How Much Does an LLC Cost in Maine (Formation Fees Revealed)
Starting an LLC in Maine is a smart move for your business if you want personal asset protection and taxation benefits.
However there are some costs associated with doing so, and it's essential to be aware of these before beginning the process.
As an expert in Mergers and Acquisitions and a Master’s Degree holder in tax law, I assisted several entrepreneurs in LLC formation and with creating joint organizations.
We consulted our team of licensed LLC experts in the state and reviewed the Maine Secretary of State's website for accurate documents and cost details.
However, if you want to get your Maine LLC formed quickly and avoid costly mistakes, hiring a professional Maine LLC service might be your best option.
Quick Summary
- An LLC in Maine costs $178 to file the Articles of Organization online and $175 by mail.
- Upon approval of the business, additional costs you may have to shoulder include licenses and permits, registered agent service, annual reports, taxes, and other documentation.
- Maine's income tax rates vary, with 5.8% on incomes under $23,000 and 7.15% over $54,450, according to the Maine Department of Revenue.
- In my experience, an LLC in Maine is easy to register and maintain in comparison to other states.
Cost to Start an LLC in Maine
Before a business can legally operate in the state, there are mandatory fees and expenses you have to shoulder.
1. LLC Formation Filing Fee ($175/Mail - $178/Online - Mandatory)
As a business owner, your Maine LLC will be formally constituted whenever you submit the required paperwork to the Secretary of State.
During the registration process, you must pay the processing fee of $175 ($178 online) and attach your Certificate of Formation together with a Customer Contact Cover Letter to the SOS department [1].
Note the standard processing by the Maine Secretary of State is 25 to 30 business days.
However, I availed of the expedited service to streamline the process. Same-day processing costs $100 more, and 24-hour processing costs $50.
2. Registered Agent Fee ($80-$300 – Optional)
The state allows appointing yourself as a registered agent, but you must be present in the same physical place every working day of the year.
If this does not work for you, consider hiring a registered agent service, which costs $80 to $300 annually.
"For selecting a registered agent, you have several choices: acting as your own, nominating a business partner or friend, or engaging a professional service."
- Jon Morgan, CEO, Co-Founder & Editor-in-Chief of Venture Smarter
3. Name Reservation Fee ($20 - Optional)
You'll have to pay $20 for this service, and no other company may use your safeguarded name for 120 days from the start of the reservation.
Before filing a name reservation application, I ensure that my clients’ desired LLC names are available and follow state guidelines.
Expenses Following the Approval of Your LLC
Apart from the initial registration fees, you may incur other filing costs when starting a Maine LLC. These costs include the following.
1. Business Licenses (Depending on the Line of Business - Mandatory)
You might need extra business licenses based on your LLC's location in Maine and your sector. For instance, you could require a City Business Permit if you run an LLC in Portland [2].
According to the Maine Department of Economic & Community Development, over 90% of businesses in certain sectors, such as food services and lodging, are required to secure specific local permits, underscoring the importance of understanding local regulations.
Depending on your location and profession, these additional business licenses for an LLC may cost more or less, although they are often not expensive.
A client of mine was issued a certification for their lodging business and had to pay a $205 license fee.
2. Annual Report Fee ($85 - Mandatory)
A Maine annual report maintains the legitimacy and legal compliance of your LLC so that it may continue to operate legally.
The annual fee for the LLC Annual Report is $85, and you must pay this fee every year as long as your LLC is operational.
3. Taxes (Depending on Income Bracket - Mandatory)
Maine LLCs are pass-through structures for tax purposes. As a result, you won't have to pay company taxes.
Instead, the LLC's earnings "flow through" to its owners, who are then in charge of declaring the payments on their tax reports and incurring the 15.3% federal self-employment payroll tax.
Moreover, the Maine income tax on business revenue is due from shareholders and workers. Depending on the sum of income declared, state rates for income taxes change.
A 5.8% tax rate is applied to an income threshold under $23,000, while a 7.15% tax rate is applied to business revenue exceeding $54,450, according to the Maine Department of Revenue [3].
4. Operating Agreement ($100 - $200 - Mandatory)
All LLC owners are required by the Maine Secretary of State to draft and file an operating agreement.
You can draft the operating agreement for yourself at zero cost or hire an online LLC formation service to create it for $100-$200.
For clients with budget to spare, I advise them to employ a legal professional to ensure the document’s validity.
5. DBA Name Filing ($125 - Optional)
You can register a DBA with the Maine SOS if your LLC plans to conduct business using a name other than the one stated on your Certificate of Incorporation.
The Secretary of State will receive your Declaration of Intention to Transact Business Under an Assumed or Fictitious Business Name. That will set you back $125.
6. Certified Document Copies ($5 + $2 per additional page - Optional but Recommended)
Throughout the course of running your Maine business, you may require certified copies of vital records, including your Maine Annual reports or Certificate of Incorporation. These certified copies are important for many reasons.
For example, a foreign state needs an accredited document copy if, as your company expands, you want to move your LLC there.
I had to pay $5 + $2 for each page to obtain copies that are state-certified.
7. Certificate Of Existence ($30 - Optional)
When clients ask the importance of obtaining a Certificate of Existence, I tell them that the document demonstrates that your LLC is legitimately registered and current with the agency.
It is necessary when pursuing potential investors and acquiring loans.
It costs a filing fee of $30 to apply for a Maine Certificate of Existence. And this document is issued to LLCs that are compliant with state regulations.
8. Employer Identification Number ($0 - Optional but Recommended)
Send the IRS the Employer Identification Number Application (Form SS-4) to obtain an EIN. This submission is free if you do it by yourself, and you can complete it online, by email, or by phone.
However, if you hire a professional Maine LLC formation service, EIN registration can cost you a filing fee of $50-$100.
FAQs
Is There A Penalty For Paying My Taxes Late In Maine?
There is a penalty for paying your taxes late in Maine. You will be charged $25 or 10% of the amount due, whichever is greater.
What Payment Methods Can I Use To Pay Maine's State Fees For Filing My LLC?
The payment methods you can use to pay Maine’s state fees for filing your LLC include MasterCard, Visa, Discover, or a subscriber’s account.
How Much Do I Have To Pay To Reinstate My Maine LLC?
You have to pay $85 to reinstate your Maine LLC. This is applicable to administratively dissolved entities.
References:
- https://www.maine.gov/sos/cec/corp/llc.html
- https://www.maine.gov/portal/business/licensing.html
- https://www.maine.gov/revenue/faq/corporate-income-tax
