What Is the Cheapest State to Form an LLC in 2026?
Montana is the cheapest state to file an LLC at a $35 filing fee with a $0 annual report through 2027 — but it only makes sense if you live or operate in Montana. Kentucky is next at $40 to file.
For long-term ownership, New Mexico is the cheapest to maintain: a $50 filing fee and $0 annual fees with no annual report ever required.
For non-residents and online sellers, Wyoming is the most recommended overall — $100 to file and $60 per year — thanks to its strong privacy, asset protection, and bank recognition.
Don’t have time to read the full 50-state analysis? Here is the cheat sheet:
Finding the cheapest state to form an LLC is the first strategic move for any entrepreneur launching an Amazon FBA business, a Shopify store, a freelance operation, or a dropshipping brand — especially if you are a non-US resident forming your company remotely. But “cheap” can be dangerously misleading.
Arkansas lures you in with a low $45 filing fee, then hits you with a mandatory $150 franchise tax every single year. California looks manageable until you discover the $800 minimum annual tax regardless of revenue. And the state with the lowest filing fee (Montana, at $35) may cost you more in the long run if you don’t actually live there, because you would have to register a second time in your home state.
To keep you out of these traps, we ranked every state using 2026 Secretary of State data by total long-term cost (filing fee + annual fee) and by who each state is actually best for. If you are forming from outside the US, jump to our non-resident section for the short answer.
🎯 Which State Is Right for Your Situation?
The right state depends on your specific use case. Here is the fastest way to find your answer:
🛒 Non-Resident Amazon/E-Commerce Seller
You live outside the US and sell online. Privacy, bank recognition, and asset protection matter.
→ Recommended: Wyoming💻 Freelancer / Remote Worker
You want the lowest possible long-term cost to legitimize income and open a US bank account.
→ Recommended: New Mexico📦 Small US-Based Business Owner
You operate in a specific state and need to register where you do business.
→ Recommended: Your home state🚀 Startup Seeking VC Funding
You plan to raise venture capital and need an investor-friendly legal structure.
→ Recommended: Delaware💰 Based in Montana (or nearby)
You live or operate in Montana and want the absolute lowest filing fee.
→ Recommended: Montana ($35)🌐 Australia / NZ / Global Seller
You live abroad and sell to US customers via Amazon, Shopify, or Stripe.
→ Recommended: New Mexico or Wyoming🏆 The 2026 Top Picks by Category
New Mexico — Cheapest to Maintain
- Filing Fee: $50
- Annual Fee: $0
- Annual Report: Not required
- Anonymous Ownership: Yes
New Mexico combines a low startup fee with zero annual fees and no reporting. After year one you pay nothing — the cheapest long-term LLC in the USA.
Wyoming — Best for Non-Residents
- Filing Fee: $100
- Annual Fee: $60
- Asset Protection: Strongest in the US
- Privacy: Members not public record
Wyoming has the strongest asset protection in the country, the best bank recognition, and is the industry standard for non-resident Amazon and Shopify sellers.
Read the Wyoming Guide →Montana — Lowest Filing Fee
- Filing Fee: $35 (lowest in USA)
- Annual Fee: $0 through 2027
- Best if: you live/operate in MT
- Runner-up: Kentucky ($40)
Montana has the lowest filing fee in the country. The catch: if you don’t live or do business there, you’ll have to register again in your home state, which usually erases the savings.
🌍 Cheapest State to Form an LLC for Non-Residents
If you are forming a US LLC from outside the country, ignore the “lowest filing fee” states that require local residency. For non-residents running an online business, the decision comes down to two states:
- New Mexico if your only goal is the lowest ongoing cost. At $50 to file and $0 per year, it is the cheapest US LLC to maintain, and it allows anonymous ownership. The trade-off: some US banks are less familiar with New Mexico LLCs, so account opening can take an extra round of questions.
