Cheapest states to form an LLC
“Cheapest” has two honest answers: the smallest check on day one, and the smallest total over the years you actually run the business. Both lists are below — they are not the same list, and the second one is the one that saves real money.
Cheapest filing fees (one-time)
| State | Filing fee | First-year total | Ongoing / yr | Recurring due pattern |
|---|---|---|---|---|
| Montana | $35 | $35 | $0 | Annual report due April 15 |
| Kentucky | $40 | $230 | $190 | Annual report due June 30 |
| Arkansas | $45 | $195 | $150 | Franchise tax report due May 1 |
| Arizona | $50 | $50 | $0 | No annual report |
| Mississippi | $50 | $50 | $0 | Annual report due April 15 |
| Missouri | $50 | $50 | $0 | No annual report |
| New Mexico | $50 | $50 | $0 | No annual report |
| Iowa | $50 | $50 | $15 | Biennial report due April 1 of odd-numbered years |
| Colorado | $50 | $75 | $25 | Periodic Report due by the end of the anniversary month |
| Michigan | $50 | $75 | $25 | Annual statement due February 15 |
Montana leads at $35, then Kentucky at $40 — though Kentucky’s $175 Limited Liability Entity Tax minimum makes its ongoing cost mid-pack. A large $50 group follows: Arizona, Colorado, Michigan, Mississippi, Missouri (online), New Mexico, and Iowa — with Arkansas just ahead of the group at $45 filed online (though Arkansas adds a $150 annual franchise tax). Wyoming at $100 with a flat $60-a-year license tax is the classic value pick: not the cheapest filing, but cheap forever.
Cheapest states to keep an LLC (ongoing cost)
| State | Filing fee | First-year total | Ongoing / yr | Recurring due pattern |
|---|---|---|---|---|
| Montana | $35 | $35 | $0 | Annual report due April 15 |
| Arizona | $50 | $50 | $0 | No annual report |
| Mississippi | $50 | $50 | $0 | Annual report due April 15 |
| Missouri | $50 | $50 | $0 | No annual report |
| New Mexico | $50 | $50 | $0 | No annual report |
| Ohio | $99 | $99 | $0 | No annual report |
| Idaho | $100 | $100 | $0 | Annual report due by the end of the anniversary month |
| South Carolina | $110 | $110 | $0 | No annual report for a default-tax-status LLC |
| Minnesota | $155 | $155 | $0 | Annual renewal due December 31 |
| Alabama | $200 | $225 | $0 | Business Privilege Tax return due annually, 2.5 months after the tax year starts |
Arizona, Missouri, New Mexico, Ohio, and South Carolina charge $0 after formation — no annual report fee at all (South Carolina’s applies to default-tax-status LLCs). Idaho, Minnesota, Mississippi, and Montana require the annual report but charge nothing for it. Over a ten-year horizon, a $0-ongoing state saves you $600 against Wyoming’s $60, $1,380 against Florida’s $138.75, and $8,000 against California’s $800 franchise tax.
Most expensive states for an LLC
The other end of the table — Massachusetts, California, Tennessee, and Maryland — explained charge by charge: See the most expensive states →
The catch: you usually must form where you operate
A cheap-state LLC is only cheap if your business genuinely lives there. If you form in Wyoming but run the business from Texas, Texas requires foreign LLC registration ($750) on top of Wyoming’s fees — the “savings” invert. The cheap-state strategy works for genuinely location-independent businesses (online-only, no office, no employees in another state) and holding structures. For a business with a storefront, staff, or inventory in one state, that state’s row in the index is your real cost — the honest comparison is then between entity types, not states: see LLC vs sole proprietorship.
Educational information only. LLC Cost Guide is not a law firm, accounting firm, or filing service, and nothing on this page is legal or tax advice. Fees and deadlines change; confirm the current figures with your Secretary of State (or Division of Corporations) before filing, and consult a licensed attorney or CPA for advice about your specific situation.