An LLC (Limited Liability Company) protects your personal assets from business debts and lawsuits while offering flexible tax treatment. It’s the most popular business structure for small businesses, freelancers, and side hustles.
Quick answer: Filing an LLC takes about 30 minutes and costs $35–$500 depending on your state. You’ll need to file Articles of Organization, get an EIN, and create an operating agreement. Most states approve within 1–2 weeks.
How to Start an LLC in 6 Steps
Step
What to Do
Time
Cost
1. Choose your state
File in the state where you do business
5 min
Free
2. Name your LLC
Check availability with your Secretary of State
10 min
Free
3. Choose a registered agent
Person or service to receive legal documents
10 min
$0–$125/year
4. File Articles of Organization
Submit formation document to your state
15 min
$35–$500
5. Get an EIN
Apply for employer identification number from IRS
5 min
Free
6. Create an operating agreement
Document LLC ownership and rules
30 min
Free (DIY)
LLC Formation Costs by State
State
Filing Fee
Annual Fee
Total Year 1
Alabama
$200
$100
$300
Alaska
$250
$100
$350
Arizona
$50
$0
$50
Arkansas
$45
$150
$195
California
$70
$800 (franchise tax)
$870
Colorado
$50
$10
$60
Connecticut
$120
$80
$200
Delaware
$90
$300
$390
Florida
$125
$138.75
$263.75
Georgia
$100
$50
$150
Hawaii
$50
$15
$65
Idaho
$100
$0
$100
Illinois
$150
$75
$225
Indiana
$95
$31
$126
Iowa
$50
$60
$110
Kansas
$160
$55
$215
Kentucky
$40
$15
$55
Louisiana
$100
$35
$135
Maine
$175
$85
$260
Maryland
$100
$300
$400
Massachusetts
$500
$500
$1,000
Michigan
$50
$25
$75
Minnesota
$155
$0
$155
Mississippi
$50
$0
$50
Missouri
$50
$0
$50
Montana
$35
$20
$55
Nebraska
$100
$13
$113
Nevada
$75
$350
$425
New Hampshire
$100
$100
$200
New Jersey
$125
$75
$200
New Mexico
$50
$0
$50
New York
$200
$9
$209
North Carolina
$125
$200
$325
North Dakota
$135
$50
$185
Ohio
$99
$0
$99
Oklahoma
$100
$25
$125
Oregon
$100
$100
$200
Pennsylvania
$125
$70
$195
Rhode Island
$150
$50
$200
South Carolina
$110
$0
$110
South Dakota
$150
$50
$200
Tennessee
$300
$300
$600
Texas
$300
$0
$300
Utah
$54
$18
$72
Vermont
$125
$35
$160
Virginia
$100
$50
$150
Washington
$200
$60
$260
West Virginia
$100
$25
$125
Wisconsin
$130
$25
$155
Wyoming
$100
$60
$160
Cheapest states to form an LLC: Montana ($35), Kentucky ($40), Arkansas ($45), Arizona ($50), Colorado ($50)
Most expensive states: Massachusetts ($500), Tennessee ($300), Texas ($300)
LLC vs Other Business Structures
Feature
Sole Proprietorship
LLC
S-Corp
C-Corp
Personal liability protection
No
Yes
Yes
Yes
Formation paperwork
None
Simple
Moderate
Complex
Formation cost
$0
$35–$500
$35–$500+
$35–$500+
Tax flexibility
No
Yes
Limited
No
Self-employment tax
Yes
Yes
Partial
No
Ongoing compliance
Minimal
Low
Moderate
High
Raising investment
Difficult
Moderate
Moderate
Easy
Best for
Side hustles
Most small businesses
Profitable businesses >$50K
Venture-backed startups
When to Form an LLC
Situation
Do You Need an LLC?
Freelancing/consulting
Yes — protects personal assets
Online business/e-commerce
Yes — liability protection for products/services
Rental property
Yes — shields personal assets from tenant lawsuits
Side hustle under $5K/year
Maybe — sole proprietorship may be fine
Practice profession (doctor, lawyer)
PLLC required in most states
Partnership with others
Yes — essential for multi-member businesses
Uber/Lyft driving
Optional — insurance typically covers liability
Registered Agent Options
Option
Cost
Pros
Cons
Yourself
Free
No cost
Your address becomes public record
Friend or family
Free
No cost
Must be available during business hours
Northwest Registered Agent
$125/year
Privacy, mail forwarding
Annual cost
LegalZoom
$249/year
Brand recognition
Higher price
ZenBusiness
$199/year
Bundled with formation
Annual cost
Incfile
$119/year
Budget option
Basic service
LLC Tax Treatment Options
One of the biggest advantages of an LLC is tax flexibility. You can choose how you want to be taxed:
Can’t open business bank account or hire employees
Filing in Delaware when you operate elsewhere
Still must register in your home state anyway
Bottom Line
Starting an LLC is one of the simplest ways to protect your personal assets and look professional. For most small businesses, it takes under an hour to file and costs $35–$500 depending on your state. Skip the expensive legal services — you can do it yourself through your Secretary of State’s website.