An LLC (limited liability company) separates your personal assets from your business debts, gives you flexible tax options, and carries more credibility than a sole proprietorship. The good news: you can form one entirely online in most states, usually in 1–2 weeks, for a state filing fee between $35 (Montana) and $500 (Massachusetts). You don’t need a lawyer, and you don’t need to be a U.S. citizen or resident to own an LLC.
Here are the 8 steps, in order. Do them in sequence and you’ll avoid the rework that trips up most first-time founders.
Quick note: This is general information, not legal or tax advice. Filing fees and requirements change, so confirm the current numbers on your state’s Secretary of State website before you file.
Step 1: Choose Your State
Where you form your LLC matters. The simplest and usually smartest choice is the state where you actually live and do business. Forming in a “cheap” state while operating elsewhere usually means you still have to register as a foreign LLC in your home state — paying two fees instead of one.
That said, a few states are popular for specific reasons. Wyoming charges around $100 with no state income tax and strong privacy protections. Delaware is the classic pick for startups planning to raise venture capital. Nevada has no personal or corporate income tax but costs more than the $75 Articles fee suggests (more on that in the cost table below). Unless you have a specific reason to file elsewhere, your home state keeps compliance simple.
Step 2: Pick and Check Your LLC Name
Your name must include an LLC designator — “LLC,” “L.L.C.,” “Limited Liability Company,” or similar (each state lists its accepted versions). It must be distinguishable from existing businesses registered in your state, and it can’t include restricted words like “bank” or “insurance” without authorization.
Check availability on your Secretary of State’s business name search before you get attached to a name. Most states also let you reserve a name for a small fee (for example, Missouri charges $25 for a 60-day online reservation; New York charges $20) while you finish the paperwork.
Step 3: Appoint a Registered Agent
Every LLC must maintain a registered agent — a person or company with a physical street address in your state (no P.O. boxes) who receives legal documents and official mail during business hours. You can be your own agent if you have an in-state address, but that puts your home address on public records and requires you to be available all business hours.
A professional registered agent service typically costs $100–$150/year. Many founders choose one for privacy alone. If you use a formation service, registered agent service is often bundled (sometimes free for the first year).
Step 4: File Articles of Organization
This is the actual formation step. You file Articles of Organization (called a Certificate of Formation in Texas and Certificate of Organization in Pennsylvania) with your Secretary of State, almost always online. The form asks for your LLC name, registered agent, business address, and management structure (member-managed vs. manager-managed). Filing online takes 15–30 minutes.
What it costs by state (2026 examples)
| State | Filing fee | Notes |
|---|---|---|
| Montana | $35 | Among the cheapest in the country |
| Missouri | $50 | Online filing |
| Pennsylvania | $125 | Plus a $7 annual report |
| New York | $200 | Plus newspaper publication requirement |
| Texas | $300 | Filed as “Certificate of Formation” |
| Nevada | $425 total | $75 articles + $150 initial list + $200 business license |
| Massachusetts | $500 | Among the most expensive |
These are the state fees alone — what you pay if you file directly. Processing is typically a few business days online (Nevada’s SilverFlume portal can approve same-day; Texas averages 3–5 business days).
Step 5: Create an Operating Agreement
An operating agreement is an internal document spelling out who owns what percentage, how profits and losses split, how decisions get made, and what happens if a member leaves or the LLC dissolves. It’s not filed with the state — it stays in your records — but it overrides your state’s generic default rules, which may not match your intentions.
Five states legally require one: California, Delaware, Maine, Missouri, and New York (New York’s must be adopted within 90 days of filing). Everywhere else it’s strongly recommended — and for single-member LLCs, it’s practical proof that the LLC is a separate entity from you personally, which is exactly what preserves your liability protection. Most banks also ask for one when you open a business account. Free templates are widely available; a single-member version takes under an hour to complete.
Step 6: Get Your EIN From the IRS (Free)
An Employer Identification Number (EIN) is your business’s federal tax ID — think of it as a Social Security number for the company. You need one if your LLC has employees, multiple members, or elects corporate taxation, and most banks require it to open a business account.
Apply directly at the IRS website — it’s free and online applicants typically get their EIN immediately after submitting. Do not pay a third party for this; some services charge $50–$100 for what takes 15 minutes on irs.gov. Apply after your state filing is approved, since the IRS asks for your formation date.
