Know the True Costs of US Company Registration - Must-Know Details!

Starting a Business in the U.S. Understanding the True Costs of Company Registration

For many entrepreneurs, starting a business in the United States represents a significant milestone. The first step toward achieving this goal is company registration. However, for those new to the U.S. market, understanding the actual costs involved can be challenging. Fees vary widely depending on the state and business structure, and hidden costs often make it difficult to accurately estimate the total budget. This article will explore recent news and provide a detailed breakdown of key expenses in the U.S. company registration process.

1. Basic Registration Fees Vary by State

The U.S. operates under a federal system, meaning that each state governs its own business registration procedures-and fees. Popular states for business formation, such as Delaware and California, illustrate these differences clearly.

Delaware One of the most popular states for incorporation, Delaware charges $90 for LLC registration and $89 for C-Corporations. Additionally, an annual franchise tax applies-$300 per year for LLCs, while C-Corporations pay between $75 and tens of thousands of dollars depending on capital stock.

California Registration costs are higher here. An LLC pays $85 to register and must also pay an $800 minimum annual tax every year-even if no income was generated. A Statement of Information must also be filed at the time of initial registration, which may incur additional fees.

According to a 2025 Wall Street Journal report, more small business owners are considering registering in Nevada or Wyoming due to the absence of corporate income taxes and lower overall costs. For example, Wyoming charges only $100 to register an LLC, with no annual reporting requirements or state-level corporate taxes.

2. Legal and Service Agent Fees Hidden but Essential Costs

While many U.S. states allow individuals to complete the registration process independently, most entrepreneurs opt for legal or professional services to ensure compliance and avoid future complications. These services typically include

Advice on business structure e.g., LLC vs. S-Corp

Preparation and submission of documents

Appointment of a Registered Agent

Industry data suggests that professional registered agent services range from $100 to $500 annually. If legal consultation is included, costs can exceed $1,000. Online platforms like LegalZoom and Incfile offer packages ranging from $100 to $400.

In August 2025, TechCrunch reported on a startup that failed to properly select its tax classification during registration, leading to complex tax filings later on. The company eventually spent over $3,000 to restructure its entity. This case highlights how investing in professional services upfront can prevent costly mistakes down the line.

3. EIN Application Free but Essential

Every business registered in the U.S. must obtain an Employer Identification Number EIN from the Internal Revenue Service IRS. This number acts as a unique identifier for tax purposes, required for opening bank accounts, hiring employees, and filing taxes.

The good news is that applying for an EIN is completely free and can be done online through the IRS website. However, non-U.S. residents without a Social Security Number SSN or Individual Taxpayer Identification Number ITIN may find the process more complicated, sometimes requiring mail or phone correspondence with the IRS, which can take longer.

4. Licenses and Permits Industry and Location Dependent

Beyond basic company registration, certain industries require additional licenses or permits. These can range from $50 to several hundred dollars, depending on location and industry type.

For example

In New York City, all new businesses must obtain a Business Registration Certificate for approximately $90.

In California, companies in construction, real estate, or food sales may face licensing fees ranging from hundreds to thousands of dollars.

With the rise of remote work, many startups now use virtual office addresses for registration. While convenient, this practice may affect eligibility for certain local licenses, so entrepreneurs should carefully consider their registered address.

5. Ongoing Maintenance Costs Don’t Forget the Annual Expenses

Registering a company is just the beginning. Long-term maintenance involves recurring costs, including

Annual Report Fees Most states require yearly reports, costing between $50 and $500.

Registered Agent Fees Non-residents typically need a registered agent to receive legal notices, costing around $50 to $200 per year.

Accounting and Tax Services Especially for international entrepreneurs, hiring a professional accountant is often essential. Annual fees vary based on complexity.

According to a 2025 CNBC survey, about 40% of small business owners underestimated their annual maintenance costs, leading to financial strain. When planning your budget, always factor in long-term operational expenses.

Conclusion

The cost of registering a company in the U.S. goes far beyond the initial filing fee. From setup to ongoing operations, each phase comes with its own set of expenses. Choosing the right state, using professional services wisely, and planning your tax structure in advance are all critical steps in managing costs effectively.

For aspiring entrepreneurs, understanding these true costs is essential to laying a solid foundation for success in the U.S. market.