Seventeen states tax your LLC for existing. Most fee tables list none of them

Almost every “LLC fees by state” table on the web is built from two numbers: the formation filing fee and the annual report fee. Both come from the Secretary of State. Both are easy to look up.

The problem is that they are not the only money a state takes from an LLC for existing. Seventeen states also levy a tax on the entity itself — a franchise tax, a privilege tax, a minimum entity tax, a gross receipts tax — and those are administered by the department of revenue, not the Secretary of State. Different agency, different form, different deadline, and so, almost universally, a different table that nobody joins up.

On 27 August 2026 we went through all 51 jurisdictions looking specifically for these. Six states turned out to be materially misrepresented by the fee-only approach:

State	What fee tables show	What it actually costs, minimum
Rhode Island	$50 a year	$450 — plus a $400 minimum tax on Form RI-1065
Vermont	$45 a year	$295 — plus a $250 business entity tax
Tennessee	$300 a year	$400 — plus a $100 minimum franchise tax
Washington DC	$150 a year	$400+ — plus a $250 franchise tax over $12k of receipts
Illinois	$75 a year	$75 + 1.5% of profit — the replacement tax has no threshold
New York	$4.50 a year	$29.50+ — plus the annual IT-204-LL filing fee

None of those six extras is obscure or contested. Each is on the state’s own website. They are missing from fee tables for a structural reason, not a lazy one: a fee table has a column for “annual report fee”, and a minimum tax filed with the Division of Taxation is not an annual report fee, so it has nowhere to go and quietly goes nowhere.

The three that actually change a decision

Rhode Island. The Department of State charges $50 a year for the annual report. The Division of Taxation separately charges a $400 minimum annual tax on Form RI-1065, and it is owed whether the LLC earned anything or not, whether it traded or not. That is a nine-fold difference between the published figure and the real floor, and it moves Rhode Island from the cheap half of the table to near the expensive end.

Tennessee. Sold relentlessly as a no-income-tax state. It is — for individuals. The LLC itself pays a franchise tax with a $100 minimum and a 6.5% excise tax on net earnings. The natural assumption is that a one-person LLC escapes this by being a disregarded entity federally, and that assumption is wrong: under Tenn. Comp. R. & Regs. 1320-06-01-.40 an LLC is disregarded for Tennessee franchise and excise tax only if its single member is itself classified as a corporation. An LLC owned by a person files its own return.

Kentucky. This is the one that started the audit. Kentucky’s $40 formation fee and $15 annual report make it the cheapest state in the country on every list we found. It also charges a Limited Liability Entity Tax with a $175 annual minimum. From tax years beginning 1 January 2026 that is waived below $100,000 of Kentucky gross receipts — which genuinely does make Kentucky the cheapest place in the country for a small freelancer, and mid-table for anyone above the threshold. Not one table we checked mentioned any of it, in either direction. The nuance is the answer, and the nuance is exactly what gets dropped.

Two more that catch people out

Illinois charges a 1.5% Personal Property Replacement Income Tax on the LLC’s own net income. No threshold, no minimum, no exemption — and the members get no credit for it against their personal Illinois income tax, so the same profit is taxed at the entity and again at the owner. On $100,000 of profit that is $1,500 a year that no fee table shows.

New Hampshire has no personal income tax, which is why it is recommended so often. It taxes the business instead: the Business Profits Tax at 7.5% kicks in above $109,000 of gross business income, and the Business Enterprise Tax above $298,000 of gross receipts. For a freelancer clearing six figures, “no income tax” is not what it sounds like.

What is not an entity tax, despite appearances

Half the value of an audit is the negatives, so: several states have a franchise tax that does not reach a default pass-through LLC at all. Georgia’s net worth tax, North Carolina’s franchise tax, New Mexico’s $50, Mississippi’s franchise tax and South Carolina’s licence fee all apply to corporations — including an LLC that has elected corporate treatment, but not to one taxed as a partnership or disregarded. Wisconsin’s economic development surcharge exempts partnerships by statute.

Others are simply gone, and are still being published. Connecticut’s $250 business entity tax was repealed for years beginning 2020. Louisiana’s franchise tax is repealed for periods from 1 January 2026. Pennsylvania’s went in 2016, West Virginia’s in 2015, Oklahoma’s in 2024, Missouri’s in 2016. Kansas phased its out before 2011 — and we still found a 2026-dated page quoting its rate per $1,000 of taxable equity.

Alabama deserves its own line, because we had it wrong ourselves. Our table warned that the business privilege tax “may be higher” than the $50 annual report. It no longer has a minimum at all: under Act 2022-252, for tax years beginning after 31 December 2023, any calculated tax of $100 or less is fully exempt and no return is required. That covers essentially every freelancer LLC. Corrected.

