Search "how much does an LLC cost" and you'll see confident answers ranging from "$50" to "$500." Both are wrong. The upfront filing fee is only one line item in a stack of ongoing costs that vary wildly by state — annual reports, franchise taxes, publication requirements, registered agent services, and business licenses. In some states, your true first-year LLC cost is under $150. In others, it's over $2,500 before you've made a single sale.
This is the full breakdown of what LLC formation actually costs in 2026, state by state. For the step-by-step formation process itself, start with our complete LLC formation guide.
The five cost buckets you actually need to plan for
Every LLC has five distinct cost categories. Skip any of them in your planning and you'll be surprised by the total. Here they are:
- State filing fee — one-time, at formation
- Annual/biennial report fees — recurring
- Franchise tax or LLC tax — recurring, usually annual
- Registered agent service — recurring, if not DIY
- Additional requirements — publication, licenses, professional fees
Let's break each down.
State filing fees: the sticker price
This is the fee to file your Articles of Organization. It's the number you see advertised. Range: $40 to $500.
Cheapest filing fees
- Kentucky — $40
- Arkansas — $45 online / $50 paper
- Iowa — $50
- Mississippi — $50
- Missouri — $50 (also $0 annual!)
- Michigan — $50
- New Mexico — $50
Most expensive filing fees
- Massachusetts — $500
- Tennessee — $300 (higher for larger member counts)
- Illinois — $150 (see Illinois business formation)
- Texas — $300 (see Texas business formation)
- California — $70 filing but see franchise tax below (California business formation)
- New York — $200 filing plus publication (New York business formation)
Annual and biennial fees: the ongoing bite
Almost every state charges a recurring fee to keep your LLC in good standing. Miss the deadline and your LLC gets administratively dissolved — a painful and expensive recovery.
States with no annual report fee
- Missouri — no annual report or fee
- Ohio — no annual report
- New Mexico — no annual report
- Arizona — no annual report (but publication required at formation)
- South Carolina — no annual report
Modest annual fees ($10-$60)
- Kentucky — $15 annual
- New York — $9 biennial statement (but see franchise tax and publication)
- Colorado — $10 periodic report
- Georgia — $50 annual
- Utah — $18 annual
Substantial annual fees ($200+)
- Massachusetts — $500 annual report
- Nevada — $150 annual report + $200 business license = $350/year
- Tennessee — $300+ annual (based on member count)
- Illinois — $75 annual
Franchise taxes: the invisible killer
Franchise taxes are annual taxes on the privilege of doing business as an LLC — separate from income tax. Some are flat, some are gross-receipts based, some scale with capital. This is where costs really diverge.
California — the notorious $800 minimum
California charges an $800 annual franchise tax minimum on every LLC, regardless of profit. On top of that, an LLC with $250,000+ in gross receipts pays an additional gross receipts fee ($900-$11,790). This alone is why many small businesses form in Wyoming or Delaware despite operating in California — though "foreign qualification" to do business in California still triggers the tax if you're actually operating there. See California business formation for the full picture.
Delaware — flat $300 franchise tax
Delaware's flat $300 annual LLC franchise tax is one reason it's a popular formation state.
Texas — margin tax exemption for small LLCs
Texas franchise (margin) tax has a "no tax due" threshold — LLCs with less than $2.47M in revenue owe nothing but still must file. Above that, rates apply.
New York — publication tax and biennial fee
New York's biennial fee is only $9, but publication is often a $2,000+ hit.
Other franchise tax states
- Alabama — $50 min business privilege tax
- Arkansas — $150 franchise tax
- Georgia — no LLC franchise tax
- Illinois — no LLC franchise tax (corporation only)
- Nevada — no franchise tax but state business license $200
Registered agent costs: DIY vs. service
Every state requires a registered agent — a person or company with a physical address in the state to receive legal documents. You have two options:
Serve as your own registered agent — $0
If you live in your formation state and have a physical address (not a P.O. box) where you can reliably receive mail during business hours, you can serve as your own agent. Downsides: your address becomes public record, you must be available during business hours, and if you're served with a lawsuit, it happens in front of clients or family.
Commercial registered agent service — $100-$300/year
Services like Northwest Registered Agent, ZenBusiness, and Harbor Compliance handle receipt of legal documents, keep your address private, and forward mail. Costs typically $100-$300/year. Nearly always worth it if you have a home-based business or operate in multiple states.
