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Perhaps you are hoping to form an LLC in NC. People assume that starting 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 North Carolina.
North Carolina LLC Cost of Filing
Here are the costs involved in forming an LLC in North Carolina.
Cost of Filing Formation Certificates
The North Carolina 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 North Carolina Secretary of State.
North Carolina Domestic LLC
- Online Filing costs $125.
- Annual Report filing costs $200
- Name Reservation fee costs $30
- By Mail: Fill out the application form, and send it to NC Secretary of State Business Registration, P.O. Box 29622, Raleigh, North Carolina 27626-0622. Costs $125.
North Carolina Foreign LLC
- Online Filing costs $250.
- Annual Report filing costs $200
- Name Reservation fee costs $20
- By Mail: Fill out the application form, and send it to NC Secretary of State Business Registration, P.O. Box 29622, Raleigh, North Carolina 27626-0622. Costs $250.
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.
North Carolina LLC Formation Service or Registered Agent Fee
You need a registered agent to form an LLC in North Carolina, 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.
LLC Service | Our Rating & Pricing | Top Features | Learn More |
#1 TOP PICK  | $0 + State Fees |
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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 North Carolina Department of Revenue for regulatory boards or agencies requiring licensing.
Taxes payable to North Carolina Department of Revenue
An LLC in North Carolina has to pay several State as well as Federal Taxes at the stage of formation & during its operation. Read this article to know more about these taxes. The North Carolina State Department of Revenue charges several taxes on an LLC. The two main State Taxes are:
State Income Tax
An LLC owner has to pay state tax on any amount he draws via his LLC. The earnings are taxed through the personal tax return. The standard income tax rate in North Carolina is 5.25%. One can apply for all the standard allowances and deductions.
State Sales & Use Tax
Every LLC which is a service provider or is a seller of tangible goods is bound to the sales & use tax in North Carolina. The LLC has to collect taxes & then pay those to the North Carolina Department of Revenue. The Sales & Use Tax is different in different regions, counties, & cities.
The current state sales & use tax rate on LLC in North Carolina is 4.75%
Federal Self-Employment Tax
As the name suggests, Federal Self-Employment Tax is paid by all the LLC Business members or managers. This kind of tax applies to all the earnings a member withdraws from the business.
The Federal self-employment tax rate in North Carolina is 15.3 percent.
Federal Income Tax
The Federal Income Tax is calculated on the basis of the earnings, the income tax bracket your LLC falls, the deductions, & the manner/ mode of filing.
Federal Income Tax is levied on all the profits your LLC makes minus the deductions & allowances such as Healthcare or Retirement Plans.
Employee & Employer Taxes
If you have several employees who draw monthly salaries, there will be some added Employee-Employer taxes. These tax implications vary, depending on various factors, e.g., the amount, number of employees, etc.
Cost Comparison Between States
North Carolina is surrounded by many states, namely Virginia, South Carolina, Georgia, Tennessee, etc. Each of these states has a different rate of taxes levied on LLCs. Let us take a look at this comparative chart.
| States | Filing Fee | Annual/Biennial Fee | Sales Tax |
| North Carolina | $125 | $200 | 4.75% |
| Virginia | $104 | $50 | 5.3% |
| South Carolina | $110 | $10 | 6% |
| Georgia | $100 | $25 | 4% |
| Tennessee | $520 | $500 | 7% |
Based on the kind of industry you LLC operated in, your LLC will be liable to some other taxes & duties. For Example, if your LLC is in the sector of import & export, you have to pay the import-export duty.
You should consult with a professional to verify the tax rates or business costs of registering an LLC in North Carolina.
Other Costs
- North Carolina Name Reservation: $10 for online fillings or by mail
- Doing Business As (DBA): $26 for online filling or if filing by mail
- Certified Document Copies: $10 per document.
- Certified of Good Standing: $15
- 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 North Carolina LLC: $30
F.A.Qs
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.
How Much Does It Cost to Maintain an LLC in North Carolina
To maintain an LLC in North Carolina you will need to pay an annual fee of $200 along with state sales & use tax at 4.75%, state income tax at 5.25% and federal taxes.
One of the initial costs of setting up an LLC in North Carolina is filing the necessary paperwork with the state. The Articles of Organization must be filed with the North Carolina Secretary of State, and there is a fee for this process. Additionally, business owners may choose to work with a legal or financial professional to assist with the formation of their LLC, which can incur additional costs.
Once the LLC is established, there are ongoing costs to consider. In North Carolina, LLCs are required to file an annual report with the Secretary of State and pay a filing fee. Failure to do so can result in penalties and could lead to the LLC being administratively dissolved. Additionally, LLCs are subject to an annual state franchise tax, which is based on the net worth of the business.
In addition to these state-mandated costs, there are other expenses associated with running an LLC in North Carolina. Business owners may choose to secure business licenses and permits, which can vary in cost depending on the nature of the business and its location. Legal and financial services may also be necessary on an ongoing basis to ensure compliance with state regulations and to navigate any legal issues that may arise.
Business owners should also consider the potential costs of liability insurance for their LLC. While the limited liability protection of an LLC can shield personal assets from business debts and legal claims, insurance coverage can provide an added layer of protection and peace of mind. The cost of insurance coverage can vary depending on the nature of the business and the level of coverage required.
Overall, maintaining an LLC in North Carolina involves various costs that business owners should carefully consider. The financial obligations associated with a business entity can impact the overall profitability and sustainability of the venture. By understanding the costs involved and planning accordingly, business owners can make informed decisions about whether an LLC is the right choice for their business goals.
In conclusion, the costs of maintaining an LLC in North Carolina should not be underestimated. Business owners should be prepared for the initial formation costs, annual filing fees, state franchise tax, and other ongoing expenses associated with running an LLC in the state. By understanding these costs and planning accordingly, business owners can set their LLC up for success and ensure compliance with state regulations.
In Conclusion
The cost of North Carolina 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.