When starting a Limited Liability Company (LLC) in the United States, one of the most common questions is: how much does it cost to form an LLC? The answer depends largely on your state, the type of business you run, and optional services you choose. In this article, we’ll break down the exact costs you should expect in 2025, including state filing fees, annual fees, registered agent costs, and optional services. All sources cited below are from official U.S. government websites.
Initial Filing Fee
The Articles of Organization (or Certificate of Formation) must be filed with your state’s Secretary of State to officially create your LLC. This is the most essential and non-negotiable cost.
- State fees range from $40 to $500, depending on where you register.
- The most affordable states include Kentucky ($40) and Arizona ($50).
- Expensive states include Massachusetts ($500) and Tennessee ($300).
You can find your state’s specific fee structure through the National Association of Secretaries of State:
🔗 NASS Business Entity Filing Fees
Annual Reports and Franchise Taxes
Most states require LLCs to file an annual report or pay an annual franchise tax, even if the company made no income.
- California charges a minimum annual tax of $800.
- Delaware requires an annual franchise tax of $300 for LLCs.
- Florida requires an annual report filing fee of $138.75.
Failing to file your annual report on time may result in penalties or administrative dissolution of your LLC.
Check your state’s ongoing requirements using this IRS resource:
🔗 IRS State Government Tax Agencies
Registered Agent Costs
Every LLC must designate a registered agent—an individual or business responsible for receiving legal documents.
- If you act as your own agent, there is no cost.
- If you hire a professional registered agent service, expect to pay $100–$300 per year.
Some states, like Wyoming, allow you to serve as your own registered agent only if you reside there. Non-residents forming LLCs in another state usually need to hire a professional service.
You can verify the agent requirements by state through the U.S. Small Business Administration:
🔗 SBA – Register Your Business
Optional Costs
These are not required by the government but are commonly purchased for convenience or legal protection:
1. Operating Agreement
- Some states require this internally, but it’s often not filed.
- You can draft it yourself for free or pay $50–$200 to have it done professionally.
2. Employer Identification Number (EIN)
- Free from the IRS directly
🔗 Apply for an EIN
Avoid companies that charge for EINs—they are unnecessary.
3. Name Reservation
- Optional in most states
- Typically costs $10 to $50 to reserve your LLC name before filing
Example: Total Cost by State
Let’s look at an example breakdown in three states:
California
- Filing: $70
- Franchise Tax: $800
- Annual Report: $20
Total first-year cost: ~$890
Florida
- Filing: $125
- Annual Report: $138.75
Total first-year cost: ~$263.75
Wyoming
- Filing: $100
- Annual Report: $60
Total first-year cost: ~$160
Conclusion: What Should You Budget?
On average, expect to pay:
- $50–$500 upfront for state filing
- $60–$800 annually in recurring fees
- $0–$300/year for a registered agent
- Optional extras like an operating agreement or name reservation
Always check your specific state’s Secretary of State website and avoid third-party sites with hidden service fees. Use only official government portals when possible.
If you’re planning to start an LLC in 2025, budgeting properly and understanding these costs will help you stay compliant and avoid surprise expenses.