How Much Does an LLC Cost in Mississippi (Formation Fees)
Forming a Mississippi LLC is a good business move, and one of the first steps of the formation process is planning your budget.
As a Mergers and Acquisitions specialist and Master’s Degree holder in tax law, I assisted businesses and individuals in forming LLCs and creating new joint organizations.
Together with our team of LLC experts and legal advisors, we researched and compiled the fees and regulations for Mississippi LLCs.
When planning to start an LLC, consider employing a professional Mississippi LLC service to help avoid errors that could prolong the LLC formation process.
Quick Summary
- An LLC in Mississippi costs $50 for filing the Certificate of Formation.
- Once the business has been approved and registered, there are additional expenses that should be covered, including licenses, permits, and other business documents.
- According to the Mississippi Department of Revenue, obtaining a sales tax permit, which is free, enables the collection of a 7% sales tax.
- When I started an LLC in Mississippi, the state offered online filing only but all the forms you’ll need to register your LLC are found in the Secretary of State’s website.
Cost to Start an LLC in Mississippi
Before an LLC is allowed to legally operate in the state, there are mandatory fees and optional expenses that have to be shouldered by the company.
1. LLC Formation Filing Fee ($50 - Mandatory)
To officially establish your LLC in Mississippi, you must pay $50 (plus a $4 credit card transaction fee) to file your LLC Certificate of Formation. This fee is paid only once, so you won't have to worry about annual fees [1]. According to the Mississippi Secretary of State, this streamlined fee structure has led to a significant increase in new LLC registrations, with over 20,000 LLCs formed in the state last year alone, demonstrating Mississippi's growing environment for new businesses.
When I helped a client form an LLC in the state, I was able to file the application using the online Business Services portal since the state doesn’t offer any other method of filing.
Expedited service is not available since online applications are processed within 24 hours.
Read more on how long does it take to start an LLC in Mississippi.
2. Registered Agent Fee ($80-$300 – Optional)
Selecting a Registered Agent is necessary for your Mississippi LLC. It can be an individual or a corporate entity with a Mississippi address that has been permitted to receive legal documents.
It's best to delegate these processes to a registered agent service if you think that legal correspondence could be too much to handle.
Professional registered agent service in Mississippi can cost you between $80-$300.
3. Name Reservation Fee ($25 - Optional)
You can pay $25 to file a Name Reservation form, which reserves your business name for 180 days, if you want to secure your business name before forming your Mississippi LLC.
Before reserving a business name, I remind clients to check if the name is available and if it complies with state regulations.
"While optional, reserving your business name ensures its availability upon filing your Certificate of Formation."
- Jon Morgan, CEO, Co-Founder & Editor-in-Chief of Venture Smarter
Expenses Following the Approval of Your LLC
Once the limited liability company has been approved and registered, the company has to spend on licensing fees, taxes, and business related documentation.
1. Professional Licensing Fees (Depending on the Profession - Mandatory)
You will require a professional license if your company operates in a sector subject to governmental regulation, such as landscape architecture or body piercing.
The amount you must pay will vary depending on the license type. For instance, my clients in the art and cosmetics industry were charged $100 for an art therapist license and $55 for a cosmetologist license.
2. Local License Fees (Depending on the Line of Business - Mandatory)
Specific municipalities in Mississippi issue a local business license (sometimes called a privilege license).
The cost of a local permit varies. For instance, a privilege license is required for all businesses in Jackson County, and the fee is based on the kind of business, the volume of inventory, and the staff size.
Construction, city planning permits, and licensing for specific industries, like amusement parks or the distribution of alcohol, are some more examples of local licenses.
3. Sales and Use Tax Permit (Mandatory)
A sales and use tax permit is required for all businesses that sell goods in Mississippi, and you must file for one online at the Mississippi Taxpayer Access Point (TAP) website [2].
Registration is free of charge. In Mississippi, this permit allows you to collect 7% sales tax, according to the Mississippi Department of Revenue [3].
Read our article and learn how to file LLC taxes in Mississippi.
4. Operating Agreement (Optional, but Recommended)
After forming your Mississippi LLC, we recommend you draft your operating agreement. Your LLC's regulations and organizational framework are in your operating agreement.
Most LLC formation services charge $100 to $200 for an Operating Agreement.
4. DBA Name ($25 - Optional)
In Mississippi, a fictitious business name (DBA) costs $25. I had to submit a Certificate of Assumed Name before I was able to obtain a DBA.
Registration for fictitious business names must be done online. You should first check the Mississippi Business Database to see if your DBA name is available.
5. Certificate Of Good Standing ($25 - Optional)
Mississippi Certificate of Good Standing (also known as Certificate of existence) applications must be submitted online for a $25 fee.
It's a state-issued report that attests to the fact that your company is operating legally in Mississippi.
A Certificate of Good Standing is often required when registering to run a business in another state or opening a business bank account.
6. Employer Identification Number ($0 - Optional, but Recommended)
The Internal Revenue Service offers EINs for no cost ($0). However, depending on the business, the price might be between $10 and $50 if you employ a professional to apply for it.
When clients ask the importance of an EIN, I tell them that obtaining one is necessary for opening a business bank account, hiring staffs, and acquiring loans.
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FAQs
Is There A Penalty For Paying My Taxes Late In Mississippi?
There is a penalty for paying your taxes late in Mississippi. You will be charged 10% of the tax due.
Who Gets the Filing Fees for My Mississippi Business Registration?
The Secretary of State of Mississippi gets the filing fees for your business registration.
References:
- https://corp.sos.ms.gov/corp/portal/c/page/login/portal.aspx
- https://tap.dor.ms.gov/WebFiles/Help/TAP/index.html#returnsandpayments
- https://www.dor.ms.gov/business/sales-tax-frequently-asked-questions#
