Think about your LLC a year from now: raking in profits and taking Wisconsin by storm. You have big plans, but before your business can officially take off, you’ll need to make a bit of an investment.
And we’re not talking about renting office space or paying employees – before you sell a single product, there are startup costs associated with launching an LLC in Wisconsin.
While you’re making plans and dreaming big, make sure that you consider all the possible costs associated with starting an LLC. To help you out, we’ve compiled the most common Wisconsin startup fees here.
Quick Note: If you’d like to keep your costs of starting an LLC as simple and low as possible, consider hiring ZenBusiness – a reliable business formation service. To get a better idea of the value they offer and how it works, we compared them to the two most well known services:
Bare Minimum Cost to Start an LLC in Wisconsin
- Optional: LLC Name Reservation Fee
- $15 for a paper application, plus an optional $25 for expedited processing
- Required: Articles of Organization Fee
- $130 for online filing and $170 for hard copy filing, plus an optional $25 for expedited processing
Overall Wisconsin LLC Formation Costs
LLC Name Reservation Fee
Do you have a perfect business name in mind? You might consider protecting it by filing a name reservation. It’s a great option if you aren’t ready to start your business yet. A reservation costs $15 and places a 120-day hold on your desired name. However, if you’re prepared to start your business right away, skip this step. You can save time and money by going straight to the Articles of Organization, which will automatically register your name
Articles of Organization Fee
This is the big one, the most important (and most expensive) form that you’ll file to start your Wisconsin LLC. The Articles of Organization is what officially registers your business with the state, so you’ll want to file it as soon as you can. Online filings cost $130 and hard copy filings are a little bit more: $170. However, after it’s accepted, you won’t need to file the Articles of Organization again, so this is a one-time fee.
Business and Professional Licenses
On top of the Articles of Organization, some LLCs need to obtain licensure from state agencies or local governments before doing business in Wisconsin. Check to see if your business requires state licensure on the Department of Safety and Professional Services website. Additionally, individual cities and/or counties often have their own licensure requirements, so you should also contact your local government to find out which ones your LLC may require.
LLC Formation Service
Starting an LLC can be a complicated and time-consuming process. If you want to spend less time on paperwork and more time planning your business, you might opt for an LLC formation service. These services take care of the registration process for you, so you don’t have to spend the time on research, paperwork, and filings.
Most of these services (like ZenBusiness and Northwest) offer basic LLC formation service like Articles of Organization filing, tax consultations, and phone/email support for a flat rate, with options to pay more for premium packages with premium services like Employer Identification Numbers, Operating Agreements, and expedited filing.
Registered Agent Service
Appointing a registered agent is an important part of your LLC formation process. Your registered agent is responsible for handling sensitive legal and tax documents and keeping your business compliant with Wisconsin business law. In short, you need an agent you can trust.
While you can be the registered agent for your own LLC, this puts pressure on you to keep up with business filings and potential legal disputes. Sometimes it’s better to hand off that responsibility to a professional. A registered agent service ensures that your annual reports and other forms are filed efficiently and on-time, saving you from the penalties of delinquent filings and the stress of having to do it yourself.
Not all registered agent services are equal, so you’ll need to be careful in choosing one. Fortunately, we’ve done some research for you, and we recommend Northwest Registered Agent. In addition to registered agent services, Northwest also handles LLC formation — and they’ll include a registered agent free for one year when you form your business with them. We think they’re the most reliable choice, but if you’d like to evaluate all your options, check out our Best Registered Agent Services guide.
If you have questions or concerns about the LLC formation process or if it’s the best business structure for you, sometimes it’s best not to take chances and consult an attorney. They’re not cheap, but they can provide essential business advice, professional filing assistance, and peace of mind.
Some attorneys offer free consultations (usually 30-60 minutes) but will charge by the hour after that. On average, business attorneys charge between $150-350 per hour. Some will offer a flat rate for setting up an LLC, which can range from $500-2000.
Cost variations depend on the experience and location of the lawyer. In order to make sure that you’re hiring a good fit for your LLC, you should research potential options on a site like Avvo. It offers access to a database of Wisconsin business attorneys, so you can compare rates, locations, and areas of expertise, and be confident that you’ve hired the right person for the job.
Foreign Qualification Fee
This only applies if your LLC was formed in another state and is now expanding into Wisconsin. Foreign LLCs don’t file the Articles of Organization. Instead, they submit a Foreign LLC Certificate of Registration Application.
All foreign business entities are required to foreign qualify in Wisconsin, or they could incur some pretty severe penalties. Get your LLC authorized to do business in Wisconsin by filing the Certificate of Registration Application online for $100. Like the Articles of Organization, this is a one-time cost so, as long as your application is accepted, you won’t have to worry about it again.
LLC Annual Fees
To keep its business records current and accurate, the Department of Financial Institutions requires all its LLCs to file Annual Reports by the end of the quarter during which it was formed (the due dates are March 31, June 30, September 30, and December 31). Each Annual Report costs $25 for domestic LLCs and $80 for foreign ones. File it online here, or as a hard copy by printing and mailing your online form. This is a recurring maintenance fee, so you’ll want to write it into your yearly budget.
Income taxes are typically pretty simple for Wisconsin LLCs. The federal government classifies LLCs as “pass-through” entities, meaning that the individual members report income and losses on their individual tax returns rather than submitting a separate corporate return for the business. The same goes for state income taxes. And Wisconsin doesn’t impose a “franchise” or “privilege” tax on its LLCs either.
But that doesn’t mean you’re totally off the hook. If your LLC sells merchandise, it will be responsible for paying a Sales Tax and Use Tax. And if it hires employees, it will owe a Withholding Tax and an Unemployment Tax. Register for any applicable taxes through Wisconsin’s One Stop Business Portal.
If you’ve set up your LLC to be taxed as a corporation, it will also be subject to the state’s corporate income tax and a franchise tax. Learn more about these taxes here.
What If I Don’t Pay?
Looking at all these fees, you might be thinking: how can I pay less? While you might be tempted to look for loopholes or find a way around them, this could cause you bigger problems in the future.
Right off the bat, make sure you file your formation documents – the Articles of Organization or Certificate of Registration Application – you won’t be able to begin doing business in the state. If you fail to file an Annual Report, your LLC will lose its good standing with the state, making it unable to foreign qualify in most other states, apply for business loans, renew some professional licenses, and more. Remaining out of good standing and failing to reconcile missed filings and/or fees will result in administrative dissolution by the state.
Then there are the tax penalties. They can a penalty of 5% of the amount due per month, up to 25%. See the Wisconsin Statutes Section 71.83 for more information regarding tax penalties.
Planning Your Expenses
By now, your budget spreadsheet might be looking a little crowded, but have no fear! Most of these are one-time fees that you won’t have to worry about again. Plus, with all these on the books, there won’t be any surprise costs when you register an LLC in Wisconsin.
Soon, you’ll have these fees behind you and you’ll be forging ahead, growing your business and earning profits. As you do, make sure to keep up with the few recurring fees – like Annual Reports – so your business doesn’t fall out of good standing.