Step 7: Handle State Taxes and Licenses
Formation isn’t the finish line. Depending on your state and business type, you may need to:
- Register for state taxes — sales tax permits, employer withholding, or unemployment insurance accounts, usually through your state’s department of revenue.
- Get business licenses — some states and cities require general business licenses; certain industries (food, construction, finance, health) have their own permits.
- File annual reports — most states require a yearly or biennial report with a small fee (Pennsylvania: $7/year; Nevada: $350/year including the business license renewal; New York: a $9 biennial statement). Put these dates on your calendar the day you form — missed reports are the most common reason LLCs get administratively dissolved.
Step 8: Open a Business Bank Account
Open a dedicated business checking account as soon as you have your EIN and formation documents. This is the step that actually protects you: mixing personal and business money (“commingling”) is the number-one way solo owners accidentally destroy their own liability shield.
Bring your approved Articles of Organization, EIN confirmation letter, and operating agreement — most banks ask for all three. If your LLC will earn online income (freelancing, e-commerce, content), pick a bank with low fees and solid online banking; many founders pair this with a business-focused checking account designed for freelancers and digital businesses. And if your content business plans to earn ad revenue, it’s worth reviewing the Google AdSense approval requirements early so your site meets the standards before you apply.
5 Mistakes That Cost New LLC Owners
- Forming in the wrong state to “save” money. Filing in Wyoming or Delaware while operating in your home state usually means double registration and double fees.
- Skipping the operating agreement. It’s free or cheap, and it’s your best evidence the LLC is genuinely separate from you.
- Paying for an EIN. The IRS issues EINs free. Any service charging for one is selling you a 15-minute form.
- Forgetting annual reports. States dissolve LLCs over missed filings more than any other cause. Set reminders.
- Commingling funds. One business account, used exclusively for business, from day one.
Should You Use a Formation Service or DIY?
Filing directly with your Secretary of State is the cheapest route — you pay only the state fee. A formation service (typically $0–$100 for the filing itself, plus upsells) earns its keep on convenience: name search, paperwork, registered agent bundling, EIN filing, and compliance reminders in one checkout. If you’re comfortable with forms and reminders, DIY is fine. If you’d rather not think about it, a service is reasonable — just understand what the “$0” headline actually includes before you click.
Either way, the timeline is similar: most online filings are approved within days, and the full process — name to bank account — takes most founders one to two weeks.
Related: 5 Best LLC Formation Services in 2026 · LLC vs S Corp for Freelancers: Which Saves More in 2026?
Official source: U.S. Small Business Administration
Frequently Asked Questions
How much does it cost to start an LLC online?
State filing fees run from $35 (Montana) to $500 (Massachusetts), with most states in the $50–$300 range. Add $100–$150/year if you use a professional registered agent, plus any annual report fees. Filing yourself costs only the state fee; formation services add $0–$100 plus upsells.
How long does it take to form an LLC online?
Online state filings are typically approved in 1–5 business days, and the full process (name search, filing, EIN, bank account) usually takes 1–2 weeks. Some states like Nevada offer same-day online approval.
Do I need a lawyer to start an LLC?
No. The process is designed for self-filing, and most solo founders do it without legal help. Consider a lawyer if you have multiple owners with complex profit-sharing, are raising outside investment, or operate in a heavily regulated industry.
Can a non-U.S. citizen start an LLC?
Yes. You don’t need to be a U.S. citizen or resident to own an LLC. You’ll need a registered agent with a U.S. address in your formation state, and non-residents apply for an EIN by fax, mail, or phone rather than the online portal.
Is an operating agreement really necessary for a single-member LLC?
It’s not legally required in most states, but yes — get one anyway. It’s your best evidence that the LLC is a separate entity from you, which is the whole point of the liability protection, and most banks want to see it when you open a business account.
LLC vs. sole proprietorship — which is better?
An LLC gives you liability protection and more tax flexibility; a sole proprietorship is free to start but leaves your personal assets exposed to business debts and lawsuits. For most online businesses earning real revenue, the LLC’s protection is worth the filing fee. (This is general information, not professional advice — your situation may differ.)