What is the cheapest state to form an LLC in?

Over five years, Arizona, Mississippi, Missouri and New Mexico tie as the cheapest at $50 each in total state charges. Arizona's $50 is the state's charge alone. It leaves out the newspaper notice, for which the state publishes no rate. An LLC needs that notice unless its statutory agent's street address is currently in Maricopa or Pima County, where the state posts it online for free. Montana has the lowest one-time filing fee at $35, but over five years it costs $115, because a low entry fee and a low running cost are not the same thing. Montana's $0 annual report fee is a temporary waiver, not a permanent price. It holds for reports filed on or before 15 April 2027, and the fee is $20 from 16 April 2027. Five-year totals on this site charge $20 for each report due after that date. That said, the cheapest state is only the right answer if you actually live or operate there. See the next question.

Should I form my LLC in the cheapest state even if I live elsewhere?

Almost never. Doing business in your home state with an out-of-state LLC generally requires registering that LLC as a foreign LLC where you operate, so you pay two states' filing fees, two states' annual reports, and a registered agent in the formation state you have no presence in. A registered agent alone averages about $125 a year, which typically exceeds the entire filing-fee saving in year one. The states worth forming in remotely are the ones where you genuinely have no home-state nexus at all.

Which states charge no annual report fee at all?

7 states require no periodic report: Alabama, Arizona, Delaware, Missouri, New Mexico, Ohio, and South Carolina. Be careful reading that as free, though, several of them levy a state entity-level tax instead, which is collected by the revenue department rather than the Secretary of State and is missing from most fee comparisons.

How much does the state you choose actually matter?

Across five years the gap between the cheapest and most expensive state is $4,070, $50 in Arizona, Mississippi, Missouri and New Mexico against $4,120 in California. That is real money, but for most single-state businesses it is not a genuine choice: your home state is where you have nexus. The decision matters most for holding companies, fully remote founders with no fixed base, and non-US founders.

Does a cheap filing fee mean a cheap LLC?

No, and that is the single most common mistake in state-selection advice. A filing fee is paid once; report fees and entity-level taxes are paid every year for as long as the LLC exists. The comparison table below ranks each state on filing fee and on five-year total side by side, and several states move dozens of places between the two.

The Cheapest States to Form an LLC

Ranked on five years of actual state charges. Filing fee, recurring report fees, and minimum entity-level taxes, rather than the one-time filing fee everyone quotes.

By Edmond Hui · Fees verified July 29 to October 29, 2026

Measured over five years of real state charges, Arizona, Mississippi, Missouri and New Mexico tie as the cheapest states to run an LLC in at $50 each. Arizona's $50 is the state's charge alone. It leaves out the newspaper notice, for which the state publishes no rate. An LLC needs that notice unless its statutory agent's street address is currently in Maricopa or Pima County, where the state posts it online for free. Montana has the lowest one-time filing fee ($35), which is the number most comparisons quote, and it is not the same answer: over five years it costs $115. The full spread from cheapest to most expensive is $4,070 over five years. Montana's $0 annual report fee is a temporary waiver, not a permanent price. It holds for reports filed on or before 15 April 2027, and the fee is $20 from 16 April 2027. Five-year totals on this site charge $20 for each report due after that date.

$50Cheapest 5-year, 4 states tied

$4,120Priciest 5-year, California

$648.05National average, 5 years

$4,070Cheapest-to-priciest spread

Five-year LLC cost comparison across 50 states: Arizona, Mississippi, Missouri and New Mexico tie as cheapest at $50 each, the 50-state average is $648.05, and California is priciest at $4,120. — Ranked on total five-year state cost (filing fee plus five years of recurring charges), not the one-time filing fee alone. Source: MyStateLLC 50-state cost dataset, verified against each Secretary of State's published fee schedule, July 2026.

The 10 cheapest states over five years

State charges only. Registered-agent service is excluded because it is a commercial product, not a state fee.

#	State	Filing fee	Per year after	5-year total
1	Arizona	$50	$0/yr	$50
1	Missouri	$50	$0/yr	$50
1	Mississippi	$50	$0/yr	$50
1	New Mexico	$50	$0/yr	$50
5	Ohio	$99	$0/yr	$99
6	Idaho	$100	$0/yr	$100
7	South Carolina	$110	$0/yr	$110
8	Hawaii	$51	$12.50/yr	$113.50
9	Montana	$35	$0/yr	$115
10	Iowa	$50	$15/yr	$125

Tied totals share a rank. Arizona's $50 is the state's charge alone. It leaves out the newspaper notice, for which the state publishes no rate. An LLC needs that notice unless its statutory agent's street address is currently in Maricopa or Pima County, where the state posts it online for free.

Where a cheap filing fee is misleading

Ranking states by filing fee and by five-year total produces two different answers. These are the states that move furthest between the two rankings, a positive gap means the state looks cheaper to enter than it is to stay in, and a negative gap means the opposite.

State	Filing fee	Rank on filing fee	Rank on 5-year cost	Places moved
Kentucky $175 Limited Liability Entity Tax (LLET)	$40	2	42	+40 worse
Arkansas	$45	3	40	+37 worse
California $800 Annual LLC Tax (minimum franchise tax)	$70	13	50	+37 worse
Nevada $200 State Business License	$75	14	45	+31 worse
Minnesota	$155	41	12	29 better
Alabama	$200	44	18	26 better
Maryland	$100	18	44	+26 worse
Texas	$300	48	22	26 better

The 10 lowest filing fees

This is the ranking most comparisons publish. Useful if you only care about the cost of getting started, but check the five-year column before deciding.

