The costs of starting an LLC in the US – Hidden fees explained

Starting a business in the United States is a dream for many entrepreneurs around the world. With a strong legal system, access to global markets, and trusted payment infrastructure, forming a US LLC can be a smart move, even if you don’t live in the US.

But before you jump into an “easy $0 LLC formation” offer, you should know what you’re really signing up for. Many formation services advertise low prices but include hidden fees that sneak up on you later.

In this post, we’ll walk you through all the real costs of forming and maintaining a US LLC, especially if you’re a non-resident or an American living abroad. 

Who is this for?

• Non-US entrepreneurs setting up a US-based business
• Freelancers and digital nomads who want to bill US clients
• US citizens living abroad who need a US-based business entity

If any of these sound like you, this guide will help you avoid surprises and make smarter decisions.

The basic costs of forming an LLC in the US

Let’s start with the obvious costs.

1. State filing fee

Every US state charges a fee to file your LLC. This fee ranges from $40 to $500, depending on the state you choose.

Tip: Wyoming and Delaware are popular for their low fees and business-friendly laws.

2. Registered agent service

All states require a Registered Agent with a US address to receive legal mail.

If you’re not in the US, you’ll need to hire a service. Expect to pay around $80–$200/year.

3. EIN (Employer Identification Number)

This is like a tax ID number for your LLC, required to open a bank account or accept payments.

• Cost from IRS: $0
• Cost from formation companies: $50–$200

You can apply for an EIN yourself by phone or fax, but language barriers and unfamiliar IRS procedures can make the process more difficult than it seems. Remember, no one can fast-track the process. Issuance without an SSN typically takes 2–6 weeks and depends entirely on the IRS.

Hidden or “surprise” LLC fees to watch out for

Here’s where things get tricky. Many people only realize these fees exist after they’ve started.

1. Annual franchise taxes & reports

Some states charge annual fees to keep your LLC active.

• Delaware: $300 annual franchise tax
• California: $800 minimum annual tax
• Wyoming: $60 annual report
  

These fees are recurring – and mandatory!

2. Virtual address or mailbox services

You may need a US mailing address to receive business mail or open a US bank account. Fintech platforms like Mercury and Wise may ask for a utility bill or bank statement from your home country as proof of address.

• Cost: $120–$300/year
• Some providers charge extra for scanning or forwarding mail

3. Banking setup fees

Some companies charge you to open a US business bank account or connect you to partners like Mercury or Relay.

• Some charge $100–$300+ just for access
• Others include it free with higher-tier packages

4. Compliance upsells

WIth some providers, you may also see fees for:

• Operating agreement templates
• Meeting minutes templates
• Certificate of good standing
• Compliance alerts

These can cost $50–$250/year or more depending on what’s bundled.

5. ITIN Application (if applicable)

If you’re a non-US resident and want to pay taxes or get access to personal banking, you might need an ITIN (Individual Taxpayer Identification Number).

• Optional for many, but still charged
• Cost: $150–$400

What do you really get from business formation services?

Let’s break it down. Many well-known providers like Doola and Firstbase offer similar packages, but they differ in the details.

Based on information available as of April 25, 2025.

Insight: What starts as a “$199 deal” can quickly turn into $700+ once renewals and necessary “extras” are added.

Many service packages also include extras like partner rewards, company seals, website builder trials, and business plan templates. For most entrepreneurs, these features offer little real value.

This brings us to the next important consideration.

Essential services vs. marketing upsells in LLC formation

Let’s clarify what most of the people need when opening US LLC from abroad versus what’s simply being sold to you:

Essential services

These are the things you absolutely need to form your US LLC:

• LLC filing – The fundamental service to legally create your entity
• Registered agent – Legally required in all states
• EIN number – Required for banking, taxes, and business operations
• Operating agreement – Provides legal protection and operational structure
• US address – Essential if you’re a non-resident
• Banking setup – Valuable for non-residents, but some services charge unnecessarily

Ongoing maintenance requirements

To keep your LLC open and in good standing, you need to have the following:

• State annual reports – Required filings with associated fees (varies by state)
• Registered agent renewal – Continuous representation required by law
• Tax filing compliance – Federal and state tax returns as required

Common upsells with limited value

Things that are not required to open or maintain your LLC:

• “Premium” EIN filing – The basic service is identical to what you get free from the IRS
• Expedited filing markups – Often charging 2-4x the actual state expedited fee
• Corporate kits & seals – Decorative items with no legal significance
• Deluxe mail scanning tiers – Basic scanning is usually sufficient
• Website/domain bundles – Available elsewhere for significantly less
• Generic business license research – Rarely provides actionable, specific guidance
• Basic “compliance calendars” –  Simple automated reminders marketed as compliance expertise

This doesn’t mean that providers offering these upsells can’t successfully help form your LLC. The key is transparency. Make sure they clearly explain what you’re getting, why you need it, and what it will actually cost.

The best providers will help you understand which services are actually necessary for your specific situation rather than pressuring you to purchase everything they offer.

Why a complete provider matters: Beyond just LLC formation

The real difference between LLC formation services often lies not in their packages, but in their ability to support your business long-term, especially with tax and compliance needs.

The most valuable business formation partners will offer you a genuine end-to-end solution:

• Seamless handoff between formation and tax teams
• Consistent strategy from entity selection through annual filings
• Proactive compliance monitoring for state and federal requirements
• Direct access to experienced tax professionals familiar with your situation
• Full tax expertise beyond basic forms (5472/1040) for complex situations
• Cost efficiency through bundled services that eliminate duplicate work

Experienced, full-service providers can save you time, reduce risk, often lower your costs compared to piecing together multiple specialized services.

They’ll remain available year-round for questions. You won’t be left with generic templates after the service is complete, or have your tax work outsourced to generalist preparers.

On the other hand, here’s what can happen when your formation provider and tax advisor are separate entities:

How to avoid overpaying for your LLC

Before you trust someone to form your LLC, pay attention to this:

• Choose the right state (Wyoming or Delaware are often best)
• Avoid services that upsell EIN or annual renewals
• Use a formation partner that shows every fee upfront
• Choose partners with tax and compliance know-how for long-term success
• Compare before you commit – not all LLC services are equal!

Ready to start your US LLC?

Starting an LLC in the US as a foreigner doesn’t have to be expensive or confusing. You can set up a US LLC and file all tax forms and other required reports yourself. But before you begin, make sure you understand the full picture. 

If you decide to work with a service provider, avoid flashy ads that promise a $0 LLC only to upsell you every step of the way. 

Choose a partner who prioritizes clarity, compliance, and your long-term success if you want to save time, avoid costly mistakes, and have expert guidance throughout your business journey.

We ‘re here to help make that journey smoother.

We make it simple, transparent, and affordable. No hidden fees. No surprises. Just everything you need, in one place.