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Last Updated on September 27, 2024 by Dr. Gabriel O’Neill, Esq.
Welcome to the exciting journey of starting a business in sunny Florida! If you’re thinking about forming a Limited Liability Company (LLC), you’re making a vital move toward entrepreneurial success.
Before jumping into the process, it’s important to understand the costs involved. These include not only the filing fees but also the ongoing financial commitments necessary to maintain your LLC.
This guide will break down all the expenses you might encounter when forming an LLC in Florida. And if you need additional support, trusted LLC services like ZenBusiness can help with the paperwork, ensuring everything is handled smoothly and accurately.
With the right information and support, you’ll be well-prepared to navigate both the financial and procedural aspects of starting your LLC in the beautiful state of Florida.
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What Is the Cost of Forming an LLC in Florida?
The primary cost to form an LLC in Florida involves the $125 charge for submitting your LLC’s Articles of Organization through the Florida Division of Corporations’ online platform.
Here’s the LLC Cost Guide for all US States:
Florida Foreign LLC Formation Costs
Should you possess an existing LLC registered in a different state and have intentions of extending your business operations to Florida, it will be necessary to enroll your LLC as a foreign entity within the state.
The expense associated with this registration procedure amounts to $125. This process entails submitting an Application by a Foreign Limited Liability Company for Authorization to Transact Business in Florida to officially register the foreign LLC in the state.
Annual Cost for LLCs in Florida
When establishing a Limited Liability Company (LLC) in Florida or exploring information about the “Florida LLC Annual Fees,” it’s crucial to consider several key factors that contribute to the upkeep of your LLC’s status and its favorable standing with the Florida Secretary of State. These fees play a pivotal role in these aspects.
The foremost fee to account for is the Annual Report Fee, which mandates Florida LLCs to file an annual report, incurring a cost of $138.75. This report must be submitted by May 1 each year to avoid late fees, as failing to do so results in a penalty of $400.
Additionally, if you opt for a registered agent service for your Florida LLC, a yearly service fee will apply. It’s important to note that the stated costs are subject to potential changes, necessitating verification of the latest fees directly from the relevant source.
How Much Does It Cost to Start an LLC in Florida With the Best LLC Service?
ZenBusiness LLC Formation Cost
Incorporating an LLC in Florida incurs an initial cost of $125 as a foundational fee, which serves as a starting point for additional charges based on specific preferences. The standard processing period for applications is set at 2 to 3 weeks. For those seeking a swifter process, there are expedited options available: a 4 to 6-day acceleration for a fee of $50 or an even faster 1 to 2-day rush for a fee of $100.
ZenBusiness provides a range of three distinct pricing plans catering to various requirements for business formation services: these are the Starter, Pro, and Premium plans.
Starter plan: Should your needs be geared towards fundamental business formation, this presents itself as a suitable choice, incurring a cost of $0 alongside state fees.
Pro plan: For a heightened level of service encompassing added features such as expedited filing and registered agent service, the stands as an attractive option, requiring a fee of $199 in addition to state fees.
Premium plan: The most comprehensive offering, designated as the, builds upon the Pro plan by encompassing all its features while introducing the invaluable component of unlimited Worry-Free Compliance. This facet serves to facilitate businesses in their adherence to both state and federal regulations. To secure these advantages, an investment of $349 plus state fees is entailed.
Notably, ZenBusiness extends the proposition of a complimentary year of Worry-Free Compliance with the procurement of any of the aforementioned plans.
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Additional Costs When Starting an LLC in Florida
Florida LLC Name Costs
The expense of naming your business in Florida is $0. When your Articles of Organization filing is accepted by the state, your chosen Florida LLC Name will be approved without any additional charges.
There might be information online suggesting the necessity of LLC Name Reservations, but this is generally inaccurate for the majority of states. Forming an LLC typically doesn’t demand a Name Reservation.
For Florida LLCs, the option exists to reserve a business name by preparing and submitting a letter to the Division of Corporations with the preferred name. This action will secure the name for a duration of 120 days.
Florida Registered Agent Costs
Florida law mandates designating a registered agent upon establishing your LLC, with an associated fee of either $0 or $125 annually. The registered agent, either an individual or a company, is responsible for receiving official documents and state notifications on behalf of your LLC. It’s necessary for the registered agent to possess a physical address within the state and be accessible during regular business hours.
Opting to serve as your own registered agent or designating a familiar individual incurs no extra charges. Nevertheless, you have the alternative of engaging a registered agent service, typically costing between $100 and $300 per year. These services often provide additional beneficial business-related amenities and can safeguard your confidentiality.
Regardless of your choice, there’s no separate fee for the registered agent when submitting your LLC formation paperwork to the state.
Selecting a registered agent service is advisable if:
- You lack an address within the state (Florida law mandates that registered agents possess a physical state address).
- You wish to prevent your address from appearing in public records (certain service providers might allow you to employ their address to maintain your privacy).
Florida Operating Agreement Costs
A fee isn’t applicable for the LLC Operating Agreement in Florida.
An LLC Operating Agreement in Florida serves as a documented agreement between the members of the LLC, containing comprehensive particulars regarding ownership, management of the LLC, and the methodology for profit allocation. Both Single-Member LLCs and Multi-Member LLCs are advised to create an Operating Agreement, maintain it within their business documentation, and provide each member with a copy.
The majority of online platforms typically impose a cost ranging from $50 to $200 for the preparation of LLC Operating Agreements.
