Starting a Limited Liability Company (LLC) is one of the most common ways entrepreneurs protect their personal assets and operate a business legally in the United States. However, one of the first questions people ask is:
“How much does it cost to start an LLC?”
The answer depends on the state where you register your company. Each state sets its own filing fees and ongoing compliance costs.
In this guide, we will explain:
- Initial LLC filing costs
- Ongoing annual fees
- A full state-by-state LLC cost table (2026)
- Common LLC cost questions
By the end of this guide, you will clearly understand how much money you need to start and maintain an LLC.
Initial LLC Filing Fee
When forming an LLC, every state requires you to pay a formation filing fee. This is a one-time payment submitted when you file your LLC formation documents with the state government.
In most states, the document used to create an LLC is called:
- Articles of Organization
- Certificate of Organization
- Certificate of Formation
- Certificate of Registration
Although the names may vary, the purpose is the same:
This document officially registers your business with the state.
The filing fee varies widely across the United States. Some states charge as little as $35, while others can charge $500 or more.
Ongoing LLC Fees (Annual or Biennial Reports)
Forming an LLC is not a one-time expense. Most states require businesses to submit periodic reports to keep their LLC active and compliant.
These recurring fees are commonly known as:
- Annual Report
- Biennial Report
- Annual Franchise Tax
- Annual LLC Fee
- Information Report
The purpose of these reports is to update the state with important information such as:
- Business address
- Registered agent details
- Ownership information
Failure to submit these reports can lead to:
- Late penalties
- Loss of good standing
- Administrative dissolution of the LLC
LLC Cost by State (2026)
LLC formation costs vary significantly across states. As of 2026, the average cost to form an LLC in the United States is about $132.
Below is a simplified overview of formation and annual fees in different states.
| State | Filing Fee | Annual / Ongoing Fee |
|---|---|---|
| Alabama | $200 | $50 per year |
| Alaska | $250 | $100 every 2 years |
| Arizona | $50 | No annual fee |
| Arkansas | $45 | $150 per year |
| California | $70 | $800 per year |
| Colorado | $50 | $25 per year |
| Delaware | $110 | $300 per year |
| Florida | $125 | $138.75 per year |
| Georgia | $110 | $60 per year |
| Illinois | $150 | $75 per year |
| Kentucky | $40 | $15 per year |
| Massachusetts | $500 | $500 per year |
| Michigan | $50 | $25 per year |
| Missouri | $50 | No annual fee |
| Montana | $35 | $20 per year |
| Nevada | $425 | $350 per year |
| New Mexico | $50 | No annual fee |
| New York | $200 | $9 every 2 years |
| Ohio | $99 | No annual fee |
| Texas | $300 | $0 for most LLCs |
| Utah | $59 | $18 per year |
| Virginia | $100 | $50 per year |
| Washington | $200 | $60 per year |
| Wisconsin | $130 | $25 per year |
| Wyoming | $100 | $60 minimum per year |
Some Entrepreneurs Use Formation Services
Because the LLC formation process can sometimes feel complicated, many entrepreneurs prefer to get professional assistance to handle the paperwork and avoid mistakes.
If you want expert help, our team at TaxPills LLC can guide you through the entire process and make sure everything is filed correctly.
We help business owners with:
- LLC formation and registration
- EIN application guidance
- Registered agent setup
- Compliance and filing support
If you’d like help starting your LLC quickly and correctly, you can contact our team directly on WhatsApp.
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Important Note About Choosing a State
Many entrepreneurs try to form an LLC in a cheaper state to save money. However, this strategy often backfires.
For example, if you live in California but form an LLC in Wyoming, you will likely still need to register that company as a Foreign LLC in California.
This means you may end up paying fees in two states instead of one.
In most situations, the best option is to form your LLC in the state where you live or operate your business.
Cheapest States to Start an LLC
Some states have particularly low startup costs.
Examples include:
- Montana – $35 filing fee
- Kentucky – $40 filing fee
- Arizona – $50 filing fee
- New Mexico – $50 filing fee with no annual report
However, cost alone should not determine where you form your LLC.
Frequently Asked Questions About LLC Costs
Do LLCs Pay Taxes?
LLCs themselves usually do not pay federal income tax. Instead, profits pass through to the owners and are reported on their personal tax returns.
However, LLCs may still be responsible for:
- Self-employment taxes
- State income taxes
- Sales taxes
- Employment taxes (if they have employees)
Do I Have to Pay LLC Fees Every Year?
Yes. Most states require an annual or biennial report fee to maintain your LLC’s good standing.
Missing these payments can lead to penalties or even closure of the LLC.
Can You Start an LLC for Free?
In most states, forming an LLC requires a state filing fee, so it is rarely free.
However, you can reduce costs by filing the paperwork yourself instead of hiring a formation service.
Which State Is the Cheapest to Open an LLC?
States like Montana, Kentucky, and New Mexico have some of the lowest LLC formation fees.
Still, the cheapest state may not always be the best choice for your business.
Can I Be My Own Registered Agent?
Yes. In most states, you can serve as your own registered agent as long as you have a physical address in the state where the LLC is registered.
How Long Does It Take to Get an LLC Approved?
Approval times depend on the state and filing method. Online filings can take 1–5 business days, while mailed applications may take several weeks.
How to Start an LLC (Simple Steps)
Starting an LLC generally involves these steps:
- Choose a unique business name
- Select the state where you want to form your LLC
- File Articles of Organization with the state
- Appoint a registered agent
- Create an LLC operating agreement
- Apply for an EIN from the IRS
- Open a business bank account
How much does it cost to start an LLC in the United States?
The cost of forming an LLC varies by state. Filing fees typically range from $35 to $500, with the average cost around $132. Some states also charge annual maintenance fees.
What state has the cheapest LLC filing fee?
Some of the cheapest states to start an LLC include:
- Montana – around $35
- Kentucky – around $40
- Arizona – around $50
- New Mexico – around $50
However, choosing a state solely because it is cheap may create additional registration requirements.
Do all states require an annual LLC fee?
Most states require LLCs to file an annual or biennial report. These reports update the state about the company’s information and usually include a filing fee.
What happens if I don’t pay the LLC annual fee?
If you fail to submit your annual report or pay the required fee, the state may:
- Charge late penalties
- Suspend your LLC
- Administratively dissolve the business
Can I form an LLC in another state to avoid taxes?
Not usually. If you live or operate in one state but register your LLC in another, you may need to file as a foreign LLC in your home state, which can increase costs instead of reducing them.
Which states are popular for forming LLCs?
Some states are known for business-friendly regulations, including:
- Delaware
- Wyoming
- Nevada
However, these states are usually most beneficial for large companies or multi-state businesses.
