How much does it cost to form a Georgia LLC or Corporation?
Georgia, the ninth-largest state in terms of economy is home to a vibrant and flexible business environment. It ranks amongst the top ten states when it comes to being the home base for first-time entrepreneurs and women-owned firms. The cost to form a Georgia LLC or corporation is also amongst the lowest making the state a favorite for startups. This guide has been specifically created to provide you with an insight into various aspects of LLC vs Corporation in Georgia including formation costs, annual maintenance costs, and advantages of LLCs and corporations.
Georgia LLC or Corporation
The two most popular business structures that first-time business owners opt for are a limited liability company and a business corporation because of the advantages they have over other business structures. The cost to form a Georgia Corporation or LLC is driven by several factors like state laws, annual fees, licensing fees, and other operating costs. The forming cost for a Georgia Corporation is almost the same as that of an LLC and is lower than many other states like the District of Columbia, Illinois, and Maryland among others.
Which business entity should I choose for Georgia business?
Georgia is amongst the top states when it comes to educational institutions, transportation infrastructure, economic activity, container ports, and fiscal stability among others. These factors play a key role in determining the cost to form a Georgia LLC or any other business structure. It is important to understand that different business structures have their own set of advantages and can have a significant impact on taxation, legal liability, ownership control, management, and even attracting funding. We have listed certain elements of a structure that will help you determine the right structure for your business.
- Control of business – If you are looking for ownership control or want to have control of the entire business then a sole proprietorship or a limited-liability company would do justice as corporations require a board of directors.
- Capital investment – All businesses require funds for starting a business or operating a business. The cost to form a Georgia Corporation can be small but operating costs can be more than you expect. It is easier to get capital investment from VCs and other private funding sources if you incorporate in Georgia as compared to forming any other business.
- Taxes – One of the key areas that helps in deciding what business structure you want is taxes. This is one of the primary reasons why entrepreneurs opt for an LLC or elect S Corporation status as both are pass-through entities. The lowering of taxes will result in lower Georgia LLC costs per year.
- Limited Liability Protection – One of the most important aspects to consider apart from the forming cost for a Georgia Corporation or LLC is liability protection. Liability protection refers to helping business owners avoid any personal liability for the debts of the company.
- Complexity – There are certain types of business structures that can have a complex registration, formation, and operation process as compared to other structures like forming and operating a sole proprietorship is easier than corporations.
Pros and Cons of Forming an LLC or Corporation in Georgia
The overall cost to form a Georgia LLC or a corporation is lower than several other states but this is not the only benefit you can derive. The state boasts of a pro-business environment driven by a robust infrastructure, skilled workforce, good macro-economic framework, low taxes, robust public financial management, and high state credit ratings. It is one of the favored states for new business formation including corporations, LLCs, sole proprietorships, etc., and that is why it is important to consider the benefits of an LLC vs a Corporation in Georgia.
A Georgia limited liability company will have several advantages as well as disadvantages as compared to other forms of businesses. Here are some of the pros and cons that will help you make an informed choice.
Pros of LLC
- If you are planning to register a Georgia LLC then there is a certain degree of flexibility that you will enjoy especially when it comes to taxation. A Georgia LLC can be taxed as an S Corporation, C corporation, sole proprietorship, or even a partnership.
- The overall cost to form a Georgia LLC is much less compared to some of the other states
- When you look at a comparison of formation costs of LLC vs Corporation in Georgia, the initial registration costs are the same.
- The members of a Georgia LLC will enjoy limited liability protection and pass-through taxation.
Cons of LLC
- If you are planning to register a limited-liability company then apart from the cost to form a Georgia LLC, you will also be required to file different types of state taxes.
- VCs and angel investors prefer a business corporation over an LLC with respect to funding and this is the biggest disadvantage of LLC vs Corporation in Georgia.
- The paperwork is more for new business formation as compared to some of the other states
- There is a Georgia LLC annual registration fee applicable for all LLC’s domestic or foreign.
Are you thinking of starting an LLC in Georgia?
A Georgia business corporation is one of the most favored structures in the state and has its advantages and disadvantages. They are:
Pros of a Corporation
- The cost to form a Georgia Corporation is less compared to some of the other states.
- If you incorporate in Georgia then one of the top benefits is protection of your personal assets.
- One of the advantages, when you compare LLC vs Corporation in Georgia, is that as a corporation, you will enjoy access to capital investments from private investors including VCs.
- One of the top benefits apart from the low cost to form a Georgia Corporation is its perpetual existence. It means that a corporation can continue to exist indefinitely regardless of the status of its owners, directors, or even shareholders.
Cons of a Corporation
- Although the cost to form a Georgia Corporation is low, there are additional costs involved like double taxation. This means that a corporation pays taxes on the income while shareholders pay tax on dividends.
- The process to incorporate in Georgia can be time consuming and may involve a lot of paperwork including submitting a notice of incorporation in local newspapers
- Since a business corporation follows a rigid structure, it has lesser flexibility as compared to other structures like a sole proprietorship or LLC.
