How much does it cost to start an LLC?
Short answer: $40 to $500 in unavoidable state fees, plus $0–$300 for a registered agent — and, depending on your state, $0 to $800+ every year after. Here is exactly where the money goes and where the surprises hide.
The unavoidable minimum
Every state charges a formation filing fee: $35 in Montana, $40 in Kentucky, $45 in Arkansas at the low end, up to $500 in Massachusetts and $425 in Nevada and $300 in Tennessee. This goes to the Secretary of State and there is no legal way around it. Everything else on this page is optional or state-dependent.
The cost everyone forgets: year two and beyond
Most states charge an annual or biennial report to keep your LLC active — typically $0–$150. Four states stack a real tax on top: California ($800 minimum franchise tax, every year, profit or not), Delaware ($400, raised from $300 in 2025), Rhode Island ($400 minimum), Arkansas ($150). New York adds a publication requirement (two newspapers, six weeks) that costs $500–$2,000+ depending on county.
Cheapest states to maintain: Alabama, Arizona, Delaware, Idaho, Minnesota, Mississippi — no annual report at all.
Registered agent: the $0 question
Every state requires one. In nearly all of them you can be your own for free with an in-state address. Founders pay $100–$300/year for one of two reasons: privacy (keeping a home address off public records) or no in-state address. Full decision tree here.
DIY vs formation service vs lawyer
| Route | Typical total | When it makes sense |
|---|---|---|
| DIY (state website) | state fee only | Single owner, no investors, standard business |
| Formation service | state fee + $0–$300 | You want the paperwork handled and don't have an in-state address |
| Lawyer | $500–$2,000+ | Multiple owners, unusual liability, investor money |
The “lawyer quoted me $1,800 for a $300 filing — is that normal?” posts are a fixture of founder forums. It can be normal for complex setups; it is overkill for a standard single-member LLC.
Where the advice genuinely disagrees
- S-corp election threshold. One camp says elect S-corp status once profit passes roughly $40,000–$60,000; another says wait for $65,000–$70,000. The honest answer: it depends on your state’s payroll taxes and how much you pay yourself. Below $40k profit, the payroll-filing overhead usually eats the savings.
- Which state to form in. Formation-state promoters say Delaware or Nevada or Wyoming; the operating-business answer is almost always your home state, because you will owe fees there anyway.
- Operating agreements. Single-member LLCs: some say skip it, banks and courts disagree. It costs you an hour to write one — do it.
Run the numbers for your state
Every fee below is checked against the state source linked per row. Verified 2026-11-03.