Cheapest Way to Start an LLC (Form Your Budget Business)

While establishing a limited liability company (LLC) offers notable benefits, like safeguarding personal assets and providing peace of mind, entrepreneurs often encounter the burden of accumulating costs.

If you seek the cheapest way to start an LLC, our team of financial advisors can help you proficiently navigate the complexities of initial filing fees, registered agent services, and LLC formation documents.

We will also explore potential avenues to reduce expenses, such as assuming the role of your own registered agent and identifying states with more affordable LLC filing options.

With careful planning, the dream of becoming a business owner need not be an expensive one. Let’s explore the specifics!

Brief Overview

  • Forming an LLC can be made affordable with careful planning and cost-cutting strategies.
  • The cost to form an LLC varies with factors such as location, business nature, and additional fees for specific licenses and permits.
  • While seeking the cheapest way, it’s crucial to consider the quality of services and long-term implications for the company.

What is the Cheapest Way to Get an LLC?

The cheapest way to form an LLC is to do it yourself or hire an LLC service that offers a free formation package. The second option is the most convenient, as it saves you from having to file the required LLC forms yourself.

LLC Formation – What Options Do You Have?

When it comes to LLC formation, there are mainly three options available, each with its own unique set of advantages and costs. So, let’s delve into these options to better understand which one might be the best fit for your business aspirations.

DIY: Forming an LLC on Your Own

The cheapest way to start an LLC is to handle the process yourself. This includes choosing your business name, filing the necessary articles of organization for your LLC, paying the state filing fees, and setting up your LLC bank account.

It’s a process that requires careful attention to detail and a good understanding of the legal requirements in your state. But it can save money on professional services.

Legal Assistance for LLC Formation

If you’re not comfortable going through the process on your own, legal services can ensure that your LLC paperwork is filed correctly and help you navigate the complexities of business structure and tax purposes.

However, this is not necessarily the cheapest way to form an LLC, with legal fees potentially adding hundreds or even thousands of dollars to the cost. According to Legal Match, the typical hourly fees of a business lawyer range from $150 to $325.

Use an Incorporation Service for LLC Setup

Companies like ZenBusiness and Northwest offer services that guide you through the LLC opening process. They handle the paperwork and file it on your behalf.

While these services do charge a fee, our careful evaluation of the topic revealed that they can be less expensive than hiring a lawyer. See our list of the cheapest LLC formation services in the United States.

How Much Does It Cost to Form an LLC?

The costs associated with forming an LLC vary based on factors such as location and the nature of the business. Let’s dive into the main expenses you should expect when you form an LLC.

1. Filing Taxes

The cost of filing taxes for a single-partnership or multi-member LLC can vary depending on the size and complexity of your company. Currently, an initial formation fee typically ranges from $35 to $520. However, this is a one-time expense.

The subsequent annual reports fee varies among states, with a median range of $0 to $800.

2. Business Licensing and Permit Fees

Depending on the nature of your business and where it’s located, you might need to pay for a specific business license or permit. For example, a restaurant might need a health permit, a liquor license, and a signage permit. These costs can range from $50 to $400 each.

3. Publication Fees in Specific States (Arizona, Nebraska, and New York)

In certain states like Arizona, Nebraska, and New York, you are required to publish a notice of your LLC formation in a local newspaper. The publication fees can run from $40 to $2000.

4. Optional Fees: LLC Name Reservation and Fictitious Name (DBA Name) Fees

LLC name reservation fees are optional and vary by state, typically costing between $10 and $50. If you intend to operate your business under a name that is different from the legal name of your LLC (a DBA, or “doing business as” name), you might need to pay a DBA filing fee which typically ranges from $10 to $100.

Ways to Cut Costs

In forming a limited liability company (LLC), the costs can sometimes be a deterrent. Fortunately, while evaluating this subject, we identified 2 ways to reduce these expenses and make the process more affordable.

Filing in a State Where the Fees are Cheaper

One of the most effective ways to cut costs when forming an LLC is to consider filing in a state where the filing fees are cheaper. For example, the initial state filing fee for an LLC in Montana is only $35, compared to $520 in Massachusetts.

This means business owners can save considerably by choosing to create their business entity in a state with lower filing fees.

Act as the Registered Agent Yourself

Another cost-saving measure is to act as the registered agent for your LLC. Hiring a registered agent service can add hundreds of dollars to your startup costs. By taking on this role yourself, you can avoid these fees.


Establishing an LLC serves as a crucial initial move for aspiring entrepreneurs, providing both asset protection and tax management flexibility.

To raise money in the early stages, consider filing the Articles of Organization in states with a cheaper initial filing fee, such as Montana, as it can help generate funds for your new venture.

It’s important to note that as your new business starts functioning, additional LLC costs may arise, including obtaining an Employer Identification Number (EIN) from the Internal Revenue Service and printing costs for your corporate kit.

However, partnering with a reliable incorporation service like ZenBusiness, with an A+ rating on BBB and a free LLC filing package, can simplify the process, saving you time and money.


Are There Any Ongoing Costs Associated With Maintaining an LLC?

Yes, most states require LLCs to file an annual report and pay an annual fee. Additionally, you may need to pay for a registered agent service if you don’t want to serve as your own registered agent.

Are There Any Hidden Costs or Fees I Should Be Aware of When Starting an LLC?

While the filing fees are the most significant cost, you should also budget for any business licenses, permits, or additional services you may need, such as an EIN (Employer Identification Number) from the IRS.


Thomas Wilson

Thomas Wilson

An accomplished business guru, our CEO holds a degree from Philadelphia's esteemed Fox School of Business, accredited by AACSB. With a knack for practicality, they've orchestrated the launch of diverse small enterprises and guided fellow entrepreneurs in optimizing their ventures. Trust their seasoned insights for invaluable advice tailored to new businesses and LLCs.