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Questions we hear most about LLCs
Short answers to the questions that come up before, during and after filing.
How much does it cost to form an LLC?
The state filing fee is the only required cost, and it ranges from about $35 to $500 depending on the state. On top of that, budget for:
- A registered agent service, if you use one: about $50 to $300 per year
- Your state's annual or biennial report fee
- Local business licenses
- Newspaper publication, in New York or Nebraska
Getting an EIN from the IRS is free.
How long does it take?
Online filings are often approved in one to five business days; some states approve them the same day. Mailed filings can take several weeks. Most states offer expedited processing for an extra fee.
Do I really need a registered agent?
Every LLC must have one; it's a legal requirement in every state. What you don't need is to pay for one. You can be your own agent if you have a physical street address in the state and are there during business hours. Many owners pay for a service to keep their home address off the public record, avoid being served in front of customers, and get reliable compliance reminders.
What happens if I don't have a registered agent, or mine quits?
If your LLC has no valid agent, you can miss a lawsuit and have a default judgment entered against your company without knowing it, and the state can revoke your LLC's good standing or dissolve it. If your agent resigns, file a change of registered agent with your Secretary of State promptly.
Can I change my registered agent later?
Yes. File a statement of change with your state, usually online and for a small fee. Many commercial agents will handle the filing for you when you switch to them.
Should I form my LLC in Delaware or Wyoming?
Usually not, if you live and work in another state. You'll likely have to register as a foreign LLC in your home state anyway, which means paying fees and keeping a registered agent in both states. Forming at home is simpler and cheaper for most small businesses. More on choosing a state.
How is a single-member LLC taxed?
By default, the IRS treats it as a "disregarded entity." You report business income and expenses on Schedule C with your personal Form 1040 and pay self-employment tax on net profit, just like a sole proprietor. You can elect to be taxed as an S corporation or C corporation instead. More on LLC taxes.
Do I need an EIN for a single-member LLC with no employees?
The IRS doesn't always require one, but you'll want one anyway: banks almost always ask for an EIN to open a business account, and it lets you give clients a tax ID on Form W-9 instead of your Social Security number. It's free and instant at IRS.gov. See our step-by-step EIN guide.
Do I need to file a BOI report with FinCEN?
Not for an LLC formed in the United States. FinCEN exempted US-formed companies from beneficial ownership reporting in 2025 and made that exemption final in 2026. Foreign companies registered to do business in the US are still subject to reporting.
Can I convert my sole proprietorship to an LLC?
Yes. You form a new LLC the same way anyone else does, then move the business into it: open a new bank account, update contracts and invoices to the LLC's name, and transfer equipment or other assets. You'll generally need a new EIN for the LLC.
What do I need to do every year?
- File your state's annual or biennial report and pay any franchise tax
- Keep your registered agent current
- File federal and state tax returns, and pay estimated taxes quarterly
- Renew local licenses and permits