Cheapest state to form an LLC

LLC formation filing fee, lowest first

A fee marked from is a minimum and is ranked by that floor. The state page says what raises it.

Not ranked, the state's own pages disagree on the fee (1): New Jersey.

LLC annual tax and franchise tax by state

An annual, franchise or privilege tax or fee that the state charges an LLC separately from its report fee. Only a flat amount, which every LLC pays, is ranked. A minimum, an amount that only some LLCs pay, and a rule with no single amount are listed with the rule, and not ranked. A statement that one named tax does not apply is listed too: it is not a statement that the state has no LLC tax, and no state is counted here as tax-free.

Flat amount, lowest first (5)

A minimum: at least this amount (1)

• Kentucky: from $175, Limited Liability Entity Tax (LLET). $175 is the minimum, paid when total gross receipts or total gross profits are $3 million or less. Above $6 million the tax is the smaller of 0.095% of Kentucky gross receipts or 0.75% of Kentucky gross profits; between $3 million and $6 million a sliding-scale formula applies. read 2026-09-28

Conditional: only some LLCs pay it (2)

• Oregon: $150 — conditional, Partnership minimum tax. Owed by a partnership that is doing business in Oregon and is required to file a partnership return (Form OR-65); an LLC taxed as a partnership files that return. The Department of Revenue pages read do not state a minimum tax for a single-member LLC treated as a disregarded entity. An LLC that elects corporate taxation falls under the corporation excise tax rules instead. read 2026-09-28
• Vermont: $250 — conditional, Business Entity Income Tax (minimum entity tax). The $250 is a MINIMUM, paid with the Business Income Tax Return (form BI-471 or BI-476). The Department of Taxes says the tax applies to LLCs that elect to be taxed as partnerships or S-corporations; income otherwise passes through to the members. The page does not say how a single-member LLC disregarded for federal tax is treated. read 2026-09-28

Set by a rule, no single amount (7)

• Alabama: Business Privilege Tax. Based on net worth in Alabama: the rate runs from $0.25 to $1.75 per $1,000 of net worth, the rate bracket set by the entity's federal taxable income apportioned to Alabama. The Department of Revenue states a full exemption when the tax due is $100 or less (taxable years beginning after December 31, 2023), and no return is required in that case. read 2026-09-28
• Minnesota: Minimum Fee. Applies to an LLC filing as a partnership with two or more members when its Minnesota property, payroll and sales or receipts reach the threshold. For 2026: less than $1,280,000, $0; then $260, $770, $2,560, $5,140, up to $12,830 at $51,280,000 or more. It does not apply to a single-member LLC reporting only on its member's individual return. Brackets are adjusted annually for inflation. read 2026-09-28
• New Jersey: Partnership Filing Fee. An LLC classified as a partnership that has more than two owners and New Jersey source income or loss pays $150 for each owner, up to a maximum of $250,000, reported on Form NJ-1065, plus one-half of that amount as a prepayment toward the next year's fee. An LLC with one or two owners does not pay it. read 2026-09-28
• New York: Partnership, LLC, and LLP annual filing fee (Form IT-204-LL). Paid to the Department of Taxation and Finance on Form IT-204-LL. $25 for an LLC treated as a disregarded entity that has income, gain, loss or deduction from New York sources. For an LLC treated as a partnership, the fee is set by a table on New York source gross income of the preceding tax year: $25 when that income is not more than $100,000 (or there was none), rising by bracket to a maximum of $4,500. An LLC that has elected to be treated as a corporation does not file this form. read 2026-09-28
• Ohio: Commercial Activity Tax (CAT). A general business tax, not an LLC-specific one: 0.26% of Ohio taxable gross receipts. For tax years 2025 and forward only businesses with more than $6 million a year in Ohio taxable gross receipts need to pay it; below that nothing is due and no registration is required. The annual minimum tax ended in 2024. read 2026-09-28
• Tennessee: Franchise and Excise Tax. Franchise tax: 0.25% of Tennessee net worth, minimum $100, payable whether the company is active or inactive. Excise tax: 6.5% of Tennessee taxable income. Both are paid to the Department of Revenue, separately from the Secretary of State's annual report fee. read 2026-09-28
• Texas: Franchise Tax. A privilege tax on margin. For report years 2026 and 2027 the Comptroller's table gives: No Tax Due Threshold $2,650,000 (annualized total revenue); rate 0.375% for retail or wholesale, 0.75% for others; EZ Computation rate 0.331% for total revenue up to $20 million. An entity at or below the threshold owes no tax but must still file the information report. read 2026-09-28

A named tax that does not apply (7)

• Connecticut: Business Entity Tax (ended) does not apply. The page says: “The Business Entity Tax (BET) no longer exists. Public Act 19-117 has ended the BET for any tax period beginning after 12/31/2018.” source, read 2026-09-28
• Kansas: Franchise Tax (repealed) does not apply. The page says: “There is no Kansas franchise tax for tax year 2011 and after.” source, read 2026-09-28
• Louisiana: Corporation Franchise Tax (repealed) does not apply. The page says: “The franchise tax has been repealed for franchise tax periods beginning on or after January 1, 2026.” source, read 2026-09-28
• North Carolina: Franchise Tax does not apply. The page says: “By default, an LLC is not a corporation under North Carolina franchise tax statutes and is not subject to the franchise tax” source, read 2026-09-28
• Oklahoma: Franchise Tax (eliminated) does not apply. The page says: “Oklahoma's franchise tax has been eliminated as part of a comprehensive tax reform plan.” source, read 2026-09-28
• Pennsylvania: Capital Stock/Foreign Franchise Tax (eliminated) does not apply. The page says: “The Capital Stock/Foreign Franchise tax has been eliminated for tax years beginning January 1, 2016 and after.” source, read 2026-09-28
• South Carolina: Corporate License Fee does not apply. The page says: “not subject to the annual report or the License Fee: A Limited Liability Company (LLC) not taxed as a corporation” source, read 2026-09-28

Annual tax not read (29): Alaska, Arizona, Arkansas, Colorado, District of Columbia, Florida, Georgia, Hawaii, Idaho, Illinois, Indiana, Iowa, Maine, Maryland, Massachusetts, Michigan, Mississippi, Missouri, Montana, Nebraska, New Hampshire, New Mexico, North Dakota, South Dakota, Utah, Washington, West Virginia, Wisconsin and Wyoming.