How Much Does an LLC Cost in Pennsylvania (Full Guide)
Establishing a business entity such as a limited liability company in Pennsylvania may appear costly. However, the process can be much more affordable than you realize.
With my expertise in Mergers and Acquisitions and a Master’s Degree in tax law, I'm here to provide you with an informed perspective on the expenses involved in creating an LLC in Pennsylvania.
Following extensive research, we have compiled a comprehensive list of initial and ongoing Pennsylvania LLC costs detailed below in this article.
Quick Summary
- An LLC in Pennsylvania costs $125 to file the Certificate of Organization.
- Once the LLC has been approved, you may need to cover the fees for a registered agent service, business licenses, decennial report, operating agreement, and other relevant business documents.
- According to the Pennsylvania Department of State, about 70% of business filings are submitted online, highlighting the efficiency and convenience of digital services.
- For clients working within a budget, I advise them to use the standard filing process and draft an operating agreement using an online template.
Cost to Start an LLC in Pennsylvania
Starting an LLC in Pennsylvania entails mandatory fees to cover the basic expenses.
1. LLC Formation Filing Fee ($125 - Mandatory)
The fee for filing the Certificate of Organization in Pennsylvania is just $125. After submitting this form to the Pennsylvania Department of State, your LLC will officially be recognized and established [1].
However, if you're a veteran or armed forces reservist running a small business, you may be eligible to waive this fee completely.
We advise that you submit your Docketing Statement alongside the Certificate.
You can file your documents by mail, in person, or online via the Pennsylvania Department of State's Business Filings Services portal [2].
According to the Pennsylvania Department of State, approximately 70% of business filings are now conducted online, reflecting the growing preference for digital services due to their convenience and faster processing times.
To avail of the expedited service, I learned that the state only offers this option for online and in-person applications. My application was approved for only $100 on the same day.
2. Registered Agent Service Fee ($80-$300 – Optional)
Pennsylvania's law mandates that each LLC must have an established registered office within the state's borders.
Employing a registered agent service in Pennsylvania costs $80 - $300 per year.
This person will be responsible for accepting and forwarding official documents, notices from the state, and other legal correspondence on behalf of your business and should be available regularly during business hours (15 Pa CS § 8825) [3].
According to the Pennsylvania Chamber of Business and Industry, approximately 85% of LLCs in the state comply with this requirement by maintaining a registered agent, underscoring the critical role these services play in ensuring legal compliance and operational continuity for businesses.
"Pennsylvania law mandates that entities furnish an official mailing address or registered office within the state capable of receiving service of lawsuits and other legal documents on behalf of the LLC. Ensure this address is a physical one as P.O. boxes are not permitted."
- Jon Morgan, CEO, Co-Founder & Editor-in-Chief of Venture Smarter
3. Name Reservation Fee ($70 - Optional)
To reserve a business name, you should file a name reservation form and pay the $70 fee to the Pennsylvania Department of State. Your preferred LLC name will not be made available to other companies for 120 days.
Before finalizing their application, I remind clients to check if their desired business name is available and comply with state guidelines.
Expenses Following the Approval of Your LLC
Once the LLC has been approved, there are additional expenses needed to operate the business.
1. Business License (Depending on the Line of Business - Mandatory)
Depending on your LLC's Pennsylvania location and work sector, you might need extra Business Licenses or Permits.
When a client wanted to operate a medical clinic, the state required professional licenses for the business to be legitimate.
For more information on specific licensing requirements for different industries, the Department of State's Professional Licensing Boards & Commission webpage is an excellent resource [4].
2. Decennial Report Fee ($70 - Mandatory)
It is necessary to file a Decennial Report and pay the Pennsylvania Department of State a fee of $70 every decade following the registration of your LLC [5].
3. LLC Operating Agreement Fee (Optional, but Recommended)
A Pennsylvania LLC Operating Agreement is a legally binding contract between the members of an LLC.
Drafting an operating agreement won't cost you a cent since the members of the LLC could come up with one. However, when we used an online LLC formation service, we paid $100.
You can avail of online templates for $100 to $200.
4. EIN ($0 - Optional, but Recommended)
An Employer Identification Number (EIN), or Federal Employer Identification Number (FEIN), is essential for filing taxes, launching an LLC business bank account, and onboarding staff members.
Save yourself some money and take advantage of the fact that you can obtain an EIN for your LLC directly from the Internal Revenue Service (IRS) - all free.
5. DBA Name ($70 - Optional)
Registering for a DBA (known as a "fictitious” name" in Pennsylvania) will cost you just $70.
To legally operate under a Doing Business As (DBA) name, a client was required to file the necessary paperwork with the Department of State and publish a notice in two newspapers in the county where the business is located.
The publication requirements are in Pennsylvania state law 54 Pa CS § 311(g).
6. Certified Copies Of Business Documents ($40 + $3 per page - Optional)
You can obtain certified copies of your business documents for only $40 plus an additional $3 per page.
I advise clients to acquire copies of their LLC documentation for record keeping and potential legal issues.
7. LLC Certificate Of Subsistence ($40 - Optional)
Domestic businesses must pay a $40 fee to receive their Subsistence Certificate, regardless of whether they submit their request online or via mail.
If you are looking to secure a loan from your bank or extend the reach of your business into another state, obtaining a Pennsylvania Certificate of Subsistence (also known as a Certificate of Good Standing) is an essential step.
Related Articles:
- Dissolving an LLC in Pennsylvania
- Looking up an LLC in Pennsylvania
- LLC Processing Period in Pennsylvania
FAQs
Do You Have To Pay For A Pennsylvania LLC Every Year?
You do not have to pay for a Pennsylvania LLC annually. Although there is no annual organization filing fee, remember the decennial report fee of $70 every ten years.
Are There Pennsylvania Business Taxes I Need To Pay?
There are Pennsylvania business taxes you need to pay. Depending on the business activity you're engaged in, you may be subject to various state and local taxes, such as personal income tax withholding and sales and use tax.
References:
- https://www.dos.pa.gov/BusinessCharities/Business/Resources/Pages/Fees-and-Payments.aspx
- https://file.dos.pa.gov/
- https://www.legis.state.pa.us/cfdocs/legis/LI/consCheck.cfm?txtType=HTM&ttl=15&div=0&chpt=88&sctn=25&subsctn=0
- https://www.dos.pa.gov/ProfessionalLicensing/BoardsCommissions/Pages/default.aspx
- https://www.dos.pa.gov/BusinessCharities/Business/RegistrationForms/Documents/RegForms/