Florida EIN Cost
An Employer Identification Number (EIN), also referred to as a Federal Employer Identification Number (FEIN), serves multiple purposes, such as filing income taxes, establishing an LLC bank account, and facilitating employee hiring if needed. Despite several websites charging a service fee for obtaining an EIN for your LLC, it’s possible to acquire it for free.
The Internal Revenue Service (IRS) offers a quick and straightforward online filing process that enables you to obtain an EIN for your LLC at no expense within a matter of minutes.
Florida LLC Taxes
The range of annual costs for Florida LLC owners can greatly differ due to the various types of taxes they’re required to pay. These taxes encompass:
Federal Income Taxes
When it comes to federal income taxes, the treatment of your LLC by the IRS can vary based on different factors. For Single-Member LLCs, the IRS considers them as Disregarded Entities, which means the LLC itself doesn’t need to file a federal income tax return. Instead, the owner of the LLC files the return and pays the taxes.
The tax method depends on the LLC’s owner, either as a Sole Proprietorship for individual ownership or as a branch/division of the parent company for corporate ownership.
Multi-Member LLC Taxes
For LLCs with multiple owners, the IRS treats them as Partnerships for tax purposes. The LLC must file a 1065 Partnership Return and provide a Schedule K-1 to the owners. Schedule K-1 details each owner’s share of profits, and this income is reported individually by each owner on their personal tax return (Form 1040).
Husband and Wife LLC Taxes
In certain states like Texas, a husband and wife who co-own an LLC can choose to be taxed as a Single-Member LLC, also known as a Qualified Joint Venture. This option isn’t available in non-community property states like Florida.
Electing Corporate Taxation
Beyond the default tax statuses, an LLC can opt for corporate taxation. There are two types of corporate elections: S-Corporation and C-Corporation.
An S-Corporation election, made by filing Form 2553, can help businesses save on self-employment taxes. On the other hand, a C-Corporation election, filed via Form 8832, is less common and can benefit larger employers in terms of healthcare benefits.
Federal LLC Payroll Taxes
If your LLC has employees, you must handle payroll taxes, which include federal income tax withholding, Social Security tax, Medicare tax, Federal Unemployment Taxes (FUTA), and possibly state unemployment taxes. Employers are responsible for setting up payroll, withholding taxes, and submitting the necessary filings to the government.
In Florida, withholding taxes are submitted at the federal level, while employers must register for the Florida Reemployment Tax.
Florida State Income Tax
Florida doesn’t impose a state-level income tax. Single-member LLCs in Florida don’t need to file a state income tax return. However, Multi-Member LLCs might need to file a Florida Partnership return (Form F-1065). Certain industries and business types might be subject to other Florida business taxes.
Local Income Tax
Depending on your location, you might need to pay local income taxes for yourself and/or your LLC. It’s recommended to engage an accountant for assistance and to check with your local municipality for specific requirements.
Florida Sales Tax
When selling products to consumers in Florida, you might be required to collect sales tax using a Seller’s Permit obtained from the Florida Department of Revenue. This permit allows you to charge sales tax on retail transactions. You’ll need to register online and file a Sales and Use Tax Return annually. More information can be found on the Florida Department of Revenue website.
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Florida LLC Cost FAQs
How Much Does It Cost to Open an LLC in Florida?
Initiating a Florida LLC necessitates a payment of $125. This fee corresponds to the singular filing of the Articles of Organization for the LLC in Florida.
For specific LLCs, obtaining a business license in Florida might be necessary. The applicability of this requirement is contingent upon the sector in which your LLC operates and its geographical location. The expenses linked to acquiring local business permits exhibit variability.
How Much Does an LLC in Florida Cost Per Year?
Florida LLCs are obligated to submit a yearly payment of $138.75 for the Florida Annual Report, which is remitted to the Department of State and constitutes the solitary essential state-based annual fee crucial for maintaining the LLC’s active status.
In addition, if you’ve enlisted the services of a registered agent, an annual subscription fee of approximately $125 will be due. Additionally, the necessity for a business license in Florida hinges on the industry and geographical location of your LLC, and potential recurring charges for permit renewal can be verified with your local municipality.
Should I Hire an LLC Formation Service?
Engaging a professional service provider to establish your Florida LLC is optional; self-filing is permissible. Nonetheless, for efficiency and accurate filing, we suggest considering ZenBusiness.
Renowned for its exceptional customer support, ZenBusiness offers complimentary registered agent services for the initial year, along with supplementary offerings such as an Operating Agreement and assistance with Annual Report submission.
Conclusion
In summary, forming an LLC in Florida requires thoughtful planning around the associated costs. Along with filing fees and registered agent charges, there may also be legal or consulting expenses to consider. However, Florida’s favorable business environment, lack of state income tax, and support from services like ZenBusiness make it an attractive option.
Entrepreneurs should balance these expenses with Florida’s business advantages, such as its strong legal framework and industry reputation, to decide if forming an LLC in the state aligns with their goals and budget.
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About the author
Dr. Gabriel O'Neill, Esq., a distinguished legal scholar with a business law degree and a Doctor of Juridical Science, is a leading expert in business registration and diverse business departments. Renowned for his academic excellence and practical insights, Dr. O'Neill guides businesses through legal complexities, offering invaluable expertise in compliance, corporate governance, and registration processes.
As an accomplished author, his forthcoming book is anticipated to be a comprehensive guide for navigating the dynamic intersection of law and business, providing clarity and practical wisdom for entrepreneurs and legal professionals alike. With a commitment to legal excellence, Dr. Gabriel O'Neill, Esq., is a trusted authority dedicated to empowering businesses within the ever-evolving legal landscape.