Starting a Limited Liability Company (LLC) is a smart move for many entrepreneurs, thanks to the flexible structure and liability protection it offers. However, many new business owners are surprised by the ongoing costs of maintaining an LLC—especially the annual fees, which vary significantly from one U.S. state to another. In this 2025 guide, we’ll break down everything you need to know about LLC annual fees, including what they are, how much they cost in each state, what happens if you don’t pay, and tips to stay compliant without breaking the bank.
What Are Annual LLC Fees?
Annual fees for LLCs are recurring costs you must pay to the state government to keep your company legally active. These fees typically include an Annual Report fee, a Franchise Tax, or sometimes both. The purpose is to ensure the state keeps your company’s information current and to generate tax revenue. Missing these payments can lead to late fees, penalties, or even dissolution of your LLC.
Types of Annual LLC Fees
There are typically three types of fees you might encounter depending on your state:
- Annual/Biennial Report Fees – A standard fee required to file updated information about your LLC, such as address and ownership.
- Franchise Taxes – A fee charged for the privilege of operating a business in that state, often based on income, assets, or net worth.
- Registered Agent Fees – If you’re using a third-party registered agent, you’ll typically pay $50–$300 annually.
LLC Annual Fees by State (2025 Overview)
Here’s a quick breakdown of annual fees by popular states for LLCs:
- California: $800 franchise tax + $20 statement of information
- Delaware: $300 flat annual franchise tax
- Florida: $138.75 annual report fee
- Texas: No annual report fee, but franchise tax applies if revenue exceeds $2.47M
- New York: $9–$4,500 filing fee depending on income + biennial statement ($9)
- Wyoming: $60 annual report or $0.0002 per asset value in WY
- Nevada: $150 annual list + $200 business license
- Washington: $60 annual report
- Illinois: $75 annual report + $250 franchise tax
- Arizona: No annual fee or report (one of the cheapest)
For a full table of all 50 states, check the official IRS State Links.
Can I Avoid Paying LLC Annual Fees?
Unfortunately, no. These fees are mandatory if you want your LLC to remain active and in good standing. However, you can minimize costs by choosing a state with low or no fees like Arizona, New Mexico, or Wyoming. Just remember—choosing a state only to save fees may not be smart if you’re physically doing business in a different one. Doing so can lead to foreign qualification fees, which may cost more in the long run.
What Happens If You Don’t Pay Your LLC Annual Fees?
If you skip your annual fees, the state may:
- Charge late fees and interest
- Revoke your good standing status
- Dissolve your LLC entirely, making it illegal to operate
- Leave you personally liable for debts or lawsuits
That’s why it’s essential to keep track of due dates and set reminders well in advance.
Tips to Stay Compliant Without Overspending
- Use a free calendar app like Google Calendar to mark renewal dates
- Choose a state with transparent and low-cost fee structures
- Consider using a compliance service like ZenBusiness or Northwest Registered Agent for automatic filing reminders
- If you’re running your LLC alone, you may be able to serve as your own registered agent in some states to save money
Final Thoughts
Understanding and budgeting for annual LLC fees is a crucial part of responsible business ownership. Whether you’re running a side hustle or managing a growing e-commerce brand, these fees can sneak up on you if you’re not prepared. Before forming your LLC, take the time to research your state’s requirements and build the costs into your yearly business budget. Want help comparing states or staying compliant year after year? I’d be happy to create a custom checklist or walk you through it step by step.
Need Help Choosing the Best State or Creating a Compliance Plan?
📩 Just let me know your business type and whether you’re inside or outside the U.S.—I’ll guide you through the smartest setup for your LLC.