Entrepreneurship is exciting—the thrill of developing a winning product or service, bringing that idea to life, and making life better for your clients—it’s fun. But unfortunately, it’s not free. Long story short: starting a business has a price tag. LLCs are no exception.
If you’re hoping to start an LLC in Florida, you’ll quickly learn that you’ll have a pretty long list of fees for forms, licenses, and applications that you’ll need to get started. Some of those are optional fees, and some are unavoidable. In this guide, we’ll walk you through all the costs you can expect when starting a Florida LLC. By the end, you’ll have a clear picture of how your new business will impact your wallet.
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What’s the least amount I have to pay to form an LLC in Florida?
If you’re crunching the numbers before diving right in, good on you! Planning ahead is a surefire way to start your business off on the right foot. But let’s make one thing clear: the phrase “cost to start an LLC” is a bit deceptive. That’s because you don’t want to get stuck focusing on the “day one” expenses of business.
That’s right—when budgeting for start-up costs, you need to account for the costs you’ll pay today and the costs you’ll pay a year or two down the road.
So let’s talk start-up costs and ongoing costs for your Florida LLC. But to keep things simple, here we’ll cover the non-negotiable costs. Later on, we’ll talk about services that are nice to have (but you can live without if you have to).
FL LLC Start-up costs
There are two primary start-up costs in Florida. The most important one is for the Articles of Organization, which has a $125 filing fee. But whether that cost seems totally doable or something you’ll have to pinch pennies for, it’s a cost that you can’t avoid. After all, the Articles of Organization is what officially forms your business in the state. Without it, you’re not a recognized business.
A lot of Florida LLCs will also need to get licenses in order to run a compliant business. The state does not have a general business license that applies to every single entity in the state. Instead, general licenses are administered by your county tax collector. Each county tax collector can charge a different fee for this application, so it’s impossible for us to list the definitive cost here.
There’s also a good chance that you’ll need to obtain industry-specific licenses for your LLC. For example, Florida requires licenses for auctioneers, pawn shops, private investigators in more. Just as we can’t list the application fees for county business licenses, we can’t list all of the different fees here. You’ll have to do your own research to learn what the requirements are. Thankfully, the Department of State’s business licensing resource can help you do just that.
Ongoing costs for an LLC in FL
If your business lasts (and we’re confident it will), then you’ll have several ongoing costs. These include license renewals, annual reports, and taxes. Let’s dig into those prices and fees.
License renewals
You might not have to worry about renewing a general business license, but you do need to renew your county licenses or your professional licenses. Each Florida licensing board and each county tax collector has a different procedure for renewals—including how much you pay to do so and how often you have to do it. When you obtain your licenses, we recommend taking note of the renewal requirements so none of the fees surprise you.
Annual taxes
In Florida, one of the biggest annual costs you’ll have will be taxes. Unlike some states, Florida does not charge an individual income tax—just a corporate one. If your LLC is taxed as a corporation, you’ll pay a flat rate of 5.5%. Businesses involved in the sale of qualifying goods and services will also need to collect and pay the state sales tax. Currently, Florida charges a 6% sales tax. If you have questions about these taxes, check out the Information for Business and Employers resource offered by the Department of Revenue.
Florida also charges a variety of miscellaneous business taxes. Taxes on fuel and child care service businesses are just two of the many tax types Florida has. For more information, check out the Florida Department of Revenue.
Annual report
Most states require LLCs to file some version of an “annual report,” or a document that informs the state about the current standing of your business. This document is usually required in addition to annual tax reports, since it usually includes information about your business address, members, your registered agent, and so on.
In Florida, the annual report process is pretty simple. You file your report online (or by mail by printing off the report, if you’d prefer); all reports are due by May 1st. Provided you file on time, your filing fee is just $138.75. But if you file late, that fee jumps to $400. If you file by mail, a report is still on time if it is postmarked by May 1st.
What are the discretionary costs to form a Florida LLC?
When you’re starting your business, your budget is usually pretty tight. Prioritizing costs can get tricky. The costs we listed above are unavoidable. Well, technically, you can avoid them, but you’ll be heavily penalized if you do. And there’s not much point to spending all that money on starting a business only to knowingly let it be dissolved because you didn’t pay your ongoing costs.
But if you can help it, doing the “bare minimum” is probably not the best way to start your business. There are plenty of discretionary costs you can pay for certain services that make life easier. Here, we’ll dig into those costs—and why you might consider paying them.
1. Name reservation application
Naming things can be a bit tricky; after all, sometimes inspiration is a little lacking! And since Florida doesn’t allow you to use a name that someone else has already claimed, you have to work even harder to pick one that’s unique, memorable, and just right for your business.
It’s a multi-step process, really: you have to brainstorm name ideas, choose just the right words, meet state name requirements, and of course, ensure that the name isn’t already in use (you can check using an Entity Name Search).
If you’re like a lot of people, you probably want to ensure that your hard work doesn’t go to waste once you’ve created the perfect name. So you have to lay claim to your new business name. You can do so either by filing your Articles of Organization, or by writing a letter to the Department of State requesting the name you’ve chosen. Most states give you a form to fill out for this reservation, but Florida leaves it up to you. You should only write a letter requesting a name reservation if you’re not ready to file your Articles. Otherwise, you’d be wasting your hard-earned cash. Florida requires you to send a $25 check (payable to the Department of State) along with your letter. Once complete, this process protects your desired name for 120 days.
