Planning to start a Pennsylvania LLC? Discover practical tips for reducing expenses and fees, ensuring your small business stays within a budget.
Ready to start your business? Plans start at $0 + filing fees.
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by Rudri Bhatt Patel
Rudri Bhatt Patel is a former attorney turned writer and editor. Prior to attending law school, she graduat...
Updated on: September 23, 2024 · 11 min read
If you’re contemplating forming a Pennsylvania LLC, you might ask, "How much is an LLC in PA?" The basic cost is $125, which is the LLC filing fee. Other fees can increase the cost of creating an LLC, but that's the minimum.
Some aspiring business owners may want to start a limited liability company (LLC) but may think it is expensive or the rules are too complicated. LLCs are actually easy to establish in Pennsylvania.
Pennsylvania is home to over 1 million small businesses. These entities employ over 2.5 million individuals across the state.
Check out this comprehensive guide on obtaining a Pennsylvania LLC certificate, including how much it costs to register a Pennsylvania LLC.
The purpose of the formation filing is to register your business with the state and to form an LLC. This filing allows the business to be recognized as a legal entity and to operate under the laws of Pennsylvania. It also protects your personal assets by separating them from your business.
The primary legal document to form an LLC is the Certificate of Organization, which includes the name of the Pennsylvania business, the address of the registered office, and the names of the organizers of the business.
The filing fee is $125.
In Pennsylvania, the Articles of Organization are also called the Certificate of Organization. This filing will help establish your business as a legal entity.
The Certificate of Organization will include the following and help you to form an LLC:
The full legal name of the small Pennsylvania business. The business name must be distinguishable from other entities in your Certificate of Organization. It also should include limited liability company, LLC, or L.L.C. at the end of the business name.
The physical address where all legal documents and correspondence should be sent.
The filing date should be the effective date of when your LLC was formed. This should be listed in your Certificate of Organization.
These are the names of the individuals or entities that form the Pennsylvania LLC.
Typically, this information is optional, but it is recommended you list whether the Pennsylvania LLC is member-managed or managed by managers in your Certificate of Organization. It can also list whether it is a single member LLC or a multi member LLC.
Signatures of the person or persons filing the Certificate of Organization.
According to the Pennsylvania Department of State, the filing fee is $125 for your Certificate of Organization.
However, there may be an additional fee for expediting the process. This ranges from $100 to $1,000 depending on how fast you want your documentation or Certificate of Organization to be processed.
Pennsylvania requires LLCs to file a decennial report. This report must be filed every 10 years to show that the Pennsylvania LLC is active.
The cost to file a decennial report is $70. However, the decennial report requirement expires at the end of 2024, according to the Department of State.
A registered agent is a crucial part of an LLC’s business operation. A registered agent can be an individual or entity that is responsible for accepting all legal documentation and correspondence on behalf of the business.
You want to make certain your registered agent is reliable and trustworthy.
A registered agent has the following responsibilities: a) accepting legal documentation which may include subpoenas, legal notices, and other important correspondence, b) forwarding the documents to the appropriate individual in the Pennsylvania LLC promptly, c) receiving government correspondence, and d) always maintaining a physical address.
The registered agent cannot have a P.O. box as an address, according to the Pennsylvania Department of State.
The cost of a registered agent in Pennsylvania LLC can vary and depends on the level of service offered. It can have a $50 to $300 annual fee. You can save money by being your own registered agent for free.
A seller’s permit authorizes an LLC to collect sales tax for products or services that it sells in Pennsylvania.
In Pennsylvania, there is no charge to obtain a Pennsylvania seller’s permit. The permit can be applied for via the Pennsylvania Department of Revenue's online systems, such as e-TIDES.
Pennsylvania doesn’t require general business licenses to conduct business in the state. While there isn't a Pennsylvania business license to obtain, your industry may require you to obtain additional licenses, like a sales tax license, to operate your small business in Pennsylvania.
Depending on your Pennsylvania LLC’s business focus and industry, these guidelines will help you determine license costs:
The range of these Pennsylvania business license fees could range from $25 to $500 or more.
Starting in 2025, Pennsylvania LLCs will have to file a report that is accompanied by an annual fee. The annual report should include the following:
The new annual fee is $7 for limited liability companies. The deadline for limited liability company annual filings (domestic and some foreign entities) is Sept. 30, and the annual report of any other domestic filing entity or foreign filing association is due by Dec. 31 of each year.
