North Carolina LLC costs: summary
| Item | Cost |
|---|---|
| State filing fee (Articles of Organization) | $125 |
| Online card fee | $3 ($2 if you pay by bank transfer) |
| Business license | Varies by industry and location; check with the state licensing board for your industry and your city or county. |
| Registered agent service (optional) | $50–$300 per year |
| Reserve a business name (optional) | $10 |
| File a DBA (optional) | $26 |
| Operating agreement (optional) | $0–$1,000 |
| Annual franchise tax (only applies to some LLCs that pay federal taxes as corporations) | $200 minimum; $1.50 per $1,000 of tax base |
| Annual report | $200, plus a $3 card fee online ($2 by bank transfer) |
If you’re considering starting an LLC in NC, you’ve probably already heard about the advantages. Having an LLC may help protect you from personal liability if your business gets sued, and it can enhance your branding, making your small business seem more polished, professional, and established.
Many people, even knowing the advantages, may hesitate to set up an LLC because they think it will be difficult and expensive to get started. But it’s not that hard if you know what to do! Even better, you can use an LLC formation service like the one we offer here at Tailor Brands and let someone else do the heavy lifting and take care of the details.
As for the cost of an LLC, that varies a lot from one state to another. If you want to set up your LLC in North Carolina, you’re in luck. The LLC North Carolina cost is reasonable.
Initial LLC costs in North Carolina
Mandatory initial costs
Filing articles of organization: $125
To form your LLC, you file a form called the “Articles of Organization” with the North Carolina Secretary of State. You can fill out the form online or download it from the State’s business registration forms page. The state filing fee is $125, plus a $3 online card fee ($128 total). The online fee is $2 instead of $3 if you pay by bank transfer. Expedited processing is available for $100 (24-hour) or $200 (same-day).
Optional initial costs
Reserving a business name: $10
One of the first things you’ll need to do to form your LLC is select a name for your business. The name must contain “limited liability company,” “LLC,” “L.L.C.,” “Ltd. Liability Company,” “Ltd. Liability Co.,” or “Limited Liability Co.” It’s free to do a North Carolina business entity name search on the Secretary of State’s website to see if your chosen name is available.
If you want to reserve your business name, you can file an application with the North Carolina Secretary of State and pay a filing fee of $10. The reservation lasts 120 days and can’t be renewed.
The name you choose when you form your LLC will be the official legal name of your LLC. You’ll use it when paying taxes and for other official matters.
Filing a DBA name: $26
You might want to have one or more other names that you can use for your business. This is totally optional, but for some businesses, it might be a good thing to have a different name or names to enhance the branding of your business.
You can’t just make up a name and use it, though. You have to register this name (or names) with your county register of deeds as a “doing business as” (DBA North Carolina) name, or, as it’s usually called in the Tar Heel state, an assumed business name.
To register a DBA, first do a search in the State’s assumed business name database to see if your desired name is already being used. This search is free.
Next, fill out an assumed business name certificate form and file it with the register of deeds in a county where your LLC does or will do business. One filing can cover several counties and up to five names, for a $26 fee.
Appointing a registered agent: $0–$300 per year
North Carolina requires you to appoint a registered agent. This is a person or business that will receive legal papers and official notices for your LLC. The registered agent must be:
- An individual residing in North Carolina whose business office is the registered office, or
- A domestic corporation, nonprofit corporation, or LLC with a business office identical to the registered office, or
- A foreign corporation, nonprofit corporation, or LLC authorized to do business in North Carolina and has a business office identical to the registered office.
You can choose to be your own North Carolina registered agent. If you go that route, it won’t cost you anything. But you may find it more convenient to use a registered agent service, like the one we provide here at Tailor Brands for our LLC customers, to save time and ensure that your important documents are handled promptly.
Registered agent services typically cost $50–$300 per year. Tailor Brands’ registered agent service is $199 per year.
Creating an operating agreement: $0–$1,000
State law doesn’t require a written North Carolina LLC operating agreement (written, oral or implied agreements are all allowed), but we recommend that you have one. An operating agreement puts in writing all the important information about how your LLC will be run, including items such as policies for how profits and losses will be distributed, procedures for admitting new members, and the responsibilities, powers, and rights of members. If you have more than one member in your LLC, the operating agreement forms a binding contract between all the members.
An operating agreement helps prevent and resolve disputes in multi-member LLCs and gives added credibility to LLCs, especially those that have only one member. This extra credibility may help distinguish your LLC from a sole proprietorship or partnership and help strengthen your protection from personal liability.
Also, when you have an operating agreement, you get to choose the rules for running your business. Without one, you’ll have to use the default rules for the state, which may not suit your purposes as well.
If you feel comfortable writing your own operating agreement, then you can do that at no cost. Or, you could hire a lawyer to write it, which would cost up to around $1,000.
A third option is to use Tailor Brands to form your LLC. We include an operating agreement as part of our LLC packages.
Annual and Ongoing North Carolina LLC Costs
Mandatory ongoing costs
Annual report: $200
Most LLCs in the state must file a North Carolina annual report and pay a fee by April 15 each year, starting the year after you formed the LLC. You can fill out the form and file it online or download a PDF, fill it out, and mail it or bring it to the Secretary of State’s office in person. The fee is $200, plus a $3 card fee if you file online ($2 by bank transfer). Professional LLCs don’t file this report.
Franchise tax: $200+
The annual franchise tax is a tax that North Carolina collects from corporations (and LLCs taxed as corporations) that are doing business within the state.
If the IRS treats your LLC as a corporation for federal tax purposes, you may need to file a North Carolina corporate income and franchise tax return. You should check with a tax or legal advisor, but most LLCs probably won’t fall into this category and won’t have to pay a franchise tax.
