See 5-year total cost of forming an LLC in all 50 states — find the cheapest
Sample selection — popular formation states. Adjust as needed.
Includes formation fee, annual reports, franchise tax, and registered agent for 5 years.
| Rank | State | Form | Report | Franchise | 5-Year |
|---|---|---|---|---|---|
| #1 | Arizona | $50 | — | None | $550 |
| #2 | Missouri | $50 | — | None | $550 |
| #3 | New Mexico ⭐ | $50 | — | None | $550 |
| #4 | Indiana | $90 | $0/2yr | None | $590 |
| #5 | Colorado ⭐ | $50 | $10/yr | None | $600 |
| #6 | Idaho | $100 | — | None | $600 |
| #7 | Iowa | $50 | $30/2yr | None | $610 |
| #8 | South Carolina | $110 | — | None | $610 |
| #9 | Montana | $35 | $20/yr | None | $635 |
| #10 | Minnesota | $155 | $0/yr | None | $655 |
LLC filing fees range from $40 (Kentucky) to $500 (Massachusetts). Enter your state to see filing fees, annual report costs, and total first-year expenses.
FreeToolHub LLC Cost Comparison is a free browser-based tool that compares LLC formation costs across all 50 states, no signup.
LLC formation fees, annual report fees, and franchise taxes are based on state Secretary of State data as of Jan 2026. Registered agent fees are market averages ($100-150/yr). Fees change — always verify with your state's SOS website before filing.
About this tool
Where is the cheapest state to form an LLC? Compare all 50 states. Free, 2026 accurate.
What Is the LLC Cost Comparison Tool?
The LLC Cost Comparison Tool shows the total 5-year cost of forming and maintaining an LLC in any US state. It includes formation fees, annual/biennial report fees, franchise taxes, and registered agent costs for all 50 states plus DC. Whether you are choosing between Wyoming, Delaware, New Mexico, or your home state, this tool helps you see the true cost of ownership — not just the filing fee.
Who Should Use This Tool?
This tool is for entrepreneurs, freelancers, small business owners, and online sellers deciding where to form their LLC. If you are starting an e-commerce store, a consulting business, a dropshipping operation, or a holding company, state choice impacts your costs significantly. It is especially useful for digital nomads and remote business owners who can choose any state.
How Does This Tool Work?
Select up to 5 states to compare side by side. The tool calculates: (1) Formation fee — the one-time cost to file Articles of Organization with the state. (2) Annual or biennial report fees — ongoing compliance costs. (3) Franchise tax — some states charge an annual franchise tax (CA: $800 minimum, DE: $300, NV: $350). (4) Registered agent fees — required in all states, typically $100-150/year. The 5-year total shows your true cost of ownership, not just the initial filing fee.
Wyoming vs Delaware vs New Mexico: Which Is Cheapest?
Wyoming: $100 formation + $60/yr report + $100/yr agent = ~$860 for 5 years. No franchise tax, no state income tax. Best for small online businesses. Delaware: $90 formation + $300/yr franchise tax + $100/yr agent = ~$2,590 for 5 years. Best for startups seeking VC funding or going public. New Mexico: $50 formation + $0 annual report + $100/yr agent = ~$550 for 5 years. Cheapest overall, strong privacy (no public member list). Best for solo owners prioritizing cost and privacy. California: $70 formation + $800/yr franchise tax (minimum) + $20 biennial report = ~$4,170 for 5 years. Most expensive. Only choose if you operate in CA.
Frequently asked
Which state is cheapest to form an LLC?
New Mexico is the cheapest state for an LLC at approximately $550 total over 5 years ($50 formation, no annual report fee, $100/yr registered agent). Wyoming is second at ~$860, and Kentucky is third at ~$665. Avoid California ($800/year franchise tax minimum), Massachusetts ($500/year), and Delaware ($300/year franchise tax) if cost is your primary concern.
Do I need to form my LLC in the state where I live?
No. You can form an LLC in any state. However, if your business operates in your home state (physical office, employees, significant sales), you may need to foreign-qualify your out-of-state LLC, which adds filing fees ($50-750) and a second registered agent. For purely online businesses with no physical presence, forming in a low-cost state like Wyoming or New Mexico is common.
What is a registered agent and do I need one?
A registered agent is a person or company designated to receive legal documents (lawsuits, subpoenas, state notices) on behalf of your LLC. Every state requires one. The agent must have a physical address in the state of formation. You can be your own agent if you live in the state, but most owners use a professional service ($100-150/year) for privacy and compliance.
What is a franchise tax?
A franchise tax is an annual fee some states charge for the privilege of operating an LLC or corporation in that state. Not all states have one. California has the highest ($800/year minimum), followed by Delaware ($300/year), Nevada ($350/year), and Illinois ($300/year). States like Wyoming, New Mexico, Texas (for LLCs), and Florida have no franchise tax for LLCs.
Should I form my LLC in Wyoming or Delaware?
Wyoming is better for small online businesses: lower cost ($100 formation, no franchise tax, $60/year report), strong asset protection, and no state income tax. Delaware is better for startups planning to raise venture capital or go public: it has the most business-friendly court system (Court of Chancery) and investors prefer Delaware entities. For most solo founders and small businesses, Wyoming is the more cost-effective choice.
What happens if I do not file my annual report?
Most states will administratively dissolve your LLC if you fail to file annual reports or pay franchise taxes. This means your LLC loses its limited liability protection, and you become personally liable for business debts. Reinstatement is possible but involves additional fees. Some states (New Mexico, Arizona, Missouri) do not require annual reports, reducing compliance burden.
Can I form an LLC myself or do I need a lawyer?
You can form an LLC yourself by filing Articles of Organization with your state's Secretary of State and paying the formation fee. The process typically takes 1-7 business days. However, services like Northwest Registered Agent, LegalZoom, or ZenBusiness can handle the filing for you ($39-299 plus state fees) and include a first year of registered agent service, which saves time and ensures compliance.
Does an LLC protect my personal assets?
Yes, an LLC provides limited liability protection, meaning your personal assets (home, car, personal bank accounts) are generally protected from business debts and lawsuits. However, this protection can be pierced if you commingle personal and business funds, fail to maintain proper records, or personally guarantee a business debt. Always maintain a separate business bank account.
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