Perhaps you are hoping to form an LLC in Iowa. People assume how to start an LLC is difficult and costly. However, it’s generally not difficult, and the cost would vary across states. We have all the info you need to know about the cost of forming an LLC, particularly the LLC cost in Iowa.
On this page, you’ll learn about the following:
Iowa LLC Cost of Filing
Here are the costs involved in forming an LLC in Iowa.
Cost of Filing Formation Certificates
The Iowa Certificate of Formation is responsible for the majority of the cost, which could also vary depending on whether you’re forming a domestic LLC or a foreign LLC. Still, you can file both at the Iowa Secretary of State.
Iowa Domestic LLC
- Online Filing Fee costs $50
- Biennial Report Fee costs $60
- Name Reservation fee costs $10
- By Mail: The State of Iowa does not have a standard document for Certificate of Organization to be filed by mail. You are required to create your own Certificate of Organization abiding by the specified requirements.
After creating your Certificate of Organization, you can mail the document to the following address: Lucas State Office Building, 321 E 12th St, Des Moines, IA 50319.
Visit the Official State website to learn more about Domestic LLC costs in Iowa.
Iowa Foreign LLC
- Online Application for Certificate of Authority costs $100.00
- By mail: Fill the Certificate of Authority form and submit the form to the following address: Secretary of State, Business Services Division, Lucas Building, 1st floor, Des Moines, IA 50319.
- Biennial Report costs $60.00
- Name reservation fee costs $10.00
Visit the official iowa.gov website to learn more about the costs of filing a foreign LLC in Iowa.
Note that filing online is ideal, not only because you need to go to the Secretary of State office, but also it would be faster. You won’t have to wait in a queue in doing so.
Iowa LLC Formation Service or Registered Agent Fee
You need a registered agent to form an LLC in Iowa, hence, added costs for service fees. Here are three of the best LLC services on our list that will provide you with registered agents to ease your worries.
Business Permits and Licenses
The business licenses depend on your business’s activity and location and are renewed yearly. As such, the cost will vary. Check the Iowa Department of Revenue Business Permit Registration.
Iowa LLC Taxes to be Paid
Apart from the filing of the Annual Report, the Iowa LLCs are also subject to state tax filing obligations. Though the taxes vary from county to county.
Corporate Income tax
The Iowa Business Entities are subject to state income tax depending on the amount of income earned with certain deductions: 5.5% for $100,000 and below; 9.0% between $100,000 and $250,000;
and, 9.8% for over $250,000.
State Business Tax
Iowa imposes a corporate income tax at the maximum marginal rate of 12%, which constitutes the maximum among the States of the United States.
Iowa Withholding Tax
The withholding tax in Iowa on a nonwage income is made at the rate of 5%. Visit the Iowa Government Tax website to calculate your withholding.
Sales and Use Tax
The standard rate of sales tax is at the rate of 6% and the maximum local or county rate that applies additionally is 1.00%.
Cost comparison among States
Every state has different costs of filing for an LLC to their respective State Authorities. If you wish to gain a better understanding of the costs of opening an LLC in a different state in comparison to Iowa, read the table below:
|State||Filing Fee||Annual Fee/Biennial Fee||Sales Tax|
|Iowa LLC||$50||$60 (Biennial)||6%|
|Minnesota LLC||$135||$0 (Annual)||6.87%|
|Illinois LLC||$150||$75 (Annual)||6.25%|
|Missouri LLC||$50||$0 (Annual)||4.225%|
|South Dakota LLC||$150||$50 (Annual)||4.5%|
Iowa is the source producer of standard quality agricultural and manufactured products. Iowa has established a diversified economy and welcomes significant business opportunities with a strong workforce.
- Iowa Name Reservation: $10 for online filing and by mail
- Doing Business As (DBA): $5 if filing by mail
- Certified Document Copies: $5 plus copy charge per page
- Certificate of Good Standing: $5
- Business Domain Name and Website: depend on your preference, but domain name could be as low as $2.99/yr at NameCheap, and web hosting is at least $30/mo at Kinsta.
- Online workspace: at least $4.20/mo for GSuite.
- Business Insurance: would vary depending on insurance type–whether general liability insurance or professional liability insurance–and coverage.
- Dissolution of Iowa LLC: $5
How Much Does It Cost to Maintain an LLC in Iowa
To maintain an LLC in Iowa you will need to pay a biennial fee of $60 along with sales tax at 6%, corporate income tax, state business tax and federal taxes.
When starting a business, there are many factors an entrepreneur needs to consider, and costs are certainly one of the crucial aspects. In Iowa, forming a Limited Liability Company (LLC) has become a popular choice for business owners due to its flexibility and legal protections. However, it is important to understand the potential expenses associated with maintaining an LLC in the state. Let’s delve into the various cost considerations that Iowa-based LLCs should be aware of in order to make sound financial decisions.
One of the important costs to acknowledge is the necessary filing fees to establish an LLC in Iowa. While the amount may vary, potential business owners must factor in these expenses when planning their budget. It is recommended to consult official sources or seek professional advice to ensure accurate information regarding these fees.
Moreover, maintaining an LLC in Iowa also involves ongoing costs. These often include annual report fees and compliance expenses. Iowa, like many other states, requires LLCs to file an annual report to keep the business in good standing. This report typically contains basic company information and may also encompass any relevant changes that have occurred throughout the year. Business owners should be mindful of the due date of this report as late filings might result in penalties or even dissolution of the LLC.
Additionally, operational costs should be taken into account. While not solely exclusive to LLCs in Iowa, expenses related to day-to-day activities, employees’ salaries, office and equipment leases are all factors that contribute to a business’s monthly expenses. Understanding and planned budgeting for these costs is essential for the long-term success of an LLC.
Furthermore, legal fees can be an unforeseen but necessary expense in Iowa for an LLC. Whether it be contracts, permits, or registrations, seeking legal advice or representation can be crucial to prevent potentially larger issues down the road. While hiring an attorney may seem costly, it can provide significant peace of mind by ensuring legal compliance and helping to avoid legal pitfalls.
In today’s digital age, online presence and marketing have become indispensable for businesses across the board, including LLCs. Engaging in digital marketing efforts, building a website, and maintaining an active social media presence are part and parcel of establishing a successful brand. Online marketing expenses can vary depending on the scale and reach of the business, thus it becomes essential for an LLC in Iowa to allocate resources appropriately.
Lastly, let’s not overlook insurance costs. While not mandatory in the state, LLCs may opt to secure general liability insurance or other types of coverage depending on their industry. Acquiring insurance can protect the business against unexpected events, unfortunate accidents, and potential legal claims.
In conclusion, understanding the cost factors associated with maintaining an LLC in Iowa is vital for all aspiring entrepreneurs. Carefully considering the expenses involved in establishing and running a business allows for more effective budgeting and planning. By staying informed and seeking professional advice, entrepreneurs can make informed financial decisions for the long-term success of their LLCs.
It is possible to form an LLC without professional help, but forms still have associated costs, regardless of where your LLC is formed.
It is difficult to say whether forming an LLC is expensive. Nevertheless, the cost could be anywhere from $40 to $500. If you refuse to hire professionals, you’ll still have expenses like form fees to cover.
The need to separate personal money from business funds, thus necessitating the creation of a business bank account for your LLC.
The cost of Iowa is much lower compared to other forms of business. Apart from the state filing fees and annual taxes, you might bear the cost of the registered agent. Compare the price of professional LLC services and choose the most affordable one.