Running an LLC involves more than just the initial filing fee. Most states require ongoing annual fees to keep your limited liability company in good standing. These fees vary dramatically from state to state, ranging from $0 in some states to over $800 in others.
Understanding your state’s annual fee requirements is crucial for budgeting and staying compliant. Missing these payments can result in administrative dissolution, loss of liability protection, and additional reinstatement fees.
What Are LLC Annual Fees?
LLC annual fees are recurring charges imposed by state governments to maintain your LLC’s active status. These fees go by different names depending on your state:
- Annual Report Fee (most common)
- Franchise Tax (Delaware, California)
- Registration Fee (some states)
- Renewal Fee (various states)
Regardless of the name, these fees serve the same purpose: keeping your LLC registered and in good standing with the state.
Key Point: Annual fees are separate from income taxes. Your LLC will still need to file tax returns even in states with no annual fees.
LLC Annual Fees by State
Here’s a comprehensive breakdown of annual fees across all 50 states and the District of Columbia:
States with No Annual Fees
These states don’t charge annual fees for LLCs:
- Arizona: $0 annual fee
- Delaware: $0 annual fee (but $300 franchise tax)
- Indiana: $0 annual fee
- Iowa: $0 annual fee
- Kentucky: $0 annual fee
- Michigan: $0 annual fee
- Mississippi: $0 annual fee
- New Mexico: $0 annual fee
- Ohio: $0 annual fee
- South Dakota: $0 annual fee
- Wisconsin: $0 annual fee
- Wyoming: $0 annual fee
Low Annual Fee States ($25 or Less)
These states charge minimal annual fees:
- Alabama: $25
- Arkansas: $25
- Idaho: $0 (but $20 every 5 years)
- Kansas: $25
- Montana: $20
- Nebraska: $25
- Nevada: $25
- North Dakota: $25
- Oklahoma: $25
- Utah: $20
Moderate Annual Fee States ($26-$100)
Most states fall into this category:
- Alaska: $100
- Colorado: $25
- Connecticut: $80
- Florida: $138.75
- Georgia: $50
- Hawaii: $15
- Illinois: $75
- Louisiana: $35
- Maine: $85
- Maryland: $100
- Minnesota: $25
- Missouri: $45
- New Hampshire: $100
- New Jersey: $75
- New York: $25
- North Carolina: $25
- Oregon: $100
- Pennsylvania: $70
- Rhode Island: $50
- South Carolina: $10
- Tennessee: $50
- Texas: $0 (no annual report required)
- Vermont: $35
- Virginia: $50
- Washington: $60
- West Virginia: $25
High Annual Fee States ($100+)
These states charge substantial annual fees:
- California: $800 (franchise tax)
- Delaware: $300 (franchise tax)
- District of Columbia: $300
- Massachusetts: $500
California Alert: California’s $800 annual franchise tax is due even if your LLC made no income. This fee applies to all LLCs, regardless of activity level.
Source: Secretary of State offices for all 50 states and DC, verified March 2026
Additional Considerations
Filing Deadlines
Annual fees come with strict deadlines. Common due dates include:
- Anniversary of formation: Many states require payment on your LLC’s anniversary date
- Calendar year-end: Some states use December 31 or January 31 deadlines
- State fiscal year: A few states align with their fiscal year calendar
Missing deadlines typically results in late fees ranging from $25 to $100, and continued non-payment can lead to administrative dissolution.
Professional LLCs
Some states charge higher fees for professional LLCs (PLLCs) that provide licensed services like law, medicine, or accounting. California, for example, may have different requirements for professional entities.
Multi-State Operations
If your LLC operates in multiple states, you’ll need to register as a foreign LLC in each additional state. This means paying annual fees in every state where you’re registered. Delaware LLCs operating nationwide often face this multi-state fee burden.
Ready to form your LLC in a low-fee state? Start your LLC formation today for $39 + state fees →
Strategies for Managing Annual Fees
Choose Your Formation State Wisely
If you’re a single-state business, forming in a state with low or no annual fees can save hundreds annually. Wyoming and several other states offer $0 annual fees with business-friendly laws.
Set Up Automatic Reminders
Most Secretary of State offices send renewal notices, but don’t rely solely on these. Set up calendar reminders 60 days before your due date to ensure timely payment.
Consider Formation Services
Many LLC formation companies offer compliance services that track and remind you of annual fee deadlines. Northwest Registered Agent provides compliance monitoring as part of their registered agent service.
What Happens If You Don’t Pay?
Failing to pay annual fees has serious consequences:
- Late fees: Additional penalties ranging from $25-$100
- Loss of good standing: Your LLC becomes non-compliant
- Administrative dissolution: The state dissolves your LLC
- Loss of liability protection: Personal asset protection may be compromised
- Reinstatement costs: Additional fees to restore your LLC
Important: Even if dissolved, you may still owe back taxes and fees. Always address non-compliance issues promptly.
Budgeting for Your LLC
When planning your LLC budget, factor in:
- Annual state fees
- Registered agent fees (if using a service)
- Business license renewals
- Professional memberships or certifications
- Accounting and bookkeeping costs
For comprehensive business financial management, consider using professional accounting software. FreshBooks offers simple, intuitive accounting designed specifically for small businesses and LLCs, making it easy to track these ongoing expenses.
Keep your LLC finances organized from day one. Try FreshBooks free for 30 days →
Frequently Asked Questions
Do I need to pay annual fees if my LLC isn’t active?
Yes, in most states you must pay annual fees regardless of business activity. Even dormant LLCs typically owe these fees. California’s $800 franchise tax, for example, applies to all LLCs whether they generate revenue or not.
Can I deduct LLC annual fees on my taxes?
Annual fees paid to maintain your LLC’s legal status are generally deductible as business expenses. However, consult with a tax professional for guidance specific to your situation, as tax laws can be complex.
What’s the difference between annual fees and franchise taxes?
The terms are often used interchangeably, but technically franchise taxes are fees for the privilege of doing business in a state, while annual fees are administrative costs for maintaining registration. Both serve similar purposes and are typically due annually.
Conclusion
LLC annual fees vary dramatically by state, from $0 in business-friendly states like Wyoming and Delaware to $800 in California. Understanding these costs upfront helps you make informed decisions about where to form your LLC and how to budget for ongoing compliance.
Remember that while annual fees are an important consideration, they shouldn’t be the only factor in choosing your formation state. Consider your business needs, tax implications, and operational requirements alongside fee structures.
This information is for educational purposes only and does not constitute legal or financial advice. Filing fees and requirements change : always confirm current fees with your state’s Secretary of State office.