#	State	Filing fee	5-year total
1	Montana	$35	$115
2	Kentucky	$40	from $990
3	Arkansas	$45	$795
4	Arizona	$50	$50
4	Colorado	$50	$175
4	Iowa	$50	$125
4	Michigan	$50	$175
4	Missouri	$50	$50
4	Mississippi	$50	$50
4	New Mexico	$50	$50

Why forming in a cheap state usually costs you more

The saving in these tables is only available to someone who has no home-state nexus. If you live in one state and form in another, you generally have to register the out-of-state LLC as a foreign LLC where you actually operate. At that point you are paying both states' filing fees, filing both states' annual reports, and paying a registered agent in a state where you have no address, roughly $125 a year on its own.

The saving on a filing fee is usually gone inside twelve months. The people for whom out-of-state formation genuinely pays are holding companies with no operations, founders with no fixed base, and non-US founders with no US nexus.

What foreign qualification costs in your state · Best state for your specific situation · Compare two states over five years

States with no annual report at all

7 states require no periodic report to stay in good standing. That removes a recurring deadline as well as a recurring fee, but check the entity-tax column, because a state can drop the report and still charge a minimum tax.

State	Filing fee	Per year after	Entity-level tax
Alabama	$200	$0/yr	None
Arizona	$50	$0/yr	None
Delaware	$110	$400/yr	$400 Annual LLC Tax (alternative entity tax)
Missouri	$50	$0/yr	None
New Mexico	$50	$0/yr	None
Ohio	$99	$0/yr	None
South Carolina	$110	$0/yr	None

The five most expensive states

State	Filing fee	Per year after	5-year total
California	$70	$810/yr	$4,120
Massachusetts	$520	$520/yr	$3,120
Rhode Island	$150	$450/yr	$2,400
Tennessee	$300	from $400/yr	from $2,300
Delaware	$110	$400/yr	$2,110

Methodology

The fees were verified from July 29 to October 29, 2026 against primary sources only. Each state's official Secretary of State fee schedule, the governing statute, and where a state-level tax applies, the state revenue or franchise tax authority. No commercial formation-service or blog sources were used, and figures a state does not publish are excluded rather than estimated.

Rankings use the five-year total. Filing fee plus five years of recurring charges, because it is both the more honest measure and the one that avoids the question of whether a given state's first report falls in year one or year two. Biennial report fees are annualised by halving. Where a state has a dated fee change on record, each of the five years is charged at the fee in force when that year's report is due, for an LLC formed on the day the figures were last computed. Tied totals share a rank. Registered-agent service is excluded from every figure. Ranked states: 50.

Full per-state detail, including paper-filing rates, expedite options, and late penalties, is on each state's own page, linked from every table above and from the 50-state cost table.

Cite this study

This dataset is free to republish under a Creative Commons Attribution (CC BY 4.0) license. Journalists and researchers are welcome to cite the figures with a link back.

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Citation

MyStateLLC Cheapest States to Form an LLC (2026). All 50 states ranked on total five-year LLC cost. Source: each state's official Secretary of State fee schedule and revenue authority. Available at: https://www.mystatellc.com/research/cheapest-state-to-form-an-llc

Attribution HTML

<p>Source: <a href="https://www.mystatellc.com/research/cheapest-state-to-form-an-llc">MyStateLLC Cheapest States to Form an LLC</a>, based on each state's official Secretary of State fee schedule and revenue authority.</p>

Frequently Asked Questions

: Over five years, Arizona, Mississippi, Missouri and New Mexico tie as the cheapest at $50 each in total state charges. Arizona's $50 is the state's charge alone. It leaves out the newspaper notice, for which the state publishes no rate. An LLC needs that notice unless its statutory agent's street address is currently in Maricopa or Pima County, where the state posts it online for free. Montana has the lowest one-time filing fee at $35, but over five years it costs $115, because a low entry fee and a low running cost are not the same thing. Montana's $0 annual report fee is a temporary waiver, not a permanent price. It holds for reports filed on or before 15 April 2027, and the fee is $20 from 16 April 2027. Five-year totals on this site charge $20 for each report due after that date. That said, the cheapest state is only the right answer if you actually live or operate there. See the next question.
: Almost never. Doing business in your home state with an out-of-state LLC generally requires registering that LLC as a foreign LLC where you operate, so you pay two states' filing fees, two states' annual reports, and a registered agent in the formation state you have no presence in. A registered agent alone averages about $125 a year, which typically exceeds the entire filing-fee saving in year one. The states worth forming in remotely are the ones where you genuinely have no home-state nexus at all.
: 7 states require no periodic report: Alabama, Arizona, Delaware, Missouri, New Mexico, Ohio, and South Carolina. Be careful reading that as free, though, several of them levy a state entity-level tax instead, which is collected by the revenue department rather than the Secretary of State and is missing from most fee comparisons.
: Across five years the gap between the cheapest and most expensive state is $4,070, $50 in Arizona, Mississippi, Missouri and New Mexico against $4,120 in California. That is real money, but for most single-state businesses it is not a genuine choice: your home state is where you have nexus. The decision matters most for holding companies, fully remote founders with no fixed base, and non-US founders.
: No, and that is the single most common mistake in state-selection advice. A filing fee is paid once; report fees and entity-level taxes are paid every year for as long as the LLC exists. The comparison table below ranks each state on filing fee and on five-year total side by side, and several states move dozens of places between the two.

Edmond Hui · Founder, MyStateLLC

Edmond Hui is a software engineer and serial entrepreneur based in New York who has founded multiple online businesses across e-commerce, media, and information publishing. Before transitioning into tech, he spent years as a commercial real estate professional closing deals totaling over 100,000 square feet, giving him firsthand experience with business formation and entity structuring. He built MyStateLLC to provide the free, state-specific LLC guidance he wished existed when forming his own companies.

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