Perhaps you are hoping to form an LLC in PA. 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 Pennsylvania.
On this page, you’ll learn about the following:
- Pennsylvania LLC Cost of Filing
- Taxes Payable to the Pennsylvania Department of Revenue
- Cost Comparison between states
- Other Costs
Pennsylvania LLC Cost of Filing
Here are the costs involved in forming an LLC in Pennsylvania.
Cost of Filing Formation Certificates
The Pennsylvania 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 Pennsylvania Department of State.
Pennsylvania Domestic LLC
- Online Filing costs $125.
- Decennial Report filing costs $70
- Name Reservation fee costs $70
- By Mail: Fill out the application form, and send it to Pennsylvania Department of State Bureau of Corporations and Charitable Organizations P.O. Box 8722 Harrisburg, PA 17105-8722. Costs $125.
Pennsylvania Foreign LLC
- Online Filing costs $250.
- Decennial Report filing costs $70
- Name Reservation fee costs $70
- By Mail: Fill out the application form, and send it to Pennsylvania Department of State Bureau of Corporations and Charitable Organizations P.O. Box 8722 Harrisburg, PA 17105-8722. Costs $250.
Note that filing online is ideal, not only because you need to go to the Department of State office, but also it would be faster. You won’t have to wait in a queue in doing so.
Pennsylvania LLC Formation Service or Registered Agent Fee
You need a registered agent to form an LLC in Pennsylvania, 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 Pennsylvania Department of Revenue for regulatory boards or agencies requiring licensing.
Taxes Payable to the Pennsylvania Department of Revenue
The registration of the LLC in Pennsylvania is possible by following a simple step-by-step procedure. You can file for your LLC by mail as well as online. The business taxes that An LLC has to pay in Pennsylvania are:
State Income Tax
State Income tax is levied on all the income you make from your LLC, & your earnings are taxed through your personal tax return. The standard income tax rate in Pennsylvania is 3.07%. One can apply for all the standard allowances and deductions while filing the Income Tax Return.
State Sales & Use Tax
All the service providers & the tangible goods sellers wishing to form an LLC are liable for the State Sales & Use Tax. The State Sales & Use Tax rate in Pennsylvania is 6%.
Federal Self-Employment Tax
Federal Self Employment Tax or Social Security or Medicare tax has to be paid by all the LLC members. The Federal self-employment tax rate in Pennsylvania is 15.3 percent.
Federal Income Tax
Similar to the State Income Tax, the Federal Income Tax also depends upon your earnings, the income tax bracket your LLC falls, the deductions, & the manner/ mode of filing.
The Federal Income Tax is levied on all the profits your LLC makes after all the deductions & allowances, such as Healthcare or Retirement Plans, are calculated.
Employee & Employer Taxes
An LLC that has many employees working under it has to pay Employee-Employer taxes. Such tax can be calculated on the basis of various factors, e.g., the amount, number of employees, etc.
Cost Comparison between states
Pennsylvania has many neighboring states, namely Maryland, Ohio, West Virginia, Delaware, etc. Let us take a look at the different rates of taxes levied on LLCs in this comparative chart.
|States||Filing Fee||Annual/Biennial Fee||Sales Tax|
|Pennsylvania||$125||Decennial – $70||6%|
In addition to the taxes listed above, there can be many other taxes or costs charged on an LLC in your region. Kindly consult with a finance professional in your region to verify the tax rates or business costs of registering an LLC in Pennsylvania.
- Pennsylvania Name Reservation: $70 for online fillings or by mail
- Doing Business As (DBA): $70 for online filling or if filing by mail
- Certified Document Copies: $55 + $1 per page if filing by mail or $40 + $1 per page for online filing
- Certified of Good Standing: $40
- 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 Pennsylvania LLC: $70
How Much Does It Cost to Maintain an LLC in Pennsylvania
To maintain an LLC in Pennsylvania you will need to pay a decennial fee of $70 along with state income tax at 3.07%, sales & use tax at 6% and federal taxes.
You’re probably wondering: How much does it cost to maintain an LLC in Pennsylvania? While there’s no single set amount, there are some things you should do. Here are some steps to follow to minimize the costs. When it comes to Pennsylvania business registration, make sure to choose an attorney with plenty of experience and a good track record. You can also choose a lawyer based on their experience and expertise in your industry.
As mentioned above, there are a few fees associated with maintaining an LLC in Pennsylvania. For instance, filing a decennial report costs $70, but this fee is only charged if you’ve filed no other reports within the previous 10 years. You should also make sure to file for all necessary business licenses, including federal, state, and local. If you don’t obtain these licenses, you risk exposing your business to hefty fines. Fortunately, most of these fees are only one time. In the event that you’ve overlooked something, you’ll know where to turn to for assistance.
Operating Agreement. Operating agreements are a legal document that outlines how the business is run and the rights and duties of its members. Having one will help you plan ahead for the business’s future events and meet other fees and requirements. Operating agreements should also be signed. Unlike in many other states, an LLC in Pennsylvania can use a fictitious name, so you don’t have to worry about your customers noticing that your business does not have a real name. However, if you plan to use an unregistered name, you should get a Pennsylvania DBA.
There are three main steps to form an LLC in Pennsylvania. You must first establish an LLC name. In addition to the name, you must have a registered agent. The registered agent is a legal role that is essential for the operation of the LLC. You can hire a registered agent service to handle this task for you. Once your LLC is approved, you must file a Certificate of Organization. This paperwork is available online or at a state-authorized business entity’s headquarters.
When creating an LLC in Pennsylvania, you need to choose a name. The name of an LLC should be unique and have no similar companies. Use a business name search engine to make sure your company name is available. You should also make sure the name ends in “Company,” “Limited” or “Limited Liability Company.” If you decide to use another name, you should make sure that it has not been used by another company.
Another step to forming an LLC is to open a business bank account. This will help keep your business expenses separate from your personal ones. Additionally, it will help with taxation and accounting. Additionally, it’s important to keep thorough records of your business’ financial transactions. You should also maintain information about your employees and contractors. When you’re looking for a lawyer in Pennsylvania, make sure to look for one that has extensive experience in the field.
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 Pennsylvania 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.