- Wyoming if you want the smoothest path to banking and the strongest legal protection. At $100 to file and $60 per year, it costs slightly more, but Wyoming LLCs are widely recognized by fintech banks like Mercury, Relay, and Wise, and the state’s privacy and charging-order protection are the best in the country. This is why Wyoming is the default recommendation for non-resident Amazon, Shopify, and Stripe sellers.
Whichever you choose, you will need a US Registered Agent, an EIN, and a US business bank account. Our related guides walk through each step: forming a Wyoming LLC remotely, opening a US business bank account as a non-resident, getting a US virtual address for your LLC, and keeping your LLC ownership private.
📊 5-Year Total Cost Comparison (Top States)
The filing fee is only the beginning. Here is what you will actually spend over five years in the most popular low-cost states:
| State | Year 1 Cost | Annual Fee | 5-Year Total | Best For |
|---|---|---|---|---|
| Montana | $35 | $0* | $35* | Residents of Montana only |
| 🏆 New Mexico | $50 | $0 | $50 | Freelancers, non-residents, long-term savings |
| Missouri | $50 | $0 | $50 | Zero annual fees alternative to NM |
| Kentucky | $40 | $15 | $100 | Low upfront cost |
| Wyoming | $100 | $60 | $340 | Privacy, asset protection, non-resident e-commerce |
| Texas | $300 | $0* | $300* | US-based businesses under $1.23M revenue |
| ❌ California | $870 | $800+ | $3,870+ | Avoid unless you operate in California |
| ❌ Massachusetts | $1,000 | $500 | $3,000 | Avoid for remote or non-resident businesses |
*Montana annual report is $0 through 2027 (then subject to change); a Montana LLC is only cost-effective if you live or operate there. Texas franchise tax applies only if annual revenue exceeds $1.23 million.
⚠️ 5 States to Avoid When Forming an LLC
These states appear affordable but carry significant hidden or recurring costs:
- California — $800 minimum annual franchise tax regardless of profit. Avoid unless you physically operate there.
- New York — a mandatory “publication requirement” forces new LLCs to publish notices in two newspapers, costing $500–$1,500+ depending on the county.
- Massachusetts — $500 to file and $500 every year, the most expensive state to maintain an LLC.
- Nevada — marketed as a “tax haven” but charges $425 to file and $350 annually, with fewer real benefits than Wyoming.
- Tennessee — a minimum franchise tax of $100+ applies every year even with zero revenue.
🇺🇸 All 50 States: LLC Cost Ranking (Verified 2026 Data)
This table is sorted by lowest initial filing fee. Pay close attention to the Annual Fee and Notes columns to avoid expensive surprises. Data reflects each state’s Secretary of State fees for 2026.
| # | State | Filing Fee | Annual Fee | Notes & Hidden Costs |
|---|---|---|---|---|
| 1 | Montana | $35 | $0* | Lowest Filing Annual report $0 through 2027. Best only if you live/operate in MT. |
| 2 | Kentucky | $40 | $15 | Low Upfront Simple $15 annual report due June 30. |
| 3 | Arkansas | $45 | $150 | Tax Trap Mandatory franchise tax makes it expensive annually. |
| 4 | New Mexico | $50 | $0 | Best Long-Term No annual report. Anonymous ownership allowed. |
| 5 | Missouri | $50 | $0 | Hidden Gem No annual report. Underrated zero-fee state. |
| 6 | Mississippi | $50 | $0 | Annual report required but fee is $0. |
| 7 | Colorado | $50 | $25 | Very fast online filing system. Periodic report ~$25. |
| 8 | Hawaii | $50 | $15 | Fine for online businesses. Low annual fee. |
| 9 | Michigan | $50 | $25 | Standard annual statement. Straightforward process. |
| 10 | Iowa | $50 | $30 | Biennial report (every 2 years, ~$30–$45). |
| 11 | Arizona | $50 | $0 | Hidden Cost Newspaper publication notice required: ~$150+. |
| 12 | Utah | $59 | $18 | Small annual renewal fee. Straightforward filing. |
