You can start an LLC with no money in the sense that every optional cost is avoidable, but one cost is not: the state filing fee for your Articles of Organization, which runs roughly $35 to $500 depending on where you form. Skip the attorney, skip the online formation service, skip the paid registered agent, and apply for your federal tax ID directly with the IRS for free. What’s left is the state’s fee and your own time.
The One Fee You Cannot Avoid
Every state charges a one-time fee to process your Articles of Organization and record the LLC. Rates vary widely. Some states charge as little as $35 to $50. A handful charge $300 to $500. The national average sits around $130. No state waives this fee based on how little capital you have, so it is the true floor on forming an LLC.
You pay it directly to the Secretary of State (or the equivalent agency) when you submit your formation documents. Online portals take credit cards or electronic checks. Mail filings take a check or money order for the exact amount. Get the payment right the first time — a rejection can push your formation back by weeks.
Prepare and File the Articles of Organization Yourself
The Articles of Organization is the document that legally creates your LLC, and it becomes part of the public record once the state accepts it.1Legal Information Institute. Articles of Organization Doing this yourself is where most of the savings live. Attorneys and formation services typically charge $100 to $300 or more for the same work, and the official form is a free download from your Secretary of State’s website.
Check Name Availability First
Before you fill in anything, search your state’s business name database to confirm your chosen name is not already taken. The name must include a designator — usually “LLC,” “L.L.C.,” or “Limited Liability Company” — so the public can see it is a limited liability entity. If your first choice is unavailable, pick a different one before you go further.
What the Form Asks For
Most states ask for the same core details:1Legal Information Institute. Articles of Organization
- The LLC name, including the designator.
- The principal office address where the business operates.
- A registered agent to receive legal documents on the LLC’s behalf.
- Management structure: member-managed (owners run it) or manager-managed (a designated manager runs it).
- Duration, which in most states defaults to perpetual.
- Organizer or founding-member names, in states that require them.
Be Your Own Registered Agent
A registered agent receives lawsuits, government notices, and official correspondence for the LLC. Paid registered-agent services run $50 to $300 a year. You can serve as your own agent for free if you have a physical street address (not a P.O. box) in the state of formation and are available during normal business hours to accept documents.2Internal Revenue Service. Limited Liability Company (LLC) The tradeoff: your address goes on the public record, and someone needs to be reachable at it during business hours.
Check every field before submitting. Errors cause rejections, and some states charge a new fee to refile.
Write Your Own Operating Agreement
An operating agreement is an internal document covering who owns what, how profits and losses are split, what happens if a member leaves, and how decisions get made. In most states it is not filed with the state, and a handful of states legally require one. Writing it yourself costs nothing, and free templates are widely available.
Skip it, and your LLC runs on whatever default rules your state’s LLC statute supplies, which may not match what you and any co-owners actually agreed to. There’s also a liability angle: courts sometimes treat the absence of an operating agreement as evidence that the LLC was never operated as a genuine separate entity, which can weaken your personal liability protection. A written agreement is a cheap, strong signal that the LLC is a real, independently operated business.
Submit the Paperwork
Most states have an online filing portal. You create an account, enter your business information or upload a completed PDF, and pay the fee electronically. The portals usually flag missing fields before the payment screen, which cuts down on rejections.
Standard processing runs from a few minutes to a few weeks depending on the state and whether you file online or by mail. Online is generally faster. Many states offer expedited processing for an extra $25 to $100, bringing the wait down to one to three business days or same-day. If you are keeping costs down, standard processing is fine for most situations.
Where paper filing is still accepted or required, print the completed Articles and mail them certified for proof of delivery, with a check or money order for the exact fee. Once the state processes the filing, you get back a stamped copy of the Articles or a formal Certificate of Organization — your official proof the LLC exists.3Legal Information Institute. Certificate of Organization
Free Steps After Formation
Get an EIN Directly From the IRS
After the state approves the LLC, apply for an Employer Identification Number from the IRS. The EIN is a free nine-digit number that works like a Social Security number for your business. You need it to file taxes, open a bank account, and hire employees. Apply online at irs.gov and the EIN is issued immediately. Fax (Form SS-4) and mail applications are also accepted, but take longer.4Internal Revenue Service. Employer Identification Number
Ignore third-party sites that charge for EIN registration. The IRS does it for free; the paid sites are just middlemen.
