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.
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.
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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.
To clarify, most states don’t require name reservations, and they’re rarely necessary. If you’re concerned about someone else registering the name you want, you could opt to simply form your LLC instead of reserving the name.
Whether you reserve your business name or not, you should always perform a Wisconsin business name search to make sure the name you want is available.
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.
The information required to file the Articles of Organization includes the official business name of your LLC, the name and address of your registered agent, an indication that your LLC will be managed by its members or a manager, the names, addresses, and signatures of your LLC’s organizers, the name of the individual who drafted the document, your phone number, and an email or mailing address for the return of the filed document.
Before we move on, we’ll quickly mention that a Wisconsin series LLC can use the same Articles of Organization form as a standard LLC. However, we don’t like forming series LLCs in this state because of some unfavorable laws and regulations. For more information on forming a Wisconsin series LLC, check out our full guide on this topic.
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.
What are some of the most commonly required business licenses for Wisconsin LLCs? If your business operates in a regulated industry, you will probably need some sort of professional license to operate in compliance with state law. On the municipal level, things like alarm permits, building permits, and zoning permits are all very common.
LLC Formation Service
Starting an LLC in Wisconsin 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 time on research, paperwork, and filings.
Most of these services (which are often frequently used LegalZoom LLC alternatives) offer basic LLC formation services 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 Wisconsin 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, saving you from the penalties of delinquent filings and the stress of having to do it yourself.
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 $500-2,000.
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.
If you don’t want to go digging for your own attorney, we compiled the following list of highly rated business lawyers in Wisconsin. All of these attorneys are primarily focused on the business world, they all receive five-star ratings from clients, and they all have excellent Avvo ratings.
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.
The information required to file your annual report includes the official business name of your LLC, the jurisdiction where you originally formed your LLC, the name and address of your registered agent, your LLC’s principal office address, the name, title, and address of your LLC’s members and/or managers, and a description of the nature of your business.
For more information on Wisconsin LLC annual reports, check out our full article on this topic!
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 franchise tax. Learn more about these taxes here.
What if I Don’t Pay?
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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 add 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.
Key Steps for Starting a Wisconsin LLC
- The first step to forming a Wisconsin LLC is to come up with a good name for your business. You’ll want to make sure the name you want is still available and hasn’t already been claimed by another business, so you’ll need to search the state’s business database to verify its availability.
- Next, you’ll need to choose your registered agent. While you can legally serve as your own registered agent in Wisconsin, this role can actually be more of a hassle than you might expect. That’s why we always recommend hiring a reputable registered agent service that can handle the responsibility of this position on your behalf.
- The third step involves the preparation and filing of your Articles of Organization. You’ll need to fill out the paperwork and pay a $130-170 fee. Once the state processes this document, your LLC will be officially open for business!
- That’s not the end of the road for the startup process though, as you’ll also need to create an operating agreement for your LLC. There is no legal requirement for Wisconsin LLCs to have written operating agreements, but it’s still an extremely important element of any LLC. The operating agreement is an internal document that outlines how your LLC will operate, and there are several aspects of this document that can prevent messy ownership disputes down the line.
- You will also need to acquire a federal tax ID number (also known as an EIN, or employer identification number). This is essentially a Social Security number for your business, as it is a nine-digit code used to file taxes, hire employees, open business banking accounts, and more.
- Next, you’ll need to register for any relevant taxes with the Wisconsin Department of Revenue, and also obtain all licenses and permits that apply to your business type. Keep in mind that, depending on the nature of your business, you might require licenses from the federal, state, county, and municipal governments.
Once you’ve finished all of these steps, you’re ready to operate a compliant business entity with the state of Wisconsin!
Key Steps for Maintaining a Wisconsin LLC
After you’ve completed all of the items in the previous section, you’ll need to focus on maintaining your LLC. The first step in this process is to open a business bank account. This will help you keep your business and personal expenses entirely separate, and it will also help immensely with your accounting and taxation responsibilities.
You should also keep detailed records of every financial transaction that takes place with your LLC. This means maintaining a file of invoices for every purchase and sale you make, along with information regarding your employees or contractors and the work they perform for your business.
As we already mentioned, annual reports are a key component of LLC maintenance in this state, and there are harsh financial penalties for delinquent reports. Additionally, you might want to hold an annual meeting to discuss goals and priorities for your LLC, although this is an optional step.
Frequently Asked Questions
Before we wrap things up, let’s take a look at some of the most common questions we hear from readers regarding the LLC formation process in Wisconsin.
What are the state business tax rates in Wisconsin?
If your LLC is taxed like a sole proprietorship or general partnership, you’ll need to pay taxes on your business income at the state’s personal income tax rates (between 3.54% and 7.65%, depending on your income level). If your LLC is taxed like a corporation, you’re required to pay Wisconsin’s 7.9% corporate income tax on your business revenue.
How quickly does Wisconsin process LLC formations?
The Secretary of State should be able to process your LLC’s formation within five business days. If you’re in a hurry, you can pay a $25 expediting fee to shorten your turnaround time to one business day.
How many small businesses are there in Wisconsin today?
The state of Wisconsin is home to more than 405,000 small businesses. Entrepreneurs of all backgrounds and business types find that Wisconsin is a great place to own and operate a small business.
What are the top small business resources and websites in Wisconsin?
The Wisconsin chapter of the Small Business Development Center is a great place to start, as they offer a wide variety of tools and resources for Wisconsin LLCs. The U.S. Small Business Administration’s Wisconsin District Office is another valuable resource, and the state’s Wisconsin Women’s Business Initiative Corporation also has plenty of good info.
Should I form my LLC in Wisconsin, or choose a state like Delaware or Wyoming?
Some people like to form their LLCs in states with favorable legal settings. For instance, Delaware is often seen as the most business-friendly state, as it has an entire court system that’s dedicated solely to business matters. As for Wyoming, this state has some of the most generous anonymity laws for LLC ownership.
However, for most people, your best option is to simply form your business in your home state. Forming in a different state can be a tremendous hassle, and it can add some unnecessary complexity to tax issues as well.
Cost to Start an LLC in All 50 States
We break down the LLC costs in detail in all 50 states. View all of our State LLC Costs guides below.