For LLCs taxed as C corporations, the franchise tax is $1.50 per $1,000 of tax base (generally net worth), with a $200 minimum and a $500 maximum on the first $1 million. For LLCs that pay federal taxes as S corporations, the rate starts at $200 for the first million dollars of the business’s tax base and goes up from there.
Business licenses & permits: Cost varies
A business license gives your LLC the right to conduct business in a certain area. In North Carolina, the state doesn’t require a general statewide business license, but you may need an NC business license or permit for certain activities in your county, city, or town. Most North Carolina cities no longer charge a general business license fee.
You may also need state and/or local licenses or permits to conduct certain types of businesses or certain types of business activities. Depending on what kind of business your LLC engages in, you could end up needing several licenses or permits, or none at all.
North Carolina issues hundreds of state licenses and permits. That’s in addition to local licenses and permits from counties, cities, and towns. This may sound overwhelming, but free help is available from business advisors, or you can search a database of state licenses, also for free.
The cost of licenses and permits in North Carolina varies widely. Some don’t have any fees at all, while others cost hundreds of dollars. Check current fees with the state agency, licensing board, or local government that issues the license.
Starting in 2015, the fee for most local privilege licenses (general business licenses) was eliminated. There are still local license fees for operating cabs and limos and for selling beer and wine.
You’ll probably need to file a Certificate of Registration with the North Carolina Department of Revenue to get a sales and use tax number, sometimes called a seller’s permit, but there is no charge for this.
Aside from the seller’s permit, the most common permits in North Carolina include building permits, zoning permits, and environmental permits. The most common licenses include local business licenses, professional and occupational licenses, licenses to sell alcohol, and licenses for specific types of businesses.
What Expenses You Can Write Off
The good news is that you can deduct most of your LLC formation costs from your federal taxes. Items you can deduct may include:
- State filing fees
- DBA (assumed business name) fees
- Operating agreement costs
- Registered agent costs
- Attorney fees
Still other fees and costs might qualify as write-offs. A tax professional can help you evaluate other expenses to see whether they meet the requirements for a business deduction.
North Carolina Extended LLC State Fees
The following fees are taken from North Carolina’s Secretary of State site:
| Item | Cost |
|---|---|
| Articles of Organization | $125.00 |
| Application for Reserved Name | $10.00 |
| Notice of Transfer of Reserved Name | $10.00 |
| Application for Registered Name | $10.00 |
| Application for Renewal of Registered Name | $10.00 |
| Limited Liability Company’s Statement of Change of Registered Agent and/or Registered Office | $5.00 |
| Agent’s Statement of Change of Registered Office for each Affected Limited Liability Company | $5.00 |
| Agent’s Statement of Resignation | $0.00 |
| Designation of Registered Agent and/or Registered Office | $5.00 |
| Amendment of Articles of Organization | $50.00 |
| Restated Articles of Organization without Amendment of Articles | $10.00 |
| Restated Articles of Organization with Amendment of Articles | $50.00 |
| Articles of Merger | $50.00 |
| Articles of Dissolution | $30.00 |
| Certificate of Administrative Dissolution | $0.00 |
| Application for reinstatement following administrative dissolution | $100.00 |
| Certificate of Reinstatement | $0.00 |
| Certificate of Judicial Dissolution | $0.00 |
| Application for Certificate of Authority | $250.00 |
| Application for Amended Certificate of Authority | $50.00 |
| Application for Certificate of Withdrawal | $10.00 |
| Certificate of Revocation of Authority to Transact Business | $0.00 |
| Articles of Correction | $10.00 |
| Certificate of Existence or Certificate of Authorization | $15.00 |
| Annual Report | $200.00 |
| Any other document required or permitted to be filed by Chapter 57D | $10.00 |
| Expedited filing (24-hour) | $100.00 |
| Expedited filing (same-day) | $200.00 |
| Online filing fee (card / bank transfer) | $3.00 / $2.00 |
Conclusion
Many small and micro businesses in North Carolina choose to operate as LLCs. These business owners find the North Carolina LLC costs affordable and worth paying for the advantages that come with having an LLC.
The information on this page may seem like a lot to absorb all at once. But take your time, and approach the process of forming an LLC step by step, and you’ll get there.
Even better, an LLC formation service like the one we offer makes the whole process less stressful, easier, and more pleasant (and dare we say more fun). We do a lot of these, so we know all the details that need attention. We’ll guide you through the process every step of the way.
You may even be able to write off the cost of our service on your taxes. That’s one of the many awesome perks of being a business owner.
Less stress and more write-offs. We can get behind that!
FAQ
The state filing fee to start an LLC in North Carolina is $125 for your Articles of Organization, plus a $3 online card fee ($128 total). Additional optional expenses like reserving a name or hiring a registered agent may increase the total startup cost.
Yes. Most LLCs in North Carolina must file an annual report by April 15 each year. The fee is $200, plus a $3 card fee online ($2 by bank transfer). Certain LLCs may also owe a franchise tax, depending on how they’re taxed federally.
You are required to designate a registered agent, but you can be your own. If you choose to hire a service, it typically costs $50–$300 per year. Tailor Brands’ registered agent service is $199 per year.
Filing a DBA in North Carolina costs $26. You must submit an Assumed Business Name Certificate to the Register of Deeds in a county where you do business after confirming name availability in the state’s database.
Yes, most LLC formation costs can be deducted as business startup costs on your federal taxes, including filing fees, registered agent fees, DBA costs, and attorney or operating agreement expenses. Consult a tax professional for full eligibility.