Key Takeaways
- LLCs separate personal and business assets and offer flexible taxation (default pass-through, with optional S-corp/C-corp elections).
- Choose your home/operating state unless you have a clear reason to form elsewhere; otherwise you may need foreign qualification and duplicate compliance.
- Online formation is straightforward if you follow the steps: name, registered agent, Articles of Organization, and post-registration tasks.
Understanding LLC
A Limited Liability Company (LLC) is a state-chartered entity that protects owners (“members”) from most business liabilities and is taxed by default as a pass-through (members report profits/losses on personal returns).
You can elect S-corporation or C-corporation treatment if that better fits compensation or reinvestment goals.
For multi-member LLCs, the default tax classification is a partnership; for single-member LLCs, a disregarded entity.
An election under IRS Form 8832 or IRS Form 2553 can convert to corporate or S-corp status.
In an S-corporation election, owner-employees must receive reasonable W-2 wages, while the remaining profits are distributed as dividends.
C-corp LLCs may also pay dividends in addition to salaries to shareholder-employees.
Compensation note: In a default-taxed LLC, members typically take distributions or guaranteed payments.
Different Types of LLC
Choosing the right LLC structure helps align liability, management, and tax options with your goals.
1. Single-Member LLC (SMLLC)
One owner. Simple governance; by default taxed as a disregarded entity. (See tax refresher above for elections.)
2. Multi-Member LLC
Two or more owners. Default partnership taxation.
Management can be member-managed (all owners run the business) or manager-managed (appointed managers).
3. L3C (Low-Profit LLC)
Mission-first variant recognized in a handful of states (e.g., Vermont, Wyoming, Illinois, Michigan).
Operates like an LLC but designed to attract program-related investments.
4. Series LLC
A “parent” with separate series/cells that isolate assets and liabilities.
Available only in certain states (e.g., Delaware, Illinois, Nevada, Texas, Tennessee, Utah).
Confirm bank/insurer acceptance before choosing this format.
Note
Note
Series LLCs are not uniformly recognized for federal tax purposes; the IRS evaluates each series case by case.
5. PLLC (Professional LLC)
For licensed professions (e.g., doctors, lawyers, architects, accountants) in states that allow it.
A PLLC doesn’t shield members from personal malpractice—only from general business debts.
6. Restricted LLC (Nevada only)
Estate-planning tool that prohibits distributions for 10 years after formation (must be designated in the Articles of Organization). Not tax-exempt.
7. Privacy-Focused (“Anonymous”) Filing
Some states (e.g., Delaware, Nevada, New Mexico, Wyoming) keep owners off public filings (registered agent shown instead). This protects public anonymity but not regulatory disclosure obligations.
For federal and banking disclosures, see the privacy/BOI note in Step 1.
How to Set Up Your LLC Online
Starting a Limited Liability Company (LLC) online can be simple if each step is followed carefully. Below are five key steps to help guide someone through registering an LLC remotely.
Step 1: Choose the Right State to Start the LLC
Pick the state that best fits how and where you will actually operate (online, physical location, or both).
If you form in one state but do business in another, you’ll usually need foreign qualification in the operating state (extra filings, agent, and fees).
For Delaware, note strong case law, no sales tax, and a flat LLC tax of $300 due June 1; late payment triggers a $200 penalty + 1.5% per month interest.
Also remember Delaware’s separate Gross Receipts Tax on business receipts (a business-level tax distinct from sales tax).
For online businesses, factor sales/use tax nexus and compliance; for holding or location-agnostic entities, compare total maintenance (annual/biennial reports, franchise/gross-receipts taxes, agent).
For Arizona LLCs, there is no annual report, but most counties require a newspaper publication of formation (addresses in Maricopa or Pima are exempt because the Commission posts online).
Note
Privacy note (“anonymous filings”)
States like Delaware, Wyoming, New Mexico, and Nevada generally keep owners off public filings (registered agent appears instead). However, under FinCEN’s March 26 2025 interim rule, domestic U.S. reporting companies are temporarily exempt from BOI filing pending final regulations, while foreign reporting companies must still report under the revised deadlines. Always check FinCEN’s current guidance for updates.
