filing.
On speed, Iowa typically clears standard online filings faster than Montana. Both states offer expedited tiers at an additional cost for filers on tight timelines.
For most small operators the choice is not really between these two states at all. It is between forming where the business actually operates and trying to route through a non-resident filing. The data below shows what each option actually costs.
Key differences at a glance
- Montana costs $15 less to form ($35 vs $50).
- Montana is $15 per year cheaper to maintain ($100 vs $115).
Where each state fits
For most filers, forming in the state you actually operate from is the right call. The side-by-side below shows where the two states meaningfully diverge.
What each state offers that the other does not
Only Montana
- No state sales tax
Both states
- Online filing
- Paid expedited tier
- No entity-level franchise or LLC tax
- No publication requirement
- Operating agreement not statutorily required
Three-year cost, side by side
Rough estimate of the state-facing cost to form and keep an LLC through three years. Both totals include a $100 per year registered-agent estimate.
Running total includes the one-time filing fee and annual ongoing costs (report fee or franchise tax plus a $100/year registered agent estimate).
What it costs under your specific situation
The table below runs the same LLC through four common scenarios. "Non-resident" rows assume a typical home-state foreign LLC registration adds about $200 per year of stacked cost; the real number depends on which state you live in and ranges from $50 to over $800 depending on jurisdiction.
| Scenario | Year 1 | Each year after | 3-year total |
|---|---|---|---|
| You live in Iowa, business operates there No foreign LLC registration needed. You pay Iowa fees only. | $165 | $115 | $395 |
| You live in Montana, business operates there No foreign LLC registration needed. You pay Montana fees only. | $135 | $100 | $335 |
| Non-resident forming in Iowa with operations elsewhere You pay Iowa's fees plus a typical home-state foreign LLC registration of about $200 per year. | $365 | $315 | $995 |
| Non-resident forming in Montana with operations elsewhere You pay Montana's fees plus a typical home-state foreign LLC registration of about $200 per year. | $335 | $300 | $935 |
Iowa vs Montana: full comparison
| Dimension | Iowa | Montana |
|---|---|---|
| Online filing Can you file the formation document online? | Yes | Yes |
| Online approval time Standard, non-expedited | 1 business day | 5 business days |
| Expedited option Paid fast-track filing | $15 | $20 |
| Annual report Required in addition to tax | Required, $30 | Required, $0 |
| State-imposed annual tax Franchise, privilege, or LLC tax minimum | None | None |
| State income tax On pass-through LLC income at member level | Yes | Yes |
| Publication requirement Newspaper publication after formation | No | No |
| Operating agreement Required by state statute | Recommended, not required | Recommended, not required |
| Foreign LLC fee Cost to register as a foreign LLC in this state | $100 | $70 |
| State sales tax General statewide rate | 6.0% | None |
Taxes in Iowa and Montana
How each state handles entity-level tax on LLCs. Pass-through classification means member-level income tax also applies at each member's residence state.
Iowa tax
No entity-level franchise tax on LLCs. State income tax applies to member-level pass-through income. Corporate rate 7.1%.
Montana tax
No entity-level franchise tax on LLCs. State income tax applies to member-level pass-through income. Corporate rate 6.8%.
Ongoing compliance
The recurring filings each state requires after formation.
Iowa
Annual report $30, due 04/01 each year. Registered agent required in Iowa.
Montana
Annual report $0, due 04/15 each year. Registered agent required in Montana.
Formation process, side by side
What actually happens from the moment you start filing to the moment you're in good standing. Use this as a checklist.
Iowa
- Check business-name availability on the Iowa entity search.
- Appoint a registered agent with a physical Iowa street address.
- File Certificate of Organization (Iowa Code 489.201) for $50.
- Wait for approval. Online typically 1 business days. Paid expedite from $15.
- Adopt an operating agreement (recommended, not required by Iowa statute).
- Apply for a federal EIN (free from the IRS).
- Open a business bank account to separate personal and business finances.
- File your first annual report and pay $30 when it comes due.
Montana
- Check business-name availability on the Montana entity search.
- Appoint a registered agent with a physical Montana street address.
- File Articles of Organization for Domestic Limited Liability Company for $35.
- Wait for approval. Online typically 5 business days. Paid expedite from $20.
- Adopt an operating agreement (recommended, not required by Montana statute).
- Apply for a federal EIN (free from the IRS).
- Open a business bank account to separate personal and business finances.
- File your first annual report and pay $0 when it comes due.
Before you pick either state
A few things that apply no matter which state you choose. These trip up enough first-time filers that they're worth stating explicitly.
Registered agent is non-negotiable. Both Iowa and Montana (and every other US state) require every LLC to designate a registered agent with a physical street address in the state of formation. You can serve as your own agent if you live in the state; otherwise a commercial agent runs $50 to $125 per year. Using your own home address makes it part of the public record.
Forming elsewhere does not escape your home state's tax. If you live and operate a business from your home state, forming the LLC in Iowa or Montana does not avoid your home state's income tax. The moment you transact business at home, your home state requires a foreign LLC registration, and state tax liability follows your residence regardless of where the entity sits on paper.