Open a Business Bank Account
A separate business account is essential to preserving liability protection. Mixing personal and business funds gives a court reason to decide the LLC is not truly separate from you, which puts your personal assets at risk for business debts. Shop for a no-fee or low-fee business checking account with no minimum balance. Banks typically ask for the stamped Articles and the EIN confirmation letter to open the account.
Local Licenses and Permits
Depending on your industry and location, your city or county may require a general business license, a health permit, zoning clearance, or other registrations before you can operate. Requirements vary by locality. Some permits are free, others carry fees based on business type. Check with your local government offices before you start work.
The Hidden Cost in a Few States: Publication
A small number of states require you to publish notice of your LLC’s formation in local newspapers. Arizona and Nebraska require publication for three consecutive weeks. New York requires six consecutive weeks in two newspapers designated by the county clerk. After publication, you file proof with the state.
Costs vary dramatically. Arizona and Nebraska publication is often modest. New York’s rates depend on the county. Upstate counties may total a few hundred dollars. New York City counties, especially Manhattan and Brooklyn, can run $800 to over $1,500 for the ads alone, plus a $50 state fee for the Certificate of Publication. If you’re forming an LLC on no money in New York, this is a real cost you have to plan for, not an optional add-on.
Recurring Costs You Need to Budget For
“No money to start” does not mean no money ever. The LLC has ongoing obligations that cost money to keep current, and letting them lapse is more expensive than paying them on time.
Annual or Biennial Reports
Most states require LLCs to file a periodic report, annually or every two years, confirming the registered agent, business address, and member or manager information. Fees range from nothing in a few states to $300 or more, with most falling between $25 and $150. Missing this filing is one of the most common ways LLCs lose good standing.
Franchise and Minimum Taxes
Some states charge a franchise tax or minimum annual tax on LLCs just for the privilege of doing business there. It applies whether or not you turn a profit. Some states use a flat fee; others calculate it from revenue or member count. Look up your state’s specifics so this does not surprise you in year two.
What Happens if You Miss a Deadline
Miss a required report or franchise-tax payment and the state can impose late fees, revoke the LLC’s good standing, and eventually administratively dissolve the entity. Dissolution kills the liability shield. Reinstatement is usually available, but it means paying all overdue fees, any penalties, and filing the missed reports. Staying current is cheaper.
How a No-Cost LLC Gets Taxed by Default
The IRS does not treat an LLC as its own tax category. It assigns a default based on how many members you have. A single-member LLC is a “disregarded entity”: business income and expenses go on your personal return via Schedule C. A multi-member LLC is treated as a partnership, with each member getting a Schedule K-1 for their share of income and deductions.2Internal Revenue Service. Limited Liability Company (LLC) Neither requires a separate federal election; they apply automatically unless you choose otherwise.
Under those defaults, members owe self-employment tax on their share of profits. The rate is 15.3 percent: 12.4 percent for Social Security and 2.9 percent for Medicare.5Internal Revenue Service. Self-Employment Tax (Social Security and Medicare Taxes) Self-employment tax kicks in once your net self-employment earnings reach $400 for the year.6Internal Revenue Service. Topic No. 554, Self-Employment Tax It stacks on top of regular income tax, which catches new owners off guard. You can deduct the employer-equivalent portion (half the self-employment tax) when figuring adjusted gross income, but the total is still meaningful on a profitable business.
Keep the Liability Shield You Just Paid For
The point of forming an LLC is separating personal assets from business obligations. Filing the Articles does not make that protection automatic — ongoing practices do. Mixing personal and business money, ignoring state filings, or operating without an operating agreement each give a court a reason to disregard the LLC’s separate status and hold you personally liable.
The minimum maintenance is a dedicated business bank account, every required state report filed on time, and a written operating agreement that reflects how the LLC actually operates. Beyond that, consider general liability insurance when you can afford it. The LLC shields personal assets from business debts, but that protection has limits, and insurance covers gaps the structure alone does not.7U.S. Small Business Administration. Get Business Insurance Basic policies come at a range of price points and add a meaningful layer of protection for a new business running lean.