To help you plan, here are the initial filing fee and recurring fee figures you provided (keep in mind states update fees).
| State | Filing Fee | Annual/Biennial Fee | Notes |
|---|---|---|---|
| Alabama | $200 | $50/year | — |
| Alaska | $250 | $100 every 2 years | — |
| Arizona | $50 | $0 | No annual LLC report; most counties require newspaper publication (Maricopa/Pima exempt via online posting). |
| Arkansas | $45 | $150/year | — |
| California | $70 | $800/year + $20 every 2 years | — |
| Colorado | $50 | $25/year | — |
| Connecticut | $120 | $80/year | — |
| Delaware | $110 | $300/year | LLC tax due June 1; late = $200 penalty + 1.5%/month interest. Gross Receipts Tax may apply to business receipts. |
| Florida | $125 | $138.75/year | Annual report due May 1; after May 1 late fee applies. |
| Georgia | $100 | $50/year | — |
| Hawaii | $50 | $15/year | — |
| Idaho | $100 | $0 (info report required) | — |
| Illinois | $150 | $75/year | — |
| Indiana | $95 | $31 every 2 years | — |
| Iowa | $50 | $30 every 2 years | — |
| Kansas | $160 | $50/year | — |
| Kentucky | $40 | $15/year | — |
| Louisiana | $100 | $35/year | — |
| Maine | $175 | $85/year | — |
| Maryland | $100 | $300/year | Annual report (SDAT) typically due April 15. |
| Massachusetts | $500 | $500/year | — |
| Michigan | $50 | $25/year | — |
| Minnesota | $155 | $0 (info report required) | — |
| Mississippi | $50 | $0 (info report required) | — |
| Missouri | $50 | $0 | — |
| Montana | $35 | $20/year | — |
| Nebraska | $100 | $13 every 2 years | Due Apr 1 in odd years; delinquent date varies by page (June 1 or June 16—state site lists both; local practice accepts June 16). |
| Nevada | $425 | $350/year | $425 is the combined state business license + initial list typical at formation. |
| New Hampshire | $100 | $100/year | — |
| New Jersey | $125 | $75/year | — |
| New Mexico | $50 | $0 | No annual LLC report. |
| New York | $200 | $9 every 2 years | Biennial statement $9; separate LLC publication requirement applies after formation. |
| North Carolina | $125 | $200/year | — |
| North Dakota | $135 | $50/year | — |
| Ohio | $99 | $0 | No annual report for LLCs. |
| Oklahoma | $100 | $25/year | — |
| Oregon | $100 | $100/year | — |
| Pennsylvania | $125 | $7/year | New annual report regime; LLCs due Sept 30. |
| Rhode Island | $150 | $50/year | — |
| South Carolina | $110 | $0 | Unless taxed as S-Corp. |
| South Dakota | $150 | $50/year | — |
| Tennessee | $300 | $300/year | — |
| Texas | $300 | $0 | PIR/OIR required; no-tax-due threshold $2.47M, no “No-Tax-Due Report” filing. |
| Utah | $59 | $18/year | — |
| Vermont | $155 | $45/year | — |
| Virginia | $100 | $50/year | — |
| Washington | $200 | $60/year | — |
| Washington DC | $99 | $300 every 2 years | Biennial report. |
| West Virginia | $100 | $25/year | — |
| Wisconsin | $130 | $25/year | — |
| Wyoming | $100 | $60 minimum/year | Annual license tax based on WY assets; minimum $60. |
Note
Tip
Don’t pick a state just because it’s cheaper. If you operate your business from another state, you might end up paying double to stay compliant.
Step 2: Pick a Business Name
Your entity name (legal name) must be available in the state, include a designator (e.g., LLC or L.L.C.), and avoid restricted terms (e.g., bank, university) without approvals.
A DBA (Doing Business As) is for branding under a different public name and must also be registered where required.
Step 3: Appoint a Registered Agent
Most states require a registered agent with a physical in-state address who is available during business hours to accept service of process and official mail. Some states maintain lists of commercial registered agents; owners can serve as their own agent if they meet the rules.
Step 4: File the Articles of Organization
File the Articles of Organization (sometimes called Certificate of Formation/Organization) with the Secretary of State (or equivalent). Forms vary by state but typically include:
- LLC legal name and principal address
- Registered agent name and street address
- Management type (member-managed or manager-managed)
- Organizer signature; some states request purpose/duration and may request member/manager info
Once filed, the state reviews your submission and will contact the registered agent if anything is missing.
Step 5: Complete Post-Registration Tasks
- Operating Agreement (strongly recommended): governance, capital, voting, distributions, exits.
- EIN (Employer Identification Number) via the IRS (needed for banking/taxes).
- Licenses/permits (local/professional/industry).
- Open a business bank account (keep funds separate).
- Compliance calendar: know annual/biennial reports, any franchise or gross-receipts taxes, and local filings. For Delaware LLCs, the flat $300 tax is due June 1; late = $200 penalty + 1.5%/month interest. For Texas, entities at/under $2.47M revenue still file PIR/OIR even though no tax is due.
Note
Beneficial Ownership Information refresher (2025)
Per FinCEN’s March 26 2025 interim rule, domestic U.S. companies are temporarily exempt from BOI reporting pending new regulations; foreign reporting companies must continue reporting on revised deadlines.