2. Obtaining a Fictitious Name
Wait—didn’t we just cover business names? Yes. But there’s a distinction: your business name, which you’ll write in on your Articles of Organization, is the legal name of your business. A fictitious name, sometimes called a DBA, assumed name, or trade name, is like a nickname for your business. For example, your legal name might Joseph Smith, but your friends call you Joe for short. Joe is a perfectly valid name, but you can’t put it on legal paperwork. You’d have to legally change your name to do so.
A Fictitious Name acts kind of like a nickname for your business; some LLCs and corporations also use Fictitious Names to establish new product lines or new “businesses” under the LLC “parent company.” But regardless of why you use a Fictitious Name, if it differs from your legal name, you need to register it before you can use it.
Quick note: Florida does not give exclusive rights to the owners of Fictitious Names. There can be multiple businesses using the same Fictitious Name. That said, Fictitious Names cannot infringe on the legal names of registered businesses like corporations or LLCs. To ensure that you’ve chosen a name that’s both unique and available, we recommend that you run an Entity Name Search and a Fictitious Name Search.
Once you’ve determined that your name is available, you can proceed with registration. You’ll use the Application for Registration of Fictitious Name on SunBiz; it’s an online process. Alternatively, you can file by mail with this form, too. Regardless of how you file, you’ll pay $50 for the application.
And then there’s one last step: declaring your name in a local news publication. Essentially, you’ll file an advertisement stating who you are, the legal name of your business, and the name you’ll be doing business under. The fee for this step in the process varies, since each publication has its own fees for ads.
3. LLC formation services
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Paperwork is a massive hassle. And unless you’re starting an LLC to help other Floridians with their paperwork, odds are you don’t want to deal with much paperwork yourself.
The bad news? Paperwork is an unavoidable part of starting a Florida LLC: The Articles of Organization, county business license applications, professional license applications, annual reports—the list goes on and on. The good news? You can hire an LLC formation service to do the pesky paperwork for you.
Of course, there’s some cost involved. And while there are a lot of great LLC formation services, they aren’t all created equal. And they all have different price points.
Many LLC formation services offer a wide variety of options, with ZenBusiness offering packages starting at $49. You can also take a look at other well known services like LegalZoom, Northwest, and Incfile that have other types of pros.
These services are completely optional; you can DIY your Florida LLC formation. But many entrepreneurs find the time saved is worth the money. If you do opt to hire a service, please make sure you take the time to understand what you’re buying. Some services charge one-time fees, and others tack on “free services” that will cost you next year. If you don’t read the fine print, you can get slapped with unexpected service fees. And surprise bills are never fun.
4. FL Registered agent services
Florida law clearly states that every LLC must designate a registered agent to act as a middleman between your business and the state. Long story short, the registered agent accepts service of process (and any other official communication from the state) on your behalf.
Technically, this is another thing you can DIY; Florida allows you to serve as your own registered agent. However, in our opinion, it’s worth the expense to hire a registered agent.
Why? For starters, a registered agent’s address becomes part of the public record; anyone in the state can find that address. That leads to spam mail (sometimes worse). Plus, a registered agent must be present at the registered address during all standard business hours. If you serve as your own, you’d be tied down to your location constantly. A registered agent service prevents those annoyances. A service will also help you keep track of annual filing requirements, license renewals, and more.
These services typically charge an annual fee. For example, annual fees for our top 4 Florida registered agent services range from $99 to $299 per year depending on the service you choose. That said, some offer the first year free if you use them as an LLC formation service.
Quick Note: If you need to later down the line, you can always change your registered agent.
5. Expedited filing fees
In Florida, even online filings can take up to 10 business days to process. That’s due to the fact that the state processes all documents in the order they were received. Unlike many states, Florida doesn’t offer traditional expedited filing options.
But if you’re in an absolute rush to get your business formed, you can do an in-person filing at the Department of State’s Tallahassee location. Typically, this method has your documents processed in an hour. There’s a $100 surcharge for in-person convenience. That expediting fee isn’t incredibly high (we’ve seen some as high as $1,000), but the Tallahassee location might make it more trouble than it’s worth. You can let your location, budget, and timetable dictate whether you expedite or not.
6. Business attorneys
Starting a business is a complicated process. And it’s a legal one. We do our best to make the process seem less daunting with guides like this one. But at the end of the day, we can’t write a guide that would cover every single question every business will ever face. That’s because your business is unique.
Business attorneys, however, can talk you through all the nuances of forming and running your business. In many cases, the advice of an attorney can save you thousands by helping you avoid expensive legal mistakes.
However, the upfront costs of hiring a business attorney can be pretty pricey. For example, many attorneys charge per hour, with rates ranging between $150-$350. Others offer “LLC formation packages” for flat rates that fall between $500-$2000. And of course, those fees vary based on the attorney’s experience, location, and so on.
If you’d like to hire one, we recommend checking out sites like Avvo.com. Their database is nearly comprehensive, so it’s a great way to search Florida business lawyers. You can also narrow results by location, cost, overall satisfaction rating, and more. It’s the best place to look to find the right legal consultation for your business.
Conclusion
Long story short: starting a Florida LLC can be a pretty pricey endeavor. If you look at each cost separately, it doesn’t seem too bad (even the $125 for the Articles of Organization is relatively manageable). But when you add them all up or tack on some additional services, the total price tag grows pretty quickly.
Thankfully, since you’ve read this guide, you know what you’re up against. And sometimes, knowing is half the battle—and now you’re armed with all the information you need to budget the start-up costs so you can start your Florida LLC off on the right foot. We wish you and your new business the best!