When forming a business, calculating possible expenses is a good practice to prevent unexpected budget cuts. Although low-cost states like Arkansas give you enticing financial leverages, no entity is exempted with mandatory charges. Lucky for you, our business experts will discuss all Arkansas LLC fees so that you can operate legally without any hassles.
Formation Costs for an Arkansas LLC
Business Name Reservation
Typically, filing your articles of organization to the Secretary of State is the fastest way to reserve your chosen LLC name. However, if you can’t go on to this procedure due to prior engagements, you have the option to pay a reservation fee amounting to $22.50 for an online application or $25 hard copy filing.
This reservation gives you 120 days of exclusive rights to the chosen LLC name. Although it’s great if you can’t face the registration legwork yet, our trade enthusiasts advise you to proceed with filing formation documents as soon as you can to avoid additional charges.
Articles of Organization
One of the essential submissions you have to accomplish to make your LLC legal is the filing of your articles of organization. Sure, there are many Arkansas LLC fees you need to settle [1], but this document is by far the most costly expense you’ll have to pay when forming your business entity.
This formation document must be submitted to the SOS and costs around $45 for the online filings and $50 for paper submissions.
Operating Agreement
You may not be aware, but operating agreements aren’t part of the mandatory formation documents an entity must submit to form an LLC. However, despite its non-inclusion, there are obvious perks of crafting an operating agreement for your business. You can create one yourself without any fees or hire a legal professional to avoid legal lapses.
EIN Registration
Acquiring a Federal Tax ID Number or Employer Identification Number (EIN) is another step any business entity cannot ignore. This nine-digit code acts as a social security number for your LLC, so we highly recommend obtaining it as soon as you can.
Obtaining EIN is extremely essential as it’s often required when filing taxes, hiring employees and opening business bank accounts. You can apply for the number at the IRS free of charge.
Registered Agent
It’s not a secret that great registered agent providers play a crucial part in maintaining your good standing within the state. As the role is solely responsible for receiving critical notices and demands, it’s no surprise that there are set standards to qualify in this function.
Although you have the freedom to be your company’s registered agent, our business specialists would like to remind you that this entails demanding obligations. So if you’re planning to focus on generating income, hiring a registered agent is an ideal option for you.
These providers ensure full compliance and get the job done efficiently with monthly or annual charges ranging from $0 to $300.
(For online assistance, you can check the best online incorporation services listed here)
Business License/s
Not all business types need licenses, but depending on the nature of your operation, the state requirements may vary from state, federal, county, and municipal governments. According to state law, businesses offering professional services will need to pass specific licensing exams before operating legally.
Foreign LLC Registration
For existing LLCs expanding in Arkansas, you will need to submit a Certificate of Registration to the state office to be recognized as a foreign entity. This procedure comes along with an online filing fee of $270 or $300 for hard-copy submissions.
LLC Formation Services (Optional)
Admit it or not, the registration process can be intimidating. While it’s good to handle the legwork personally, there’s no shame in seeking professional LLC formation services to do the filings on your behalf. These providers will form your business swiftly and charge $0 – $300.
Arkansas Annual LLC State Fees
Annual Franchise Tax Report
Aside from formation fees, you also must pay recurring expenses amounting to $150 when you file for Annual Franchise Tax Report every May 1. This submission allows the government to update your records, and failure to accomplish this could result in penalties.
Overall Costs
Excluding the costs of additional services and business-specific requirements like taxes and licenses, the overall expense of forming and maintaining an LLC costs more or less $200 for domestic LLCs and $450 for foreign entities.
FAQ
How much does an LLC cost in Arkansas?
An LLC in Arkansas costs around $200, inclusive of the filing fee for your articles of organization and submission of your company’s annual franchise tax reports every May 1. This estimate costs exclude taxes and licenses, as the range of those expenses depends on the nature of your business.
Conclusion
As you have already noticed, Arkansas LLC fees are minimal compared to other states out there. However, it doesn’t mean you can be complacent about it. While it’s great to look for ways to lessen expenses, we’d like to remind you that complying with requirements is still the best method to maintain your perks.