Do you want to start a Georgia corporation?
Georgia LLC Cost
One of the most popular forms of businesses amongst new business owners is the limited liability company. Apart from the cost to form a Georgia LLC, there are several other advantages this type of structure offers. You can choose to form a Single-member LLC (SLLC) or a Multi-member LLC and also elect the S Corporation tax structure. If you are planning to form a limited-liability company then let us take a look at the Georgia LLC annual registration fee and other costs related to formation and operations.
Cost for forming Georgia LLC
When we think of the cost to form a Georgia LLC, it is not just about the initial formation or new business registration costs. There will be other costs associated with helping the business become operational. The various costs associated with a limited liability company include the following:
- One of the important initial costs to form a Georgia LLC is name reservation. You will need to file the name reservation request form with the office of the Secretary of State. If you are filing online then there is a non-refundable filing fee of $25 and if you are submitting a paper form then the fee is an additional $10 ($35).
- In order to register your business in Georgia, you will have to file the Articles of Organization with the Secretary of State. The filing fee is $100 for online submission and $110 for submission by mail or if hand delivered. This fee is an important part of the Georgia LLC cost per year.
Annual maintenance cost for Georgia LLC
Once you have registered a limited-liability company in Georgia; it is important to ensure that you meet all the standards and requirements of the state including annual registrations. There is a Georgia LLC cost per year for keeping your business operational and active. The costs involved are as under:
- Business Licenses – Once you have filed the Articles of Organization, your business is registered with the state but will not be operational unless you have obtained the necessary licenses and permits. The cost will vary according to the type of licenses or permits, the number of licenses, and the county your business is established in. It is not a part of the initial cost to form a Georgia LLC but is considered an annual maintenance cost as you have to renew licenses and permits each year.
- Annual Registration – One of the important requirements of a Georgia LLC is the annual registration also known as the annual report. The Georgia LLC cost per year for annual registration is $50 and it has to be submitted each year between January 1 and April 1.
If you are feeling overwhelmed with the several processes involved in keeping your company compliant with state laws then we, at IncParadise can assist you. We can help you to register LLC in Georgia as we possess the experience and expertise related to new business registration in the state.
Georgia Corporation Cost
If you are thinking about what the cost would be to form a Georgia Corporation then it is almost similar to that of a limited liability company. The costs can be divided into initial costs, annual costs, and recurring costs and are associated with helping a business remain operational in the state. Let us take a look at the forming cost for a Georgia Corporation as it is an integral part of new business registration.
Cost of forming Corporation in Georgia
The cost to form a Georgia Corporation is lower than incorporation costs in several other top states in the country. The cost to incorporate in Georgia is basically a one-time cost and includes:
- One of the important initial costs to form a Georgia Corporation is name reservation. You will be required to file the name reservation request form with the office of the Secretary of State. If you are filing online then there is a non-refundable filing fee of $25 and if you are submitting by hand or through mail then the fee is an additional $10 ($35).
- The primary objective of every new business is to register with the state so that conducting business is easier. As a corporation, you will be required to file the Articles of Incorporation with the Secretary of State. The filing fee is an important forming cost for a Georgia Corporation and it is $100 for online submission and $110 for submission by mail.
Annual maintenance cost for Georgia Corporation
Apart from the initial cost to form a Georgia Corporation, there will be a cost attached to the annual maintenance of the said company. This annual cost may be a recurring cost and will help your business to remain in compliance with all state laws. The annual maintenance costs involve the following:
- Business Licenses – Once you have filed the Articles of Incorporation along with the cost to form a Georgia Corporation, you will need to apply for and obtain business licenses. The costs of licenses and permits will be determined by different elements like business activity, industry, and the county your business is operating in. You may also require zonal licenses or permits. It is important to note that licenses will have to be renewed each year and hence will be a recurring cost unlike the one-time forming cost for a Georgia Corporation.
- Annual Registration – One of the important requirements of a Georgia business corporation is annual registration, which is a type of annual report. This cost is applicable after you incorporate in Georgia and the fee is $50. The annual registration has to be submitted each year between January 1 and April 1.
The cost to form a Georgia Corporation will also take into account other aspects of the business like obtaining the Employer Identification Number (EIN), and filing of annual corporate taxes. We, at IncParadise can not only provide guidance on fulfilling annual maintenance requirements and state compliances but also help you to incorporate in Georgia.
Need any Assistance in Forming Your Georgia LLC or Corporation
If you are planning to incorporate in Georgia or want to form an LLC in the state then there are several processes involved. You will also be required to maintain annual compliance and all this can make the new business formation process complex. We at IncParadise can provide valuable assistance by handling your new business formation or incorporation requirements while ensuring your company is compliant with all state laws.
IncParadise is one of the leading business incorporations and Georgia registered agent service providers and we have helped thousands of LLCs and corporations to form their businesses. We also provide a wide variety of additional services like getting a tax id, foreign qualification, S corporation status, and dissolutions among others.