Business Formation Costs by State

Wondering what it typically costs to form an LLC or corporation in your state? Here's a general overview of the cost categories.

The main cost categories

Formation costs generally break down into: the initial state filing fee, an optional registered agent service fee, and ongoing costs like annual reports or franchise taxes that recur every year regardless of profit.

Initial filing fees vary widely

Some states charge as little as around $50 for an LLC filing, while others charge several hundred dollars. These fees change periodically, so always confirm the current amount directly with your state's business filing agency before budgeting.

Annual and franchise taxes often surprise new owners

Many states charge a recurring annual report fee or franchise tax separate from the initial filing fee — sometimes flat, sometimes based on revenue or authorized shares. This ongoing cost is easy to overlook when comparing states by filing fee alone.

Registered agent costs

If you use a commercial registered agent rather than serving as your own, expect an additional annual fee, commonly bundled into formation service packages for the first year and then billed separately afterward.

Why 'cheapest state' isn't always the right question

A state with a low initial filing fee but incorporating out-of-state fees (if you don't live there) or a high franchise tax can end up costing more overall than simply forming in your home state. Total cost of ownership matters more than the sticker price.

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