There are many ways to form an entity like an LLC. One way is to file Articles of Organization with the Secretary of State. This article explains what it costs to do so.
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How Much Does a Tennessee LLC Cost?
An LLC filing costs $300+, depending on your state. For example, an LLC filing in California costs $200, while it costs $500 in New York. There are many states where forming an LLC does not cost anything. However, some states require a certain amount of capitalization to start an LLC. Tennessee requires a minimum of $100.
Tennessee Annual Report Fee: $300+
The Tennessee Secretary of State’s Office announced it will begin charging a $300 annual filing fee starting January 1st. In addition to the $300 filing fee, there are additional fees based on how many entities you file. For example, if you file one entity, there is no filing fee. If you file 10, there is a $10 per entity filing fee. If you filed 20, there is a $20 per entity filing fee.
There is a $25 late penalty if you miss our deadline. You must submit your filing within 30 days of the due date. Your report must be submitted electronically via eFileTN.com. We do not accept paper filings.
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Registered Agent Fee
Registering your agent will help keep costs down. If you’re self-representing, you’ll only be charged $25 per year to maintain your registration. However, you’ll be charged $100 annually if you decide to use another agency.
You can register as a “registered agent” if you choose the Northwest Regional Agency option. This way, you won’t be paying any additional fees.
Tennessee Franchise Tax: Varies
The franchise tax is based on net income. Net income includes gross receipts minus expenses. Gross receipts are defined as total income received less allowable deductions. Allowable deductions include depreciation, interest expense, taxes, and other items.
Net income is determined by dividing the corporation’s taxable income by one hundred. This number is multiplied by.0125 to arrive at the franchise tax owed.
The franchise tax is paid quarterly, beginning April 15th. A late filing fee applies to delinquent payments.
How Much Does it Cost to Form a Foreign LLC in Tennessee?
A foreign LLC is required if a corporation wants to do business in Tennessee. If you are incorporated outside of Tennessee, there is no requirement to form a foreign LLC. However, it could make sense to form one because it offers additional benefits, including limited liability protection and the ability to conduct business without paying franchise taxes.
Each person associated with the LLC has a $50 registration fee. This includes the initial filing fee, annual renewal fees, and any amendments to the articles of organization. The filing fee is due within 30 days of the LLC’s formation date.
Business Permits and Licenses
Licensing requirements vary widely across the United States. In some states, such as California, businesses must obtain a license. Other states, like Florida, don’t require licensing for most types of businesses. Some states, like New York, are divided into several regions. Each region requires different licenses and permits based on what kind of business you’re operating.
For example, if you plan to open a restaurant, you’ll need to obtain a food handler’s license from the local health department. If you plan to sell alcohol, you’ll need to apply for a liquor license from the Alcoholic Beverage Control Board. And if you want to run a barbershop, you’ll need to acquire a barbering license from the Barber Board.
Other LLC Filing Costs
There are several additional costs associated with forming an LLC. Obtaining a DBA or Business Entity Name will cost you money. You’ll also need to obtain a Certified Copy of your Articles of Organization, Operating Agreement, and Bylaws. A filing fee is required to file these documents with the Secretary of State. If you’re interested in incorporating an LLC, contact us today. We offer free consultations, and we’ll help you determine whether it makes sense for your business.
Frequently Asked Questions
What is the cheapest way to get an LLC?
If you want to start a small business without having to spend thousands of dollars, there are several ways to do it. One of those options is forming an LLC. But what does that mean exactly? What are some things you might consider doing yourself? And how much could you potentially save? Let’s take a look at each option and see what makes sense for you.
The most common method of forming an LLC is self-formation. This allows you to form your own LLC online with very little cost. The biggest advantage of self-formation is that it gives you complete control over the structure of your entity. If you don’t like the name you choose, you can change it later. You can decide whether you want to operate under one member or multiple members. There are no fees involved either. All you need to pay is the state filing fee.
#2: Legal Services
Another popular option is to use legal services. A lawyer can help you prepare documents, file paperwork, and even draft an operating agreement. Depending on where you live, you may be able to find a local attorney who specializes in helping people set up businesses. In addition to saving money, hiring a lawyer can give you access to expertise that isn’t readily available online.
#3: DIY Operating Agreement
You can also make your own operating agreement. An operating agreement is similar to a contract. It outlines the rules and regulations for running your LLC. You can hire someone to write one for you, or you can draft one yourself. Either way, you’ll need to make sure you include everything you need in order to run the business properly. For example, you’ll probably want to include information about ownership, membership, management, and liability.
Can I pay myself a salary from my LLC?
To make money from your LLC, you must treat it like a regular corporation and pay taxes on its earnings. However, the Internal Revenue Service (IRS) has some differences in how corporations and LLCs are treated. If you use an LLC to pay yourself a salary, the IRS treats it differently than it does a traditional corporation. This article explains what happens when you pay yourself a salary from an LLC.
Is an S corp better than an LLC?
An S corporation is not a type of business structure. Instead, it’s a tax classification for small businesses. If you want to start a business, there are three main types of entities to choose from: sole proprietorship, partnership, and limited liability companies (LLCs). Each one has pros and cons, but most people use LLCs for their simplicity. However, if you’re looking for a simpler form of taxation, an S Corp might be a good choice.
Is the Tennessee Annual Report the same as the Tennessee Franchise Tax or Excise Tax?
The annual report is filed with the Tennessee Secretary of State and is required to be submitted within 30 days of the end of each calendar year. The annual report includes information about the corporation’s financial statements, including balance sheets, income statement, statement of changes in stockholders’ equity, cash flow statement, and notes to the financial statements.
Tennessee requires corporations to pay both franchise and excise taxes based on the amount of net taxable “business receipts.” This amount is determined by subtracting certain deductions from gross sales revenue. Gross sales revenue is defined as the total amount of money received from customers minus returns and allowances. Returns and allowances include items such as shipping charges, discounts, rebates, and refunds.
Franchise tax is paid on the portion of gross sales revenue that exceeds $25 million. Excise tax is paid on the remainder of gross sales revenue.
Excise tax rates vary depending on the type of goods sold. For example, cigarettes are taxed at 3%, liquor and beer are taxed at 2.5% and gasoline is taxed at 4%.
James Rourke is a business and legal writer. He has written extensively on subjects such as contract law, company law, and intellectual property. His work has been featured in publications such as The Times, The Guardian, and Forbes. When he’s not writing, James enjoys spending time with his family and playing golf.