| 13 | California | $70 | $800+ | Avoid $800 minimum annual franchise tax regardless of revenue. |
| 14 | Delaware | $110 | $300 | Best for VC-backed startups. Expensive for small businesses. |
| 15 | Indiana | $95 | $31 | Biennial report (~$31 every 2 years, online). |
| 16 | Ohio | $99 | $0 | No annual report or annual fee required. |
| 17 | Wyoming | $100 | $60 | Best for Non-Residents Strongest asset protection. Great bank recognition. |
| 18 | Georgia | $100 | $50 | Simple annual registration. Good banking infrastructure. |
| 19 | Idaho | $100 | $0 | Annual report required but filing fee is $0. |
| 20 | Oregon | $100 | $100 | Flat fees across the board. Predictable costs. |
| 21 | Virginia | $100 | $50 | Annual registration fee. Strong business ecosystem. |
| 22 | Louisiana | $100 | $35 | Low annual fee. Online filing available. |
| 23 | Maryland | $100 | $300 | Personal Property Return required annually. Expensive to maintain. |
| 24 | Oklahoma | $100 | $25 | Annual certificate fee. Straightforward process. |
| 25 | W. Virginia | $100 | $25 | Annual report due July 1. |
| 26 | Nebraska | $105 | $10 | Publication Newspaper notice required (~$100–$200 extra). |
| 27 | South Carolina | $110 | $0 | No annual report required unless taxed as S-Corp. |
| 28 | Connecticut | $120 | $80 | Annual report due March 31. |
| 29 | Florida | $125 | $138 | Strict Penalties $400 late fee if annual report missed. |
| 30 | N. Carolina | $125 | $200 | Annual report fee is high. Less competitive than neighbors. |
| 31 | Pennsylvania | $125 | $7 | Annual report now required ($7). Formerly decennial. |
| 32 | New Jersey | $125 | $75 | Annual report fee. Straightforward process. |
| 33 | Vermont | $125 | $35 | Annual report fee. Smaller business community. |
| 34 | North Dakota | $135 | $50 | Annual report due November 15. |
| 35 | Wisconsin | $130 | $25 | Annual report fee. Reasonable maintenance cost. |
| 36 | Rhode Island | $150 | $50 | Annual report fee. |
| 37 | Illinois | $150 | $75 | Annual report fee. |
| 38 | South Dakota | $150 | $50 | No state income tax. Decent privacy laws. |
| 39 | Kansas | $160 | $50 | Annual report fee. |
| 40 | Maine | $175 | $85 | Annual report fee. Expensive for a small state. |
| 41 | New Hampshire | $100 | $100 | Annual report fee matches filing fee. |
| 42 | Washington | $200 | $70 | B&O tax may apply. Annual report ~$70. |
| 43 | Alabama | $200 | $100+ | Privilege tax minimum of $100 annually. |
| 44 | New York | $200 | $9 | Avoid Mandatory publication in two newspapers: $500–$1,500+ cost. |
| 45 | Alaska | $250 | $100 | Biennial report ($100 every 2 years). |
| 46 | Texas | $300 | $0* | Franchise tax only if revenue exceeds $1.23M/year. |
| 47 | Tennessee | $300 | $300 | Minimum franchise tax applies annually. |
| 48 | Nevada | $425 | $350 | Avoid Oversold as a tax haven. Far pricier than Wyoming. |
| 49 | Massachusetts | $500 | $500 | Avoid Most expensive state to maintain an LLC long-term. |
| 50 | D.C. | $99 | $300 | Biennial report ($300). High ongoing cost. |
📌 State filing and annual fees change periodically. These figures reflect 2026 Secretary of State schedules and are provided for general comparison, not legal or tax advice. Always confirm the current fee on your state’s official Secretary of State website before filing, and consult a qualified professional for your specific situation.
Frequently Asked Questions
What is the cheapest state to form an LLC in the USA in 2026?
Montana is the cheapest state to file an LLC in 2026 at a $35 filing fee with $0 annual report through 2027, followed by Kentucky at $40. However, Montana only makes sense if you live or operate there, since otherwise you must also register as a foreign LLC in your home state. For long-term ownership, New Mexico is the best value at $50 to file and $0 in annual fees with no annual report.