The cost of business insurance varies depending on the industry, type of business, location, and specific coverage requirements. Here is a list of potential business insurance you may need (depending on the type of business):
Liability protection insurance protects you from claims of bodily injury, property damage, and personal injury that may result from your business operations.
The cost of this insurance ranges from $300-$1,000 per year.
Purchasing this insurance for your LLC in Pennsylvania protects you from damage to your business property, including buildings, equipment, and inventory due to events like fire, theft, or natural disasters.
The cost of this insurance is generally $500-$2,500 annually.
If you’re a small business with employees, Pennsylvania law requires that you purchase worker’s compensation insurance. This covers employees' medical expenses and lost wages if they become injured or ill due to their job.
This insurance protects against any errors or omissions in services you provide in your Pennsylvania LLC. The professional services that usually have this type of insurance are lawyers, physicians, consultants, accountants, real estate agents, architects, and health care professionals or individuals working in veterinary medicine. The cost of this professional services insurance varies and can range from $500 to $3,000 per year.
If you use a vehicle for business purposes, it is a good idea to have commercial auto insurance. This insurance covers liability and physical damage coverage. The cost of this insurance is $750 to $2,000 per vehicle.
A franchise tax is the cost the government charges for doing business in their state.
Prior to 2016, franchise taxes were imposed on all corporations and charitable organizations with capital stocks, joint-stock associations, business trusts, LLCs, and all other entities classified as corporations for federal business income tax purposes that were formed or did business in Pennsylvania.
After 2016, the franchise tax was eliminated for Pennsylvania LLCs.
When you start a business there are various costs that you may encounter as you establish your business. Here are some of those Pennsylvania LLC costs:
To protect your business name or logo, you may want to file for a trademark in Pennsylvania. The cost for trademark registration is $50 under Pennsylvania law.
If you need financing, you might encounter fees associated with securing a business loan, such as origination fees or application fees.
Certain professions require state-issued licenses, which can range from $50 to $500 depending on the industry.
If you choose to advertise your business, you may want to market using print publications, online advertising, or social media posts. These limited liability costs can vary depending on how much you want to spend on marketing.
You may be asking, "How much does an LLC in Pennsylvania cost if I choose to do it on my own?" The total LLC cost to start a limited liability could be within an affordable range or could be expensive depending on how many of these steps you plan to do on your own. Here is an estimate but be aware that the total cost depends on the type and size of your business, the location, and the industry.
Registering a foreign LLC simply means your business was formed in another state or country, and now you’d like to have the authorization to conduct your business in Pennsylvania. It doesn’t necessarily mean you operated a business entity outside the U.S.
It does cost more to register a foreign LLC in Pennsylvania. To register a foreign LLC, you will need to file a Foreign Registration Statement (DSCB: 15-412) with the Pennsylvania Department of State.
The filing fee for this registration is $250, which is higher than the $125 filing fee for forming a domestic LLC in Pennsylvania. In addition, you will be required to maintain any fees or costs in the home state where your LLC is established. You will also have to set up a registered agent service in Pennsylvania, which will cost $50 to $300, depending on the level of service you would like.
If you need some help getting your small business started, there are several Pennsylvania grants that will help you reach your goal. Here are potential resources regarding grants that may help in your search:
Pennsylvania Department of Community and Economic Development
This government agency provides grants to several different types of small businesses, corporations, and charitable organizations based on specific industries or areas. One example includes the PA Minority Business Development Authority (PMBDA) which offers grants and loans to minority-owned businesses in Pennsylvania.
Federal grants
There is the possibility for grant help through federal aid. Grants.gov offers individuals an opportunity to look for federal grant opportunities. Typically, federal grants are for specific sectors and industries, but there may be some grant money available for your Pennsylvania LLC or charitable organizations.
County and city grants
Depending on what Pennsylvania city or county you live in, you may be eligible for local grants, especially if your small business generates jobs for locals and economic development.
Private foundations
Some private foundations may offer grant money if your small business is seeking to support social impact or community development.
The Small Business Development Centers in Pennsylvania are a resource you may want to consider. This organization doesn’t provide grants but offers resources on how to apply for grants and general guidelines on how to navigate the grant process.
Starting an LLC can be relatively affordable if you do the research and do many of the steps yourself.
Here is a step-by-step guide to setting up an LLC in Pennsylvania in an affordable way:
By handling most of the registration details and other tasks yourself and paying only the necessary filing fee costs, you can start an LLC in Pennsylvania for as little as $125.
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