Arkansas LLC costs: summary
The cost of starting an LLC in Arkansas is considered relatively inexpensive compared to other states. That being said, this is a quick overview of the various state fees you will be required to pay. The list should prove helpful when creating a new business budget.
| Item | Cost |
|---|---|
| LLC filing fee | $45 online, $50 by mail |
| Business license | Differs by industry and municipality; sales tax permit $50 |
| Registered agent service (optional; an agent is required) | $50 to $300 per year |
| Reserve business name (optional) | $22.50 online, $25 by mail |
| Filing a DBA (optional) | $22.50 online, $25 by mail |
| Operating agreement (optional) | $0 DIY or can be up to $1,000 if using a lawyer |
| Annual franchise tax report | $150, due May 1 |
Initial costs when forming an Arkansas LLC
Starting a legally recognized entity tasks professionals with following a step-by-step Arkansas LLC formation process. First-time business owners sometimes make errors that result in timeline and financial setbacks. The following covers the broad strokes of starting an organization and the fees associated with an Arkansas LLC.
Costs for naming your Arkansas LLC
You can conduct an Arkansas business entity search on the Secretary of State’s website at no cost. Enter the name you hope to establish an LLC under and other pertinent information and click search. If the platform doesn’t produce a hit, the entity name is likely available. You can reserve the name by filing an Application for Reservation of a Limited Liability Company Name online or on paper. The state will set aside the name for 120 days for $22.50 online or $25 by mail.
Initial filing fees
Once you have a viable business entity name, you can take the next step: filing your Certificate of Organization. This document establishes the legal basis for your Arkansas LLC. After the paperwork has been processed, you’ll receive an official notice from the state signaling that you can begin operations.
The fee for the Certificate of Organization is $45 for an online filing and $50 if mailed. Online filings typically take 2 to 4 business days, and mailed filings can take up to 2 weeks. If you need certified copies of your business documents, the Secretary of State charges $0.50 per page plus $5 per certificate.
Registered agent costs
Every Arkansas LLC must have an Arkansas registered agent. You can serve as your own agent for free, but many businesses choose a professional service. Working with a registered agent service provider can save you a great deal of time and energy. A registered agent receives and forwards essential documents and provides a physical Arkansas address for legal notices. Business owners also enjoy a needed layer of privacy. Hiring a reliable registered agent service typically costs $50 to $300 per year, depending on your Arkansas LLC needs.
Operating agreement costs
Arkansas doesn’t require a written operating agreement; it can be written, oral or implied, and it isn’t filed with the state. Still, a written Arkansas LLC operating agreement is a good idea. Hiring an attorney to write an Operating Agreement for your Arkansas LLC could run over $1,000. If you decide to take a crack at it, law firms will likely charge you about $500 to review it to ensure it meets all of the legal requirements. If it doesn’t, you could end up spending a significant amount of time and paying another review fee. It’s not uncommon for entrepreneurs to use a dependable online operating agreement creation service. The cost is generally far lower than hiring a lawyer, and a professional platform will save you time.
Annual and recurring Arkansas LLC fees
If you decide to conduct operations under a name other than your official LLC name, Arkansas allows businesses to file for a fictitious name, sometimes called a “doing business as” or DBA. You’ll need to fill out and file an Application for Fictitious Name and pay a $22.50 online fee. The cost is $25 by mail or in person. Canceling or transferring a fictitious name costs $25.
At some juncture, you may need an Arkansas Certificate of Good Standing (called a certificate of existence for Arkansas LLCs). The official document demonstrates to banks and lenders that your LLC is active and current on its state filings. The fee is $15.
In the event you desire to terminate your LLC, you will need to file a Statement of Dissolution. This document helps protect against unauthorized use of your business entity’s name, debt accumulation, and other risks. A digital filing costs $45, and a paper filing costs $50. You must also file a final franchise tax report with it, which costs $150.
Franchise tax
Every Arkansas LLC pays an annual franchise tax of $150, filed with the annual franchise tax report by May 1. Your first report is due May 1 of the year after your LLC is formed. If you file late, you’ll owe a $25 penalty plus daily interest (about 10% a year) on the tax and penalty.
Business licenses & permits
An Arkansas LLC that requires a Sales and Use Tax Permit will incur a $50 fee, payable to the Arkansas Department of Finance and Administration. The cost of professional and local licenses and permits varies by industry and location, from relatively modest fees to more than $1,000. Check with state and local license and permitting agencies to determine the licenses and permits needed to start your venture, and see our guide to Arkansas business license costs.