The Delaware problem, which is the older one

Entity-level taxes are the systematic gap. There is also a simpler kind of error, and we found it on the state people look up most.

Delaware’s annual LLC tax is $300. A prominent aggregated table lists it as $400. We checked it against multiple independent sources before publishing, because Delaware is the single most-searched state in this niche and getting it wrong would have discredited everything else.

This is not a criticism of any one site. It is a description of a problem that anyone compiling this data runs into, and a note about what we did instead.

Why these tables drift

Fees change quietly. State legislatures adjust filing fees, franchise taxes and annual report costs on their own schedules, often mid-year. There is no central feed. A table compiled accurately in 2024 is simply wrong in places by 2026.

Everyone copies everyone. Aggregated tables cite other aggregated tables. One error propagates across dozens of sites, and each repetition makes it look better sourced.

The categories are genuinely ambiguous. Is Delaware’s $300 an “annual report fee” or a “franchise tax”? Delaware LLCs file no annual report at all — they pay an annual tax. A table with a column headed “annual report fee” has to decide what to put there, and different compilers decide differently.

The headline number often is not the real cost. New York’s fees look ordinary: $200 to file, $9 every two years. But New York requires publication in two newspapers for six weeks plus a $50 certificate — roughly $230–$1,950 depending on county, with the Manhattan and Brooklyn end of that range dwarfing every listed fee. It is mandatory, and most tables omit it entirely.

What we found across 51 jurisdictions

Beyond Delaware, the figures most likely to be misleading:

• California — $70 to file, which is genuinely among the cheapest in the country. The $800 annual franchise tax is due every year regardless of income, at a loss, or dormant. Over five years that is $4,070 against $99 in Ohio. A table sorted by filing fee puts California near the top of “cheapest”.
• Nevada — $425 to file, $350 annually. Widely marketed as business-friendly on the basis of having no income tax; its fees are among the highest in the country.
• Texas — a franchise tax report is required annually, but most small LLCs owe $0, under a no-tax-due threshold of $2.65M of annualized revenue for 2026 and 2027. Tables that list a franchise tax make Texas look more expensive than it is — though the report itself is still mandatory, and missing it is what actually costs people money.
• Tennessee — the annual report scales with member count, so published figures are minimums, and the franchise and excise tax above sits on top of them.
• Missouri, New Mexico, Ohio, South Carolina, Arizona — no annual report and no annual fee at all, which is worth more over a decade than a low filing fee.

What we did

Cross-checked between sources, and where they disagreed, verified independently before publishing rather than averaging. Averaging contradictory sources produces a table that is wrong in a new and undetectable way.

We also wrote automated checks over our own dataset — not to prove the fees are right, which only a state fee schedule can do, but to catch the errors that creep into a hand- built 51-row table: a missing jurisdiction, a duplicate, a magnitude typo turning $50 into $5,000, a biennial state not annualised for comparison. Delaware’s $300 is pinned as an explicit test so the error cannot reappear.

The entity-tax audit added a rule and then made the rule enforceable. The rule is that our recurring figure means everything owed regardless of income — so an unconditional minimum like Rhode Island’s $400 or Vermont’s $250 belongs inside it, while a threshold tax like Kentucky’s $175 does not, because folding that in would overstate the cost for everyone under the threshold. Each state’s entity tax now carries its own threshold, its rate, and a flag saying whether its minimum is already counted, so nothing double-counts. The checks fail the build if an unconditional tax is left out of the recurring figure, or a conditional one is folded into it.

The data is public

Rather than ask anyone to take our word for it, the whole thing is published at a stable URL with its compiled date, its field definitions and its caveats attached:

All 51 jurisdictions, as a dataset — JSON or CSV.

Each state carries an entityTax object — name, minimum, threshold, rate, and whether that minimum is already inside the recurring fee — plus conditionalEntityMinimum for the amount a threshold tax would add. As far as we can tell it is the only machine-readable LLC fee dataset that carries them at all.

CC BY 4.0. Use it, check it, correct us. If you find an error, the contact address is on the site and corrections are genuinely welcome — that is the fastest way for this to get less wrong, and corrections are logged publicly on the dataset page rather than quietly patched.

The interactive version, including total cost over the years you keep the company, is the LLC cost calculator.

The general lesson

If you are relying on any aggregated fee or rate table for a decision that costs money, check the specific figure against the state’s own schedule. That applies to ours too.

The same problem exists in state income tax data — three sources we consulted disagreed with each other on Georgia, Idaho, Kentucky, Mississippi, North Carolina, Iowa and Utah. We publish that dataset too, naming its single source rather than blending several. Both live in the open data section.