States with No Annual LLC Fees 2025: Complete Guide
While most states charge annual fees ranging from $13 to $800+, these 9 states require no annual LLC fees, saving business owners hundreds of dollars each year in ongoing compliance costs.
9
States requiring no annual LLC fees
Source: State Government Data 2025
$91
Average across all 50 states
Source: State Filing Fee Analysis 2025
$800
California's mandatory annual tax
Source: CA Franchise Tax Board 2025
$4,000+
vs. highest fee states
Source: Cost Analysis Comparison
9 States with $0 Annual LLC Fees (2025)
Arizona
No annual reports required
per year
Idaho
No ongoing state fees
per year
Minnesota
No annual state fees
per year
Mississippi
No annual reports
per year
Missouri
No ongoing fees
per year
New Mexico
No annual reports
per year
Ohio
No annual reports or fees
per year
South Carolina
No annual fees*
per year
Texas
Under $2.47M revenue
per year
*Some states may have business license fees or franchise taxes depending on business type and revenue
Detailed State Analysis
OH Ohio
One of the most business-friendly states for ongoing LLC costs
Annual Fee
Key Features:
- ✓ No annual reports required
- ✓ No ongoing state fees to Secretary of State
- ✓ Formation fee: $99 (one-time)
- ! Commercial Activity Tax applies if gross receipts >$150,000
Official Source:
Ohio Secretary of State - Filing Forms & Fee Schedule
Ohio does not require LLCs to file annual reports or pay annual fees to maintain good standing.
TX Texas
No franchise tax for most small businesses
For revenue under $2.47M
Key Features:
- ✓ No franchise tax if revenue ≤ $2.47M annually
- ✓ Public Information Report required (no fee)
- ✓ Formation fee: $300 (one-time)
- ! Franchise tax applies if revenue >$2.47M (0.331-0.75%)
Official Source:
Texas Comptroller - Franchise Tax
2025 Update: LLCs with revenue under $2.47M only file Public Information Report (Form 05-102) by May 15.
AZ Arizona
No annual reports for LLCs
Annual Fee
Key Features:
- ✓ No annual reports required for LLCs
- ✓ Formation fee: $50 standard
- ✓ No ongoing compliance fees to Corporation Commission
- ! May require Transaction Privilege Tax license
Official Source:
Arizona Corporation Commission - Fee and Payment Info
Arizona is among the few states that do not require annual reports for LLCs.
Additional Zero Annual Fee States
Idaho
No annual state fees required. Formation fee: $100
Minnesota
No annual state fees. Formation fee: $155
Mississippi
No annual reports required. Formation fee: $50
Missouri
No ongoing state fees. Formation fee: $50
New Mexico
No annual reports to Secretary of State. Formation fee: $50
South Carolina
No annual fees for most LLCs. Formation fee: $110
Annual Fee Comparison by Category
States with $0 Annual Fees
| State | Formation Fee | Annual Fee | Annual Report Required | Notes |
|---|---|---|---|---|
| Arizona | $50 | $0 | No | May need TPT license |
| Idaho | $100 | $0 | No | Clean slate |
| Minnesota | $155 | $0 | No | Clean slate |
| Mississippi | $50 | $0 | No | Clean slate |
| Missouri | $50 | $0 | No | Clean slate |
| New Mexico | $50 | $0 | No | Clean slate |
| Ohio | $99 | $0 | No | CAT if receipts >$150K |
| South Carolina | $110 | $0 | No | Some exceptions apply |
| Texas | $300 | $0 | PIR only | If revenue <$2.47M |
Lowest Annual Fee States (For Comparison)
| State | Annual Fee | 5-Year Cost | vs. Zero-Fee States |
|---|---|---|---|
| Nebraska | $13 | $65 | +$65 |
| Kentucky | $15 | $75 | +$75 |
| Hawaii | $15 | $75 | +$75 |
| Colorado | $25 | $125 | +$125 |
Highest Annual Fee States (For Context)
| State | Annual Fee | 5-Year Cost | vs. Zero-Fee States |
|---|---|---|---|
| California | $800 | $4,000 | +$4,000 |
| Massachusetts | $500 | $2,500 | +$2,500 |
| Nevada | $350 | $1,750 | +$1,750 |
| Delaware | $300 | $1,500 | +$1,500 |
⚠️ Recent Changes (2024-2025)
CA California: First-Year Exemption Expired
Effective January 1, 2024: Assembly Bill 85 (AB 85) exemption expired. New California LLCs must now pay the $800 annual franchise tax from their first year of operation.
