Registering a new limited liability corporation (LLC) in Florida comes with a number of requirements. Paperwork, business plans, and tax agreements are some of the more prominent up front LLC publication requirements, but there are also a number of costs. In addition to fees and taxes being paid up front, businesses must also pay some annual costs to keep their businesses legally operating. New business owners should be aware of these costs before they file their LLCs. Additionally, you should keep the recurring costs in mind as you operate their business. The following are five costs and annual filing fees that business owners can expect when they incorporate an LLC in Florida.
The Initial Incorporation Fees
The most basic cost of incorporating an LLC in Florida is the incorporation fees. After the paperwork is filed, the Florida Secretary of State requires a one time payment. After this, the LLC must designate someone as a registered agent, who will accept legal and tax documentation for the corporation. Business owners must pay a one time fee to the state when naming an agent. An optional but recommended step is to pay a nominal fee to get a certified copy of the company’s articles of organization. This ensures that you have backup for the original document since regular copies will not suffice if something happens to the original. At minimum, prospective new business owners should expect to pay over $100 in fees when incorporating an LLC.
Fictitious Business Name Registration Fee
While it is not strictly necessary, many businesses choose to do business under an official name and a “doing business as” (DBA) name. A legal name can be long and clunky as to not overlap with existing corporate names, while a DBA business name can be more marketable. Registering a DBA with the Florida Division of Corporations is done either online or by mail, and costs under a hundred dollars. After the initial filing, the DBA is valid for a period of five years, whereupon the name must be re-registered along with another fee. While optional, many business owners choose to register a DBA as it allows them more flexibility with naming their business.
The Cost Of A Registered Agent
There is a substantial annual cost associated with registered agents. A registered agent is a person who handles tax and legal documentation, official government correspondence, and any legal summons the business may have. Third party contractors who work on behalf of many LLCs can charge fees ranging from $50-500 annually. It is possible for a business to designate an employee or even the business owner as a registered agent. However, there is still an opportunity cost associated with the time it takes to handle these documents. Business owners must choose between spending their time to keep up with compliance standards, or spending their money to hire a service to do so for them.
Business Licensing Fees
In Florida, every type of business must apply for a business license, an Employer Identification Number (EIN), and register with the Department of Revenue. A license and an EIN must be obtained even if the LLC is a sole proprietorship or has no employees. The price of a business license in Florida is less than $100, though the fee can vary by business. Typically, these licenses are renewed annually, and the fee recurs at time of renewal. A lapsed business owner can face a number of fines, so maintaining a valid license should be a top priority.
Filing The Annual LLC Report
The Sunshine State requires all LLCs incorporated within the state to file a report each year to retain their active status. The report must be filed online at any time between January 1st and May 1st. The annual filing is accompanied by an additional yearly processing fee. Businesses that miss the May 1st deadline to file must pay late fees. Business owners should file their reports regularly to prevent any lapse in status or late fees.
Starting an LLC in Florida has a number of fees and costs associated with their creation and operation. Some fees, like the incorporation fee and the registered agent fee paid to the Secretary of State, are not. Other fees, like the DBA name and a certified copy of the articles of incorporation, are optional but recommended. The costs of services associated with keeping the LLC running can either be paid in the money spent on a third party or in time that the business owner invests. There are also recurring licensing fees that vary in price by business. Finally, avoiding late fees on state mandated charges is the best way to keep the total cost as low as possible. These are the costs that business owners need to anticipate when forming and maintaining their LLC.