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How Much Does an LLC Cost in Alabama?
An LLC in Alabama costs $250 in Year 1: a $200 state filing fee plus $50 in recurring state fees ($50 / year) for the first year. After that it costs $50 per year, for a 5-year state total of $450. That makes Alabama the 19th most expensive state to form an LLC — the national average Year 1 cost is $220 and the median is $160.
Alabama LLC Fee Breakdown
| Fee | Cost |
| State filing fee (one-time) | $200 |
| Recurring state fees — $50 / year | $50 / yr |
| Year 1 total (filing fee + first year) | $250 |
| 5-year total (filing fee + 5 × annual) | $450 |
How Alabama Compares to Other States
- Rank: Alabama is the 19th most expensive state to form an LLC — #33 of 51 jurisdictions by 5-year state cost ($450).
- Year 1 vs the nation: $250 in Year 1 — $30 more than the national average of $220 (median $160).
- 5-year vs the nation: $450 over five years, against a national average of $586 and a median of $350.
- Recurring fee: $50 / year ($50/yr) — no separate franchise tax on top.
- Cheapest in the US: Arizona at $50 over 5 years. Most expensive: California at $4,120.
Alabama LLC Annual Fees & Franchise Tax
Alabama charges $50 per year in recurring state fees ($50 / year). Over five years that is $250 in recurring fees alone — $450 including the one-time filing fee.
No. Alabama does not charge LLCs a separate franchise tax. The recurring state cost is an annual filing or report fee of $50 per year ($50 / year), which is what the Year 1 and 5-year totals on this page are built from.
How to Form an LLC in Alabama (Step by Step)
- Choose a name. Pick a distinguishable name that includes "LLC" and check it is available on the Alabama Secretary of State website before you file.
- Appoint a registered agent. Name a person or service with a physical street address in Alabama who can receive legal mail during business hours — be your own for free, or hire one (see our registered agent guide).
- File your formation document. File the Articles of Organization (called a Certificate of Formation in some states) with the Alabama Secretary of State and pay the $200 filing fee.
- Create an operating agreement. Not filed with the state, but it records who owns what and how the LLC is run — banks and partners will ask for it.
- Get an EIN. Apply free on the IRS website in about 10 minutes — see our EIN guide. You need it to hire, pay taxes, and open a business account.
- Open a business bank account and stay compliant. Keep business money separate (see our business bank account guide), then keep up with Alabama's recurring fees — $50 / year — so the LLC stays in good standing (see our annual reports guide).
Good to Know About Alabama LLC Costs
Alabama charges an annual Business Privilege Tax — the minimum is $50, though it scales with your business assets, so asset-heavy LLCs can owe more.
File on the official Alabama Secretary of State site →
Fees verified against official state sources — last checked October 26, 2026.
Alabama LLC Cost FAQs
How much does it cost to start an LLC in Alabama?
The state filing fee in Alabama is $200. Adding the first year of recurring state fees ($50 / year) brings the Year 1 state cost to $250. Optional extras — a registered agent service, an operating agreement template, or a formation service — cost extra, but the state itself charges $250 in Year 1.
How much does an LLC in Alabama cost every year?
Alabama charges $50 per year in recurring state fees ($50 / year). Over five years that is $250 in recurring fees alone — $450 including the one-time filing fee.
Does Alabama charge LLCs a franchise tax?
No. Alabama does not charge LLCs a separate franchise tax. The recurring state cost is an annual filing or report fee of $50 per year ($50 / year), which is what the Year 1 and 5-year totals on this page are built from.
Do I need a registered agent for an LLC in Alabama?
Yes. Every LLC in Alabama must name a registered agent with a physical street address in the state who can receive legal and official mail during business hours. You can be your own agent if you live in Alabama and are reliably available, or hire a service — typically around $125 per year — to keep your own address off the public record.
What is the cheapest way to form an LLC in Alabama?
File it yourself on the official Alabama Secretary of State website, linked on this page. Filing direct costs just the $200 state filing fee (plus the $50 / year recurring fee) and skips formation-service markups. Use the free LLC cost calculator on this site first so you know your exact Year 1 and 5-year totals before you file.