How Much Does It Cost to Start an LLC?
The cost to start an LLC typically ranges from $50 to $300 for state filing fees, but the total cost can vary depending on your state, whether you use a service, and any ongoing compliance requirements. This guide breaks down all the costs involved so you know exactly what to expect.
Minimum Cost to Start an LLC
At a minimum, you must pay your state’s filing fee to form an LLC.
Typical State Filing Fees
Low-cost states: $50–$100
Mid-range states: $100–$200
Higher-cost states: $200–$300+
This is the only required upfront cost in most states if you handle everything yourself.
Cost Breakdown: What You May Pay
While the filing fee is mandatory, there are several other potential costs to consider.
1. State Filing Fee (Required)
This is the fee to file your Articles of Organization or Certificate of Formation.
One-time cost
Paid to your state government
Required to legally create your LLC
2. Registered Agent Cost (Optional but Common)
Every LLC must have a registered agent.
Cost Options
Acting as your own agent: $0
Professional service: typically $100–$200 per year
Using a service provides privacy and ensures you don’t miss important legal notices.
See our registered agent service to stay compliant.
3. LLC Formation Service Fees (Optional)
If you use a formation service, you will pay an additional fee.
Typical Service Costs
Basic packages: $0–$100 (plus state fees)
Mid-tier packages: $100–$300
Premium packages: $300+
What You Get
Document preparation and filing
Registered agent (sometimes included)
Compliance reminders
Learn more about whether you should start an LLC yourself or use a service.
4. Operating Agreement (Optional)
An operating agreement is strongly recommended, even if not required.
Cost Range
Free (DIY templates)
$50–$200 (paid templates or services)
Higher if customized by an attorney
This document helps define ownership and operations.
5. EIN (Free)
An Employer Identification Number (EIN) is free if you apply directly through the IRS.
Avoid Paying for This
Some services charge $50–$100 for EIN registration, but you can do it yourself at no cost.
6. Business Licenses and Permits (Varies)
Depending on your industry and location, you may need licenses.
Cost Range
$0–$500+ depending on requirements
Examples include:
Local business licenses
Sales tax permits
Professional licenses
Ongoing Costs of an LLC
Starting your LLC is only part of the cost. You’ll also need to budget for ongoing expenses.
1. Annual Reports
Many states require annual or periodic reports.
Cost: $0–$300+ per year
2. Franchise Taxes
Some states charge annual taxes regardless of income.
Example: California requires a minimum $800 annual tax
3. Registered Agent Renewal
If using a service:
Typically $100–$200 per year
4. Business Maintenance Costs
Accounting or bookkeeping
Tax preparation
Compliance tools
Learn more about annual report requirements to stay compliant.
Cheapest Way to Start an LLC
If you want to minimize costs, you can start an LLC very affordably.
Low-Cost Strategy
File directly with your state
Act as your own registered agent
Use free templates for your operating agreement
Apply for your EIN yourself
Estimated Total Cost
$50–$300 depending on your state
Learn more about the cheapest way to start an LLC step-by-step.
Most Expensive Scenarios
Costs increase when you add services or operate in certain states.
Higher-Cost Situations
Using premium formation services
Operating in states with high annual fees (e.g., California)
Hiring attorneys for custom documents
Managing multiple LLCs
In these cases, startup costs can reach $500–$1,000+.
State-by-State Cost Differences
Your location has a major impact on cost.
Lower-Cost States
Kentucky
New Mexico
Mississippi
Higher-Cost States
California (due to franchise tax)
New York (due to publication requirement)
However, you should usually form your LLC in the state where you operate.
Cost vs Value: Is It Worth It?
While there are costs involved, forming an LLC provides significant value.
What You Get
Personal liability protection
Business credibility
Flexible tax options
Structured business operations
For most business owners, the protection alone justifies the cost.
Common Mistakes That Increase Costs
Using unnecessary upsell services
Paying for EIN registration
Filing in the wrong state
Missing deadlines and paying penalties
Not budgeting for ongoing costs
Avoiding these mistakes can save hundreds of dollars.
Frequently Asked Questions
What is the cheapest cost to start an LLC?
The cheapest cost is typically your state’s filing fee, which can be as low as $50 depending on the state.
Can I start an LLC for free?
No. You must pay the state filing fee, but you can minimize other costs by doing most steps yourself.
What is the most expensive part of an LLC?
Ongoing costs—such as franchise taxes or annual fees—are often the most expensive over time.
Do I need to pay yearly for an LLC?
In most states, yes. You may need to file annual reports or pay ongoing fees.
Is it worth paying for an LLC service?
It depends on your priorities. Services offer convenience and reduce errors, but they increase upfront costs.
Plan Your LLC Costs the Right Way
Starting an LLC is relatively affordable, but understanding the full cost—both upfront and ongoing—is key to avoiding surprises.
If you want to keep costs low, you can handle most steps yourself. If you prefer convenience and added support, a professional service can help ensure everything is done correctly while keeping your business compliant.