Annual report
A variety of states task business owners with filing annual reports. In Arkansas, LLCs don’t file a separate annual report. The Arkansas annual franchise tax report serves that purpose, and it’s where you update your LLC’s registered agent, members or managers, and contact details each year.
What expenses you can write off
If there’s a silver lining to outlaying this start-up cash, it’s that the majority of costs are tax deductible. It’s highly likely that the filing fees and price of a registered agent, professional Arkansas LLC formation expenses, and others will reduce your tax liability. These are estimates of what you may be able to write off at the end of the year.
- Cost of Completing the Certificate of Organization: The state charges $45 for online filings and $50 through the mail. These fees and the expense of hiring a professional LLC services provider lower your taxable income.
- Filing Fees: The filing fees for items such as a franchise report run $150. This cost may be tax deductible based on your business entity structure and tax position.
- DBA Fees: Acquiring a fictitious name adds $22.50 to $25 to your startup and filing costs.
- Operating Agreement Costs: The cost of a DIY operating agreement ends up costing more than hiring a professional LLC service provider. Lawyers can charge $500 just to look it over and $1,000 to fill out a template on your behalf. An LLC service charges far less, and you can write it off as a business expense.
- Registered Agent Costs: A registered agent service typically charges $50 to $300 per year, depending on the extent of the necessary services. Again, the IRS considers this the cost of doing business.
- Attorney Fees: A law firm can charge entrepreneurs thousands of dollars to form an Arkansas LLC. While generally a tax write-off, you can minimize that expense by outsourcing to a reliable online Arkansas LLC formation provider.
LLC state filing fees
Here are the domestic LLC filing fees as detailed in the Arkansas Secretary of State’s site:
| Form | Online Fee | Paper Fee |
|---|---|---|
| Certificate of Organization for a Dom. Limited Liability Co. | $45.00 | $50.00 |
| Certificate of Amendment to Certificate of Organization for a Dom. Limited Liability Co. | $22.50 | $25.00 |
| Application for Reservation of a Limited Liability Company Name | $22.50 | $25.00 |
| Notice of Transfer of Reserved Name for LLC | $22.50 | $25.00 |
| Application for Fictitious Name Dom. Limited Liability Co. | $22.50 | $25.00 |
| Cancellation of Fictitious Name Dom. Liability Co. | N/A | $25.00 |
| Transfer/Cancellation of Fictitious Name for Dom Limited Liability Co. | N/A | $25.00 |
| Final Franchise Tax Report (Must be submitted with form LL-04, Statement of Dissolution) | $150.00 | $150.00 |
| Franchise Tax Registration (use with form LL-01) | N/A | No Fee |
| Statement of Dissolution | $45.00 | $50.00 |
| Statement of Revocation of Dissolution for LLC | N/A | $25.00 |
| Statement of Authority, Amendment, Cancellation or Denial for LLC | N/A | $25.00 |
| Articles of Conversion | N/A | $25.00 |
| LLC Certificate of Transfer of Domicile (Domestication) from Arkansas | N/A | $50.00 |
| Amended LLC Franchise Tax Report (current year) | N/A | No Fee |
| Notice of Change of Registered Agent for LLC | No Fee | No Fee |
| Notice of Change of Principal Office Address for LLC | No Fee | No Fee |
Conclusion
The cost to start an LLC in Arkansas ranks among the lowest in the nation. Filing fees and document creation are generally written off on tax filings. However, savvy business leaders can take advantage of budget-friendly online Arkansas LLC formation services and put their time and energy into marketing the brand and attracting customers.
FAQ
The state filing fee for forming an LLC in Arkansas is $45 for online submissions and $50 for paper filings.
Arkansas LLCs must pay a $150 annual franchise tax, due May 1 each year, to remain in good standing with the state.
Yes, you can reserve your LLC name for 120 days by filing a name reservation application and paying a $22.50 fee online ($25 by mail).
Every Arkansas LLC must designate a registered agent, which can be yourself at no cost or a third-party service typically ranging from $50 to $300 per year.
Forming an Arkansas LLC costs at least $45 online. After that, you’ll pay the $150 annual franchise tax each year, starting May 1 of the year after your LLC is formed.