Forming a limited liability company (LLC) in Wisconsin can provide important legal protections and tax benefits for your business. But before taking the plunge, it’s essential to understand the potential costs involved. While LLC expenses aren’t exorbitant, there are still a number of required state filing fees, taxes, licenses, and services that can add up. Being informed on the full range of Wisconsin LLC costs is key to budgeting wisely as you start your business.
Don’t let the fees deter you. The perks of forming an LLC typically outweigh the initial costs long-term. By learning the step-by-step requirements and expenses, you can launch your Wisconsin LLC affordably, efficiently, and with full confidence.
Before diving into the costs, let’s review some of the top advantages that make forming an LLC worthwhile for many Wisconsin business owners:
Launching an LLC in Wisconsin involves a few key steps, each accompanied by certain state filing fees and administrative expenses:
Your first step is brainstorming and choosing the perfect business name. You’ll want a name that resonates with your brand and is available for use in Wisconsin. Thankfully, you can conduct a free business name availability search on the Wisconsin Department of Financial Institutions website. Simply enter your desired name, and they’ll let you know if it’s taken.
If your ideal LLC name checks out, you may want to file for an optional yet affordable name reservation to secure the name for up to 120 days. This costs just $15 in Wisconsin. Those planning to operate under a trade name or “Doing Business As” name will also need to complete a separate filing and pay a $25 fee per name registered. Registering a DBA name simply associates the trade name with your LLC but does not provide any legal ownership of the name.
To formally create your Wisconsin LLC, the next step is preparing and filing articles of organization with the state. The articles of organization form establishes your business as a legal entity and provides important details like your LLC’s name, registered agent, business purpose, principal office address, membership structure, and more.
Filing your articles of organization costs $170 in Wisconsin. This fee is nonrefundable, so ensure your paperwork is properly completed before submitting. You’ll also owe an additional $10 for filing your Wisconsin LLC’s annual report, which is due in the calendar year following the calendar year in which your business was formed. More on that later.
All LLCs formed in Wisconsin must designate a registered agent on their articles of organization. This registered agent’s role is to receive important legal and tax documents on behalf of your LLC. By law, your registered agent must have an active business office in Wisconsin that is open during normal business hours. Their address will be listed on the state’s public records.
You have two choices when it comes to satisfying the registered agent requirement:
Unless privacy is a major concern, most small Wisconsin LLCs can safely act as their own registered agent to skip this added cost. But for larger or more public companies, a third-party service is likely worth the investment.
Drafting an operating agreement is not legally required in Wisconsin but is highly recommended for any LLC with multiple members. An operating agreement outlines important details like ownership structure, voting procedures, member responsibilities, how profits and losses are divided, how assets are distributed should the LLC dissolve, and more. Having this business “prenup” in place can help prevent disputes among members and ensure all are clear on the ground rules. It also provides helpful guidelines for amending or dissolving the LLC in the future.
You have a few options when it comes to creating an operating agreement:
Write your own – You can research operating agreement templates online and draft your own customized version for free. But lacking legal expertise, you risk overlooking important provisions.
Use an online template – Various websites sell customizable LLC operating agreement templates for anywhere from $40 to $200+. These are easy to use but still may lack the specificity needed for your unique business.
Hire a business lawyer – For $500 to $1,000 or more, an experienced business lawyer can closely review your LLC details and tailor a comprehensive operating agreement accordingly. This is viewed as the most legally protective option.
Use an LLC formation service – Some online LLC formation services include a customized operating agreement along with preparing and filing your articles of organization for one flat rate starting around $200 to $300.
Beyond the core formation requirements, you’ll need to account for the following ongoing costs associated with maintaining your LLC each year:
Your Wisconsin LLC must file an annual report each calendar year following the year it was formed to maintain active status with the state. Reports are due by December 31st. You can quickly complete Wisconsin LLC annual reports online via the Department of Financial Institutions website. The filing fee is just $10 per year. Failing to file your annual report for multiple consecutive years can result in involuntary dissolution of your LLC. So be sure to calendar your annual deadline to avoid added fees and complications.
Wisconsin does not have a state-level franchise tax or imposition tax. So you won’t need to worry about any added LLC state taxes beyond federal IRS taxes.
Most LLCs need to obtain certain Wisconsin business licenses and permits based on their industry and location. Common examples include:
Be sure to thoroughly research which licenses and permits your specific LLC will require at both the state and local level. Some municipalities also impose their own licensing requirements.
Many Wisconsin business licenses and permits need to be renewed annually for your LLC to remain compliant. For example, food handling permits must be renewed before June 30 each year, which involves a $75 renewal fee. Liquor licenses also require annual renewal and fees. Factor in these ongoing licensing expenses as you budget to operate your Wisconsin LLC each year. Set calendar reminders so you always renew licenses on time.
The good news is that most initial Wisconsin LLC formation costs can be deducted from your federal taxes:
Be sure to discuss write-offs with your accountant and properly categorize deductible formation costs when filing taxes each year. This can help offset some of your upfront LLC expenses.
Let’s recap the typical expenses involved with forming and running an LLC in Wisconsin, both required and optional:
Initial Startup Costs:
LLC filing fee (articles of organization) | $170 |
Registered agent fees | $0 to $200 or more |
Annual report filing fee | $10 |
Operating agreement creation | $0 to $1,000 or more |
Name reservation (optional) | $15 |
DBA filings (optional) | $25 per name |
License/permit renewals | $0 to $100 or more |
Business licenses | $20 to $500 |
Don’t let the list overwhelm you. Many costs are one-time startup expenses. Ongoing costs like annual reports and license renewals are quite affordable. View the costs as an investment in your business that will pay dividends down the road through liability protections, tax savings, and credibility with customers.
Forming an LLC involves thoughtful preparation and budgeting to ensure you account for all Wisconsin state fees and costs. But you don’t need to go it completely alone. Services like LLC formation companies and business lawyers can provide affordable assistance navigating the requirements. By understanding the full range of potential LLC expenses and using available resources judiciously, you can launch your Wisconsin LLC smoothly, affordably, and with full confidence. Here’s to your new entity’s success!
Your name should be relevant to your business or easily branded. You may either use it for all business activities or only in official capacity. You will also need a DBA (doing business as) as your customer-facing name.
If you plan to have employees, you need an EIN or employee identification number.
This portion of our website is for informational purposes only. Tailor Brands is not a law firm, and none of the information on this website constitutes or is intended to convey legal advice. All statements, opinions, recommendations, and conclusions are solely the expression of the author and provided on an as-is basis. Accordingly, Tailor Brands is not responsible for the information and/or its accuracy or completeness. It also does not indicate any affiliation between Tailor Brands and any other brands, services or logos.
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