Tennessee LLC Cost

Forming a limited liability company (LLC) in Tennessee involves a minimum cost of $300, which is the filing fee to submit your LLC’s Articles of Organization.

However, the overall cost of starting a Tennessee LLC can vary depending on your personal choices, as well as on the number of LLC members that are involved.

This Tennessee LLC Cost article provides a thorough breakdown of all the potential expenses associated with establishing and maintaining an LLC in Tennessee.

More than 84% of our readers form their LLC through a professional service to save time and avoid mistakes.

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How Much Does a Tennessee LLC Cost

Below is a table summarizing the primary expenses involved in forming an LLC in Tennessee.

	LLC Cost Summary
Requirement	Fee
Articles of Organization	$300-$3000
Registered Agent	$0-$150+
LLC Name	$0-$40

Tennessee LLC Filing Fee ($300)

In Tennessee, the first mandatory step in forming your LLC is filing the Articles of Organization with the Secretary of State.

This filing officially registers your LLC within the state and has a fee that varies depending on the number of members your LLC has; a $50 fee is imposed per LLC member, with a minimum cost of $300 and a maximum of $3,000.

For those opting to use a professional LLC formation service, additional service fees will also further increase the total cost. These services typically start at around $29, though this cost can rise if you choose to add any extra features.

Have a look at our in-depth review of the best and most affordable LLC Formation Services in 2024. 

Tennessee Registered Agent ($0-$150+)

As part of the LLC formation process in Tennessee, appointing a registered agent is a legal requirement. This is an individual or entity designated to receive legal, tax, and governmental correspondence on behalf of your LLC.

Your LLC’s registered agent must either be a resident (if a person) or authorized to do business in Tennessee (if any entity). 

They must also have a physical office address within the state where they can accept service of process during standard business hours.

While it is possible to serve as your own registered agent at no additional cost, many business owners prefer to hire a professional service as it keeps their personal information private and helps to ensure compliance with state regulations.

The cost for a registered agent service can vary widely, typically ranging from $120 to $300 per year, depending on the level of service and support offered.

Tennessee LLC Name ($0-$40)

While naming your LLC doesn’t incur a direct cost, there are two potential expenses related to this step that you should keep in mind. 

Reserving a Name

To ensure that your desired business name is available and prevent others from claiming it, you may choose to reserve the name.

To do this, you’ll need to complete Form SS-9425 and submit it to the Secretary of State’s Business Services Division, accompanied by a $20 filing fee. Once processed, your desired name will be reserved for up to 120 days.

It’s advisable to select a name that not only meets state requirements but also has an available domain name, as having a corresponding domain helps to create consistency across your brand’s online presence — which enhances your recognition and credibility.

Doing Business As (DBA) Name

If you plan to operate your LLC under a name different from its official legal name, you will need to register a Doing Business As (DBA) name, which is also known as an Assumed Name in Tennessee.

To do so, you must submit an Application for Registration of Assumed Name to the county clerk where your business is primarily located and pay a $20 filing fee. Once this request has been processed, the DBA registration will be valid for up to five years.

Before filing, we recommended verifying the availability of your chosen DBA name on the Tennessee Secretary of State’s website in order to avoid wasting time and money.

For specific county clerk contact information, we recommend visiting the Tennessee Department of Revenue’s website.

Optional Tennessee LLC Formation Costs

Beyond the standard costs associated with forming an LLC, there are several other potential expenses that your business might encounter.

We’ve explored each of these key costs in the sections below.

Local Business Licenses

In Tennessee, any in-state business generating over $10,000 annually is required to obtain a state business license, which carries a $15 fee. Additionally, depending on the nature of your business, you may need to acquire one or more municipal licenses.

For instance, an LLC offering delivery services in Nashville would be required to obtain a specific license from the city, which costs $150.

It's crucial to check with your local city or county office to ensure that your business complies with all necessary licensing requirements in order to avoid sanctions and/or other legal penalties.

Certificate of Existence

A Certificate of Existence (also known as a Certificate of Good Standing) is often required by banks when opening a business account or by lenders to verify that your LLC is properly registered and legally authorized to do business in Tennessee.

You can request this certificate through the Tennessee Secretary of State’s website, but you will need to pay a $20 filing fee.

Additionally, an extra service fee applied to online transactions further increases the cost of obtaining this certificate. This extra service fee — which varies from $0.95 to 2.29% — is in place to help cover the costs of offering these online services.

Certified Copies of Business Documents

Certified copies of your LLC’s business documents may be required when dealing with financial institutions, working with regulatory bodies, or in legal matters.

To obtain these certified copies, you must submit Form SS-4461 to the Secretary of State and pay a $20 fee for each set of documents requested.

Tennessee LLC Operating Agreement

Although not legally required in Tennessee, it’s highly recommended that LLCs create an operating agreement.

This internal document outlines the roles, responsibilities, and operational procedures of the LLC’s members or managers, providing a clear framework for managing the business and resolving disputes.

It will cost you nothing to complete this step if you choose to draft this document yourself. However, you can also hire a professional service or business attorney to draft this document if you’re more comfortable with this, which typically costs several hundred dollars.

It’s important to note that while the operating agreement is a critical document for your LLC’s internal governance, it does not need to be filed with the Tennessee Secretary of State.

Ongoing Costs to Maintain a Tennessee LLC

Once your LLC is formed, there are several ongoing costs that you will need to budget for to keep your business in compliance with state regulations.

Annual Report Fee

To maintain your LLC’s good standing with the state, you’re required to file an Annual Report with the Secretary of State. This report must be submitted online by the first day of the fourth month following the close of your LLC’s fiscal year.

The filing fee for the annual report is calculated based on the number of members in your LLC, with a charge of $50 per member. The minimum fee is set at $300, while the maximum is set at $3,000.

Additionally, any changes that you make to your LLC’s registered agent or registered office will incur an extra $20 fee.

Note: Failing to file the annual report on time can result in penalties and may jeopardize your LLC’s standing with the state, so be sure to meet this requirement each year.

Franchise Tax

In Tennessee, all LLCs are required to pay a franchise tax, regardless of whether they are chartered, qualified, registered, or actively conducting business within the state.

The franchise tax is due annually and is calculated based on 0.25% of either your LLC’s net worth or the value of its real and tangible property in Tennessee (whichever is greater).

The minimum franchise tax is set at $100 — which applies to all LLCs, regardless of their revenue or operational status.

To comply with this requirement, you must file the Franchise and Excise Tax Return with the Tennessee Department of Revenue by the 15th day of the fourth month following the end of your LLC’s fiscal year.

Registered Agent Maintenance

If you decide to use a professional registered agent service for your LLC, you will need to pay an annual fee to maintain their services. This fee generally ranges from $120 to $300 per year, depending on the provider and the level of service offered.

While it’s not mandatory to hire a professional registered agent, doing so can provide peace of mind by ensuring that your legal documents are handled correctly and that your business remains in compliance with state regulations.

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Tennessee LLC vs Other States

The per-member fee structure for the Articles of Organization, combined with the annual franchise tax, can make Tennessee an extremely expensive state for forming an LLC. 

That said, it’s crucial to recognize that the best state to form your LLC in is generally the one where you plan to operate your business from. 

This is because this ensures that you will only need to comply with one state’s regulations, and can end up saving you both time and money.