Essaminc — What an incorporated company is and how one | essaminc.com
The first year costs roughly USD 50-500 depending on the state and on who files; the years after cost USD 0-500.
The first layer is the state filing fee. Several states charge a flat USD 50-125 for the articles; California charges roughly USD 70; Delaware charges USD 90. This is the number most advertisements quote, and it is the smallest number in the stack.
The second layer is the annual state tax behind the fee. California adds a business entity tax of USD 85-800 a year; Delaware takes a minimum franchise tax of USD 300 a year on a corporation with up to 10,000 shares. The same company can therefore differ by USD 200 or more a year on paperwork alone.
The federal layer costs nothing if done directly: an EIN from the IRS is free and takes about 15 minutes online, while third-party 'EIN applications' charge USD 50-200 for the same number. An EIN is only required if the LLC has more than one member, the business is a corporation, or certain tax returns must be filed.
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The address layer is the registered agent at USD 50-300 a year with a formation service. Serving as your own agent costs nothing but puts a home address on the public record, where it can be harvested for scams.
Worked totals: a do-it-yourself filing in a flat-fee state costs USD 50-125 in the first year and close to USD 0-50 a year after. A formation service route costs USD 100-500 in the first year, then USD 25-300 a year in renewals plus the annual report.
As three yearly budgets: about USD 0 for a self-served company in a free-report state; about USD 100 for a low-end renewal service plus a small report fee; about USD 500 for a Delaware corporation once the USD 300 franchise tax, a USD 50-300 agent renewal and a report fee are added. The entity behind these budgets is compared at /inc-vs-llc-vs-ltd.
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