EIN applications are free. The IRS issues Employer Identification Numbers directly at no cost. Any service charging you to "get your EIN" is reselling a free form submission. Single-member LLCs with no employees technically don't need one for federal tax, but nearly every bank requires an EIN to open a business account.
Operating agreement matters more than the state you pick. A well-drafted operating agreement governs member ownership, management, profit splits, buy-sell terms, and dissolution. Without one, your LLC runs on the state's default rules, which are rarely what you want. California, Maine, Missouri, and New York require a written one by statute; every other state treats it as strongly recommended.
Agency contacts
Iowa Secretary of State, Business Services Division
- Website
- sos.iowa.gov
- Phone
- (515) 281-5204
- sos@sos.iowa.gov
- Business Services Division, Iowa Secretary of State, First Floor, Lucas Building, 321 E. 12th Street, Des Moines, IA 50319
- Office
- First Floor, Lucas Building, 321 E. 12th Street, Des Moines, IA 50319
- Hours
- 8:00 AM to 4:30 PM Central, Monday to Friday
Montana Secretary of State - Business Services Division
- Website
- sosmt.gov
- Phone
- (406) 444-3665
- sosbusiness@mt.gov
- Business Services, Montana Secretary of State, P.O. Box 202801, Helena, MT 59620-2801
- Office
- State Capitol, Room 260, 1301 6th Avenue, Helena, MT 59620
- Hours
- 8:00 AM to 5:00 PM Mountain, Monday to Friday
Iowa Department of Revenue
- Website
- revenue.iowa.gov
- Phone
- (515) 281-3114
- Iowa Department of Revenue, P.O. Box 10466, Des Moines, IA 50306-0466
- Office
- Hoover State Office Building, 1305 E. Walnut Street, Des Moines, IA 50319
- Hours
- 8:00 AM to 4:15 PM Central, Monday to Friday
Montana Department of Revenue
- Website
- mtrevenue.gov
- Phone
- (406) 444-6900
- Montana Department of Revenue, P.O. Box 8021, Helena, MT 59604-8021
- Office
- 125 N Roberts Street, Helena, MT 59601
- Hours
- 8:00 AM to 5:00 PM Mountain, Monday to Friday
Frequently Asked Questions
-
Is it cheaper to form an LLC in Iowa or Montana?
Montana is cheaper at formation ($35) than Iowa ($50). Ongoing costs are also different: $100 vs $115 per year. Total over three years: $335 vs $395.
-
Can I form an LLC in Iowa if I live in Montana?
Yes, but your Montana business will almost certainly need to register as a foreign LLC in Montana too, which means paying Montana's foreign registration fee and any ongoing Montana obligations on top of the Iowa ones. The "form elsewhere to save" math usually doesn't work for operating businesses; it only works when you have no physical operations tied to any specific state.
-
How long does it take to form an LLC in Iowa vs Montana?
Iowa online: 1 business day; Montana online: 5 business days. Iowa offers paid expedite from $15. Montana offers paid expedite from $20.
-
Which state has lower taxes for an LLC, Iowa or Montana?
Iowa: state income tax applies to member-level pass-through income, no entity-level franchise or LLC tax. Montana: state income tax applies to member-level pass-through income, no entity-level franchise or LLC tax.
-
Do both states require a registered agent?
Yes. Every US state (and DC) requires every LLC to maintain a registered agent with a physical street address in the state. Iowa and Montana both have this requirement. You can serve as your own agent if you live in the state; most out-of-state filers use a commercial agent for $50 to $125 per year.
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Which state should I pick if I run an online business from home?
Form in the state you actually live in. Your home state's Department of Revenue treats your residence as nexus regardless of where the LLC is filed, which means you owe state income tax there anyway. Forming in Iowa or Montana to escape your home state's tax doesn't work; it adds paperwork. The non-resident filings make sense when you genuinely operate nowhere in particular: international founders, purely passive holding entities, or real-estate LLCs owning property in other states.
Full state guides
More Iowa and Montana comparisons
More Iowa vs ...