What is the cheapest state to form an LLC for a non-US resident or foreigner?
New Mexico and Wyoming are the two best states for non-US residents. New Mexico is cheapest to maintain at $50 to file and $0 in annual fees, and allows anonymous ownership. Wyoming costs $100 to file and $60 per year but offers stronger asset protection, better US bank recognition, and privacy, making it the preferred choice for non-residents running Amazon FBA, Shopify, or Stripe businesses. Both can be formed entirely online without visiting the US.
Which states have $0 annual LLC fees?
Several states have $0 annual report fees for LLCs, including New Mexico, Missouri, Ohio, Mississippi, Idaho, South Carolina, and Montana (through 2027). Among these, New Mexico and Missouri are the safest choices because they have no hidden publication costs. Arizona also has no annual fee but requires a newspaper publication notice that can add $150 or more.
Do I need to visit the United States to open an LLC?
No. You do not need to visit the United States to form an LLC. The entire process is online: (1) hire a Registered Agent in the state of formation, (2) file your Articles of Organization through the state portal, (3) obtain an EIN from the IRS using Form SS-4, and (4) open a US business bank account through a fintech provider such as Mercury, Relay, or Wise. See our non-resident banking guide.
Why is Wyoming recommended for non-residents over New Mexico?
Wyoming is preferred for non-residents who run active businesses because it has the strongest LLC asset protection in the US, keeps members off public records, and is widely recognized by US fintech banks, which makes account opening far smoother. New Mexico is cheaper overall, but for most e-commerce sellers the extra ~$110/year for Wyoming’s protection and banking access is worth it.
Why is Delaware popular for LLCs if it is expensive?
Delaware is popular specifically for startups seeking Venture Capital funding, not for small businesses or solo operators. Its Court of Chancery and investor-friendly law are why most VCs require a Delaware entity. For a regular small business, freelancer, or remote seller, the $90 filing fee and $300 annual franchise tax are unnecessary costs with no practical benefit.
Is Texas a good state to form an LLC?
Texas is a good option if your business is based in or operates in Texas. The $300 filing fee is high, but there is no annual report fee, and franchise tax only applies when revenue exceeds roughly $1.23 million. For non-residents or online businesses without Texas ties, New Mexico or Wyoming are more cost-effective. See our Texas LLC Formation Guide.
What is the difference between a filing fee and an annual report fee?
A filing fee is the one-time cost to register your LLC with the state. An annual report fee (sometimes called an annual renewal fee or franchise tax) is a recurring yearly charge to keep your LLC in good standing. Always compare both: a state with a $50 filing fee but a $200 annual fee is far more expensive over time than one with a $100 filing fee and $0 annual fee.
🚀 Ready to Form Your LLC? Start Here
Now that you have compared all 50 states, use our step-by-step guides to finish the job:
8 Comments
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Great breakdown! I was just about to file in Arkansas because of that $45 fee. You saved me from a $150/year nightmare. Looks like New Mexico is the real winner here. Is the process for setting up an NM LLC as a non-resident really that straightforward?
Great question! We’re glad the article could help you avoid that trap—the Arkansas “tax trap” is exactly why we created this ranking. And yes, for non-residents, New Mexico is incredibly straightforward.
This is a huge help for someone outside the US like me. I’ve been told Delaware is the only way to go, but that $300 annual franchise tax is steep. The table shows Wyoming at $100 filing / $60 annual. For an Amazon FBA seller based in Europe, which is the smarter pick for long-term savings?
Wyoming beats Delaware for most international Amazon sellers.
Lower cost ($60/yr vs $300/yr), stronger asset protection, better privacy with anonymous ownership, and no complexity. Delaware’s Court of Chancery only matters if you’re raising venture capital — irrelevant for e-commerce.
Excellent post. I’m a freelance consultant and value my privacy. The article mentions Wyoming is best for privacy, but I see New Mexico also offers anonymity. Which one is actually better for keeping my name off the public record?
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