LLC Filing Fees

By Joe Stone

Filing fees are an important consideration when you decide to form an LLC, or limited liability company. Each state has its own requirements for LLCs, and the filing fees related to LLCs vary greatly among the states in amount and type of fees charged. These fees do not include service fees charged by private companies that provide LLC filing services.

State Filing Fees

All states require a document to be filed with a government agency to form an LLC, usually called the articles of organization, certificate of registration or certificate of formation. The government agency involved is typically at the state level, such as the Secretary of State in Massachusetts or the Division of Revenue in New Jersey; Alabama requires the document to be first filed with a county probate judge before being transmitted to the Secretary of State. A filing fee is always required for this document, with each state setting it own fees, which can range from $40 in Alabama to $500 in Massachusetts. In addition to the Alabama Secretary of State filing fee, a fee is also charged by the county probate judge, which is a minimum of $35.

Publication Fees

In addition to requiring articles of organization to be filed with a state agency, the LLC laws in several states also require the LLC's organizers to publish a notice of intent to form an LLC. This requirement entails publishing certain information from the LLC’s articles of organization in a newspaper within a specific geographical area of circulation, usually the county in which the LLC’s principal place of business is located. The notice must appear at least once a week for a set number of weeks, and depending upon the required number of publications and location of the LLC, fulfilling this requirement can be quite expensive. For example, New York LLC law requires the LLC’s articles of organization to be published once per week in two different newspapers for six weeks. If the LLC is located in New York County (Manhattan), the publications fees can be more than $1,000.

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Annual Filing Fees

In most states, the initial filing fee to form the LLC is not the last. Yearly filing fees are also required, which are referred to by various names. For example, Massachusetts requires LLCs to file an annual report that, like the initial filing fee, includes a $500 fee. In California, the Secretary of State filing fee for an LLC’s articles of organization is only $70; however, a franchise tax fee must also be paid at the same time to the Franchise Tax Board in the amount of $800. This fee must be paid annually and is in addition to any income taxes the LLC may owe.

Service Fees

It is fairly common to find private companies in every state advertising on the Internet and elsewhere that offer LLC filing services. In addition to the state filing fees, these companies will also charge a service fee, and these service fees are not regulated and can be set at any amount. Because of the variation in state LLC filing fees, it is important to know the breakdown of any fees charged by a private company above what the required state fee is. The state fees are easily verifiable with the state agency responsible for regulating the formation of an LLC.

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The Cost of Setting Up an LLC

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Year End Checklist for an LLC

Operating a limited liability company requires the completion of certain tasks on an annual basis. Most of those tasks relate to reporting to government agencies including the IRS and state and local governments in which the LLC operates. While the checklist may appear tedious and, at times, overly burdensome, the annual obligations of an LLC are significantly less than the annual obligations of a corporation.

The Cost of Forming an LLC

Because LLCs (limited liability companies) are creations of the state rather than the federal government, official costs to form an LLC vary. Most states charge fees that are similar to the charges for registering a new corporation. Some states, however, choose to set their fees notably less or more than new corporation costs. You may also face other expenses for retaining expert assistance from an experienced attorney and/or accountant to set up your LLC properly.

How to Set Up an LLC in South Carolina

You set up an LLC in South Carolina by filing a document called Articles of Organization that complies with the requirements of the South Carolina Uniform Limited Liability Company Act of 1996. Setting up a South Carolina LLC is easy; however, determining the legal and tax consequences of operating your business as an LLC are not. Information is available from the South Carolina Secretary of State to assist you in setting up your LLC. It may be in your best interest to obtain advice from a lawyer or tax adviser regarding whether this is the right entity for your business.

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