Previously, new LLCs were exempt from the $800 fee for their first tax year. This exemption no longer applies to LLCs formed in 2024 and beyond.
TX Texas: Revenue Threshold Updated
2025 Update: The franchise tax "no tax due" threshold remains at $2.47 million in annualized revenue. LLCs below this threshold only file a Public Information Report with no fee.
The "No Tax Due Report" is not available for 2025 reports. Small businesses file only the Public Information Report (Form 05-102) by May 15.
PA Pennsylvania: Upcoming Fee Changes
Scheduled for 2025: Pennsylvania LLC fees are scheduled to increase, though specific amounts are still being determined by the state legislature.
Currently, Pennsylvania operates on a 10-year renewal cycle rather than annual fees, making it one of the most cost-effective states for ongoing compliance.
Important Considerations
💰 Annual Fees vs. Franchise Taxes
Some states may not have "annual fees" but still require ongoing payments through franchise taxes or other mechanisms:
- • Texas: Franchise tax for revenue >$2.47M
- • Ohio: Commercial Activity Tax if gross receipts >$150K
- • South Carolina: License fees may apply to certain business types
📋 Other Ongoing Costs to Consider
Even in zero-fee states, you may have optional ongoing expenses:
- • Registered Agent: $125-200/year if using a service
- • Business Licenses: Varies by industry and location
- • EIN Application: Free directly from IRS
- • Operating Agreement: One-time legal expense
⚠️ Consequences of Non-Compliance
In states that do require annual fees or reports, failing to comply can result in:
- • Administrative dissolution of your LLC
- • Late fees and penalties
- • Loss of good standing status
- • Potential reinstatement fees
Cost Savings Analysis
1-Year Savings
vs. national average
5-Year Savings
vs. national average
vs. California
5-year savings
10-Year Cost Projection Comparison
When to Consider Out-of-State LLC Formation
✅ Good Candidates for Out-of-State Formation:
- ✓ Online/Digital Businesses: No physical location requirements
- ✓ Holding Companies: Primarily for asset protection or investment
- ✓ Multi-State Operations: Already operating in multiple states
- ✓ California Residents: Significant annual fee savings ($800/year)
❌ Should Form In-State:
- × Local Service Businesses: Customers primarily in your home state
- × Licensed Professionals: State licensing requirements
- × Real Estate Holdings: Property located in your home state
- × Retail/Physical Locations: Brick-and-mortar operations
Note: If you form an LLC in a zero-fee state but do business in your home state, you may still need to register as a "foreign LLC" in your home state, which could involve additional fees and requirements.
LLC Formation Details for Zero-Fee States
Compare the formation costs and requirements for each state with no annual fees:
Ohio
LLC Formation Costs & Requirements
Filing Fee
$99
Annual Fee
FREE
Franchise Tax
None
1st Year Total
$99
Processing Time
3-5 business days
5-Year Cost Projection
Total over 5 years
$99
Average per year
$20
Texas
LLC Formation Costs & Requirements
Filing Fee
$300
Annual Fee
FREE
Franchise Tax
None
1st Year Total
$300
Processing Time
5-7 business days
5-Year Cost Projection
Total over 5 years
$300
Average per year
$60
Arizona
LLC Formation Costs & Requirements
Filing Fee
$50
Annual Fee
FREE
Franchise Tax
None
1st Year Total
$50
Processing Time
5-10 business days
5-Year Cost Projection
Total over 5 years
$50
Average per year
$10
Missouri
LLC Formation Costs & Requirements
Filing Fee
$50
Annual Fee
FREE
Franchise Tax
None
1st Year Total
$50
Processing Time
5-7 business days
5-Year Cost Projection
Total over 5 years
$50
Average per year
$10
New Mexico
LLC Formation Costs & Requirements
Filing Fee
$50
Annual Fee
FREE
Franchise Tax
None
1st Year Total
$50
Processing Time
7-10 business days
5-Year Cost Projection
Total over 5 years
$50
Average per year
$10
South Carolina
LLC Formation Costs & Requirements
Filing Fee
$110
Annual Fee
FREE
Franchise Tax
None
1st Year Total
$110
Processing Time
5-10 business days
5-Year Cost Projection
Total over 5 years
$110
Average per year
$22
Ready to Start Your LLC?
Choose from our recommended LLC formation services to get started in any of these zero-fee states.
Compare LLC Formation ServicesOfficial Sources & References
State Government Sources:
Additional Resources:
All fee information verified from official state government websites as of January 2025. Fees and requirements may change; always consult the relevant state agency for the most current information.