Sources
- Filing fee: www.legis.iowa.gov/docs/code/489.122.pdf · verified April 21, 2026
Iowa Code 489.122(1)(c) sets the Certificate of Organization filing fee at $50. The statute lists the same $50 fee for both online (Fast Track Filing) and paper submissions; Iowa does not charge a paper surcharge for LLC formation. - Expedited filing: web.archive.org/web/20240614033842/https://sos.iowa.gov/business/Forms… · verified April 21, 2026
Iowa SOS Business Entity Forms and Fees (archived June 2024 snapshot of sos.iowa.gov/business/FormsAndFees.html; the live SOS site blocks automated access). Expedited service tiers: Two-day service $50, Five-day service $15. Preclearance service adds on top: Same-day $250, Two-day = twice the filing fee, Three-day = same as the filing fee. We report the cheapest tier (five-day, 120 hours) as the default expedited service. - Annual report fee: www.legis.iowa.gov/docs/code/489.212.pdf · verified April 21, 2026
Iowa Code 489.212 requires a biennial report between January 1 and April 1 of each odd-numbered calendar year following formation. The fee is set administratively by the SOS under 489.122(4): $30 for online Fast Track Filing, $45 for paper (per the SOS Business Entity Forms and Fees schedule archived at web.archive.org from sos.iowa.gov/business/FormsAndFees.html). - Foreign LLC registration fee: www.legis.iowa.gov/docs/code/489.122.pdf · verified April 21, 2026
Iowa Code 489.122(1)(s) sets the Application for Certificate of Registration (foreign LLC) fee at $100. Amendments to the foreign registration are also $100 under 489.122(1)(t). Foreign LLCs owe the same $30/$45 biennial report fee. - Business name search: sos.iowa.gov/search/business/search.aspx · verified April 21, 2026
Iowa SOS Business Entity Search. Confirm name distinguishability (Iowa Code 489.112) before filing the Certificate of Organization. - Operating agreement requirement: www.legis.iowa.gov/docs/code/489.105.pdf · verified April 21, 2026
Iowa Code 489.105 sets the scope, function, and limitations of the operating agreement. The chapter presumes an operating agreement governs relations among members but does not require it to be written or filed; Iowa Code 489.102(15) defines the operating agreement to include oral, implied, or written agreements. Not a written-agreement-required state. - Corporate income tax rate: revenue.iowa.gov/taxes/tax-guidance/business-income-tax/iowa-corporate… · verified April 21, 2026
Iowa Department of Revenue Corporate Income Tax Rates page. Effective January 1, 2024, the top Iowa corporate income tax rate is 7.1% on income over $100,000 (and 5.5% on income of $100,000 or less). Under House File 2317 (2022), rates are scheduled to decline further once revenue triggers are met, with a target flat rate of 5.5%. - Sales tax rate: revenue.iowa.gov/taxes/tax-guidance/sales-use-excise-tax/sales-use-tax… · verified April 21, 2026
Iowa Department of Revenue Sales and Use Tax Guide: the state sales and use tax rate is 6%. Most jurisdictions also impose a 1% local option sales tax, for a combined rate of 7% in those areas. The 6% figure is the statewide base rate. - Filing fee: sosmt.gov/business/fees/ · verified April 21, 2026
Montana SoS Business Services fee schedule: Articles of Organization filing fee = $35.00 (plus $50 per series member for a series LLC). All business filings are online-only through biz.sosmt.gov. - Expedited filing: sosmt.gov/business/fees/ · verified April 21, 2026
Expedited service: 24 hours = $20, 1 hour = $100. We record the cheapest tier (24-hour) as the default. - Foreign LLC registration fee: sosmt.gov/business/fees/ · verified April 21, 2026
Foreign LLC Certificate of Authority filing fee = $70.00 (plus $50 per series member for a series LLC). - Operating agreement requirement: archive.legmt.gov/bills/mca/title_0350/chapter_0080/part_0010/sections… · verified April 21, 2026
Montana Limited Liability Company Act, MCA Title 35, Chapter 8, does not require a written operating agreement. MCA 35-8-102 defines 'operating agreement' broadly; the statute lets the default provisions of Chapter 8 govern if no operating agreement exists. - Publication requirement: sosmt.gov/business/ · verified April 21, 2026
Montana statutes and SoS filing instructions contain no LLC publication requirement. - Annual report fee: sosmt.gov/secretary-christi-jacobsen-continues-montana-business-suppor… · verified April 21, 2026
Montana SoS announced that the annual report filing fee is waived for 2026 and 2027 for on-time filings (Jan 1 - Apr 15). Fourth consecutive year of waiver. Late filings after April 15 remain $35. Cross-referenced with the fee schedule at https://sosmt.gov/business/fees/. - Franchise tax: revenue.mt.gov/taxes/corporate-income-tax · verified April 21, 2026
Montana Department of Revenue: no franchise tax on LLCs. Only entities that elect C-corp status pay the corporate income tax, which is not a franchise tax. Pass-through LLCs owe no entity-level state tax. - Corporate income tax rate: revenue.mt.gov/taxes/corporate-income-tax · verified April 21, 2026
Montana corporate income tax: 6.75% standard rate; 7% for water's-edge election; $50 minimum tax. LLCs that default to pass-through do not owe this tax. - Sales tax rate: mtrevenue.gov/ · verified April 21, 2026
Montana has no general statewide sales tax (0%). Industry-specific taxes apply to lodging, rental cars, and a few other categories but not to general retail. - Business name search: biz.sosmt.gov/search/business · verified April 21, 2026
Montana SoS Online Business Services entity name search. Confirm name distinguishability before filing. - Online filing portal: biz.sosmt.gov/ · verified April 21, 2026
Montana SoS Online Business Services portal. Montana accepts LLC formation filings online only; mail filings are not accepted for Articles of Organization. Standard processing averages 3-6 business days; expedite tiers available.