Home › State Guides

What Does an LLC Cost in Tennessee?

Tennessee looks cheap until you count members and taxes. A one to six member LLC pays $300 to form, $300 for its first annual report, and the $100 minimum franchise tax, a $700 first year in required state charges, and then at least $400 a year to stay alive. Larger LLCs pay more on the same per member formula, up to a $3,000 cap on each filing. Here is the whole state bill.

By the LLCForming research teamFees checked Nov 8, 2026

Year one: what you pay to exist

Year-one cost in Tennessee	Amount
Articles of Organization (Form SS-4270), 1 to 6 members	$300
First annual report, same per member formula, 1 to 6 members	$300
Franchise tax, annual minimum	$100
EIN from the IRS	$0
Operating agreement (you write it, not filed)	$0
Total state cost, year one	$700

That $700 is the complete required state total for a one to six member, calendar year LLC: $300 to form, $300 for the first annual report due April 1 after your first fiscal year closes, and the $100 minimum franchise tax. It is a formula total, not a flat fee. Add a seventh member and formation rises to $350 and the annual report rises to $350 with it. At 10 members each filing is $500, and each is capped at $3,000 at 60 members. Two items sit outside the $700 by design. Excise tax is 6.5% of Tennessee taxable income, so it is $0 with no net earnings and a percentage, not a flat charge, when there are earnings. The $15 county business license, and a second $15 city license where your city issues one, depend on your location and sales tier, so they are priced in the extra table below rather than folded into a statewide total. Paying the filing fee by card or e-check adds a convenience fee whose amount the state forms do not print. Mailing a check avoids it.

Every year after: the cost of staying alive

Recurring cost in Tennessee	Amount
Annual report, 1 to 6 members	$300 minimum, $50 per member over 6, capped at $3,000
Franchise tax	$100 minimum, then 0.25% of Tennessee net worth
Excise tax	6.5% of Tennessee taxable income, $0 with no net earnings
Business license, county and, where issued, city (local, not counted in the state total)	$15 per license
Typical recurring total	$400/yr minimum

Budget the $400 minimum, and respect what backs it up. The Secretary of State confirms that a business entity that has failed to file its annual report on a timely basis may be administratively dissolved and placed in inactive status. No dollar late penalty for a late LLC annual report appears on the official pages and forms reviewed for this guide, so this page does not invent one. The cost of a lapse is the dissolution itself and the fix: reinstatement on Form SS-9410 costs $70, and tax clearance verification from the Department of Revenue must be obtained before the application will be accepted. The official forms do not state how long after dissolution reinstatement remains available, so do not rely on a window quoted by a secondary guide. File the report, every year, by the first day of the fourth month after your fiscal year ends.

What drives the Tennessee total, year one vs. later

Tennessee's total is driven by repetition. The per member formula that prices formation prices the annual report too, so a member count decision made at formation repeats every year. Year one stacks three charges: the $300 formation floor, the first $300 annual report, and the $100 minimum franchise tax. Later years drop the formation fee and settle at a $400 floor, $300 for the report plus $100 minimum franchise tax, for any LLC with six or fewer members. Growth pushes the total in two directions at once. More members raise both per member filings toward the $3,000 cap, and more net worth raises franchise tax above its $100 minimum at 0.25%, while excise tax at 6.5% follows Tennessee taxable income and is $0 in a year with no earnings. That is why Tennessee cannot be honestly priced as a single flat number for every LLC. The $400 recurring figure on this page is a floor for a small LLC, stated as a floor, with the formulas that raise it printed next to it.

Tennessee franchise and excise taxes, in plain terms

These are entity level taxes on the LLC itself, filed with the Department of Revenue, and they are the figures Tennessee cost pages most often get stale. The property measure of franchise tax was repealed in 2024, and the current Department of Revenue pages state net worth only:

Item	Current figure
Franchise tax rate	0.25% of Tennessee net worth
Franchise tax minimum	$100 per year, payable even if the LLC is inactive
Franchise tax basis	Net worth only. The book value of Tennessee property measure was repealed effective for tax years ending on or after January 1, 2024
Excise tax rate	6.5% of Tennessee taxable income
Combined return	Form FAE-170, filed through TNTAP
Return due date	15th day of the fourth month after the close of the books, April 15 for a calendar year business
Business license	$15 per license, from the county clerk and, where issued, the city clerk
Business license tiers	Under $3,000 gross sales, no license. $3,000 to under $100,000, minimum activity license, no business tax account required. $100,000 or more, standard license, business tax account and filing required, minimum $22 business tax

Because franchise tax above the minimum and excise tax are percentages of net worth and income, they are excluded from the flat totals on this page, the same way income taxes are. Only the $100 franchise tax minimum is flat enough to include, and it is included. Quarterly estimated payments apply when the combined liability threshold in the Department of Revenue's due dates guidance is met. Members' federal income tax on pass through income is an owner level item, not an LLC flat charge, and Tennessee business tax is a gross receipts tax priced by business activity, not a flat rate.

Run your own version, with an optional registered agent added, in the LLC cost calculator. Every state's year-one and recurring totals sit in one table on the national cost hub, and if a service would act as your agent, the registered agent price tracker follows what that costs at each tracked provider. If you would rather a service handled the filing, the services comparison prices that honestly, renewals included.