How Much Does a Business License Cost?
Business license and registration fees vary wildly by state and entity type. An LLC in Kentucky costs just $40 to file while Massachusetts charges $500. Annual report fees range from $0 in Ohio and Texas to $800 in California. This calculator estimates your total first-year costs including state filing fee, annual report or renewal fee, and general business license fee based on your state, entity type, and estimated revenue.
LLC vs Corporation Filing Fees by State
LLCs are the most popular business structure for small businesses due to simpler compliance and pass-through taxation. LLC filing fees range from $40 to $500, with most states charging $50-$200. Corporation filing fees are often similar but corporations face more complex annual reporting requirements. Delaware is popular for incorporation due to its business-friendly courts despite higher annual fees ($300 LLC, $225 corp). Wyoming offers low fees ($100 filing, $60 annual) with strong privacy protections.
Hidden Costs Beyond the Filing Fee
State filing fees are just the beginning. Most businesses also need a city or county business license ($50-$500 depending on location and revenue), a DBA filing if operating under a trade name ($10-$100), an EIN from the IRS (free), and potentially industry-specific permits. Budget 10-20% above the state-level estimates from this calculator to cover local requirements. Some states like California add an $800 annual franchise tax regardless of revenue.
Business License Fee Calculator
LLC Filing Fees by State
Initial formation fee and annual report cost
| State | LLC Filing Fee | Annual Report | Corp Filing Fee | Corp Annual Report |
|---|---|---|---|---|
| California | $70 | $800 | $100 | $25 |
| Texas | $300 | $0 | $300 | $0 |
| New York | $200 | $9 | $125 | $9 |
| Florida | $125 | $139 | $70 | $150 |
| Illinois | $150 | $75 | $150 | $75 |
| Delaware | $90 | $300 | $89 | $225 |
| Nevada | $75 | $350 | $75 | $350 |
| Ohio | $99 | $0 | $99 | $0 |
| Georgia | $100 | $50 | $100 | $50 |
| Wyoming | $100 | $60 | $100 | $50 |
How to Use This Calculator
- Enter Your State: Type or select your state in the field provided. Use the most accurate value available for best results.
- Enter Your Business Entity Type: Type or select your business entity type in the field provided. Use the most accurate value available for best results.
- Enter Your Estimated Annual Revenue ($): Type or select your estimated annual revenue in the field provided. Use the most accurate value available for best results.
- Click Calculate: Hit the Calculate button to run the numbers. Results appear instantly below.
- Review Your Results: Check your state filing fee, annual report/renewal, business license fee. Use these figures to inform your next decision or compare against alternative scenarios.
How It Works
Starting a business requires various licenses and permits, each with its own fee structure that varies by state and entity type.
The basic rule:
- State filing fee: one-time cost to register your business entity with the state (typically $50–$500)
- Annual report: most states require yearly filings with fees ranging from $0 to $800
- Business license: general license required by most cities/counties, often based on revenue
- Entity type matters: LLCs and corporations cost more to form than sole proprietorships
- Additional permits (health, zoning, professional) may be required depending on your industry
These are state-level estimates. Most businesses also need city or county licenses. Budget 10-20% above these estimates for additional permits and professional filing assistance.
Tips & Considerations
- Double-check your state before calculating — even small input errors can significantly change your results.
- Run the calculator with different values to compare scenarios and find the optimal approach for your situation.
- Pay attention to both state filing fee and annual report/renewal — they work together to give you the full picture.
- Bookmark this page for quick access next time you need to understand your legal situation.
- If you're unsure about your estimated annual revenue, start with a conservative estimate and adjust from there.
Frequently Asked Questions
How much does it cost to start an LLC?
LLC formation fees range from $40 (Kentucky) to $500 (Massachusetts). Most states charge between $50 and $200. Add annual report fees of $0-$300 per year depending on the state. Total first-year costs are typically $100-$800 for state fees alone.
Do sole proprietorships need a business license?
Sole proprietorships generally don't need state-level formation filings, but most cities and counties require a general business license. If you use a name other than your own, you'll also need a DBA (Doing Business As) filing, typically $10-$100.
What is an annual report fee?
Most states require businesses to file an annual or biennial report to keep their registration current. Fees range from $0 (some states for certain entities) to $800+. Failing to file can result in administrative dissolution of your business.
Are business license fees tax deductible?
Yes. Business license fees, filing fees, and annual report fees are generally deductible as ordinary business expenses on your tax return. Keep receipts for all government fees paid.
Do I need a federal business license?
There is no general federal business license. However, certain industries require federal permits — alcohol, tobacco, firearms, aviation, mining, and broadcasting, among others. Most small businesses only need state and local licenses.
How often do business licenses need to be renewed?
Most business licenses require annual renewal. Some states and cities offer multi-year options. Annual report deadlines vary by state — some are on a fixed date, others are based on your formation anniversary.
What is the cheapest state to start an LLC?
Kentucky has the lowest LLC filing fee at $40. Other affordable states include Colorado ($50), Mississippi ($50), and Iowa ($50). However, if you do business in a different state than where you form your LLC, you will need to register as a foreign LLC in that state too, adding another filing fee.
Do I need a business license to sell online?
In most cases, yes. Even online-only businesses typically need a general business license from their city or county, a sales tax permit if selling taxable goods, and state registration for their business entity. Requirements vary by location — check your city and state business portal for specific requirements.