Publication requirements: New York, Arizona, Nebraska
Three states require newly formed LLCs to publish notice in local newspapers. This can be trivial or brutal depending on where you file.
New York — the worst by far
You must publish notice in two newspapers designated by the county clerk for six consecutive weeks. In Manhattan and Brooklyn, this can cost $1,500-$2,000+. In upstate counties, it's often $200-$400. Some formation services offer "publication address" workarounds using a registered agent's address in a cheap county. See our New York business formation page for details.
Arizona — 3-week publication
Publish notice in an approved newspaper for 3 consecutive weeks in the county of your statutory agent's address. Typically $30-$200.
Nebraska — publication required
Similar 3-week requirement, generally $40-$150.
Additional real costs everyone forgets
Business licenses
State LLC approval doesn't include local business licenses. Depending on your business type and location, you'll need city licenses ($25-$500+), county licenses, and often industry-specific licenses (contractor, professional, food service). See our business licenses guide for the layered requirements.
EIN — free from IRS, $50-$100 if you use a service
Getting an EIN from the IRS is free at IRS.gov. Formation services charge $50-$100 to do it for you.
Operating agreement — free template or $500+ attorney draft
Most states don't require an operating agreement, but every LLC should have one. Templates are widely available. For multi-member LLCs or unusual structures, a $500-$1,500 attorney draft is worth it. See our operating agreement guide.
Business bank account minimums
Some business banks require minimum deposits ($100-$2,500) or charge monthly fees ($10-$25) if you don't meet balance requirements.
Formation service fees
If you use LegalZoom, ZenBusiness, Northwest, or similar: $0-$300+ on top of state fees. Compare on features and upsells, not just base price.
Real total first-year cost by state
Adding it all up for a solo LLC using commercial registered agent ($125/year assumed) but no formation service:
Cheapest states (under $250 first year)
- Kentucky — $40 filing + $15 annual + $125 RA = $180
- New Mexico — $50 filing + $0 annual + $125 RA = $175
- Missouri — $50 filing + $0 annual + $125 RA = $175
- Arizona — $50 filing + $100 publication + $0 annual + $125 RA = $275
- Ohio — $99 filing + $0 annual + $125 RA = $224
Mid-range ($400-$800 first year)
- Florida — $125 filing + $138.75 annual + $125 RA = $389 (Florida)
- Texas — $300 filing + $0 franchise tax (under threshold) + $125 RA = $425 (Texas)
- Delaware — $110 filing + $300 franchise tax + $125 RA = $535
- Illinois — $150 filing + $75 annual + $125 RA = $350 (Illinois)
Most expensive first-year states
- California — $70 filing + $800 franchise tax + $20 SOI + $125 RA = $1,015 (California)
- New York City — $200 filing + ~$1,800 publication + $9 biennial + $125 RA = $2,134 (New York)
- Massachusetts — $500 filing + $500 annual + $125 RA = $1,125
- Nevada — $75 filing + $350 annual (report + license) + $125 RA = $550
- Tennessee — $300 filing + $300 annual + $125 RA = $725
How to actually minimize LLC costs
If cost is your primary constraint:
- Form in your operating state. If you operate in California, forming in Wyoming doesn't help — you'll still have to foreign-qualify in California and pay both states.
- Serve as your own registered agent if you have a stable home address and no privacy concerns. Save $125/year.
- Skip the formation service. Filing directly with the Secretary of State takes 30 minutes and saves $100-$300. Follow our LLC formation guide.
- Draft your own operating agreement from templates. Use our operating agreement guide.
- Get your EIN directly from IRS for free.
- Understand your state's fee structure BEFORE filing. Some are much friendlier to small LLCs than the sticker price suggests.
Bottom line
The "cheap $99 LLC" is marketing. Real first-year costs range from $175 (New Mexico or Missouri, self-service) to $2,100+ (New York City with publication). Ongoing annual costs range from $0 (Missouri) to $800+ (California franchise tax).
The right formation state depends on where you actually operate — not where the fees are lowest. For most founders, forming in your home state is right despite higher fees. For the full decision framework — formation state, entity type, tax election — see our how to form an LLC guide, LLC vs S-Corp guide, and how to start a business guide.