Business Registry and LLC Fees In Tennessee

A limited liability company (LLC) is a legal business entity structure that combines the limited liability feature of a corporation with the flexibility of a partnership or sole proprietorship.

A limited liability company (LLC) is a legal business entity structure that combines the limited liability feature of a corporation with the flexibility of a partnership or sole proprietorship. Because of that, the business owner will have no personal liability for the actions and debts of the company. At the same time, the company can be a pass-through entity in terms of taxation. It also does not have to observe the same formalities as a corporation.

Business Registry In Tennessee

Forming an LLC involves the completion of a state process. While it is affordable and easy, there are multiple tasks a company has to do.

In Tennessee, an interested party has to register with the Secretary of State. This is done by filing the necessary form, paying the corresponding fees, and meeting all of the requirements.

LLC Fees And Requirements

There are two main categories when it comes to expenses for LLC business registry in Tennessee. The first type refers to those necessary for the forming of a business. The other one refers to the ongoing fees required for the maintenance of the company.

Forming An LLC

  • Reservation Of A Business Name – Tennessee has set naming guidelines for all business entities in the state. One of those is distinguishability. That means an LLC needs to have a unique name. If another entity already uses the name, the company may have to think of a different one or seek name consent.To prevent any issues, the company will have to do a name availability check on the business entity database of the Secretary of State.For companies that already have desired names but are not yet ready to register, the state allows the reservation of a business name for four months. File an Application for Reservation of Limited Liability Company Name form with the Secretary of State and pay the $20 fee.
  • Registered Agent And Office – The state requires companies to appoint and maintain a registered agent. The name and address of which will be listed on the formation documents of the LLC. A registered agent can either be an individual or a company. They will be in charge of accepting services of process, business mail, and other government correspondence on behalf of the company. They will help ensure that the business remains compliant with all state obligations.

Here are the qualifications in the state of Tennessee:

    • If the company opts for an individual, they need to:
      • Be a resident of the state
      • Have a physical address in Tennessee
      • Always be available in the listed address during normal business hours
      • Be at least 18 years old
    • If the LLC nominates a commercial registered agent, they should:
      • Have a physical address in Tennessee
      • Be present at the said address during regular business hours
      • Be in good standing with the state
      • Be authorized to do business in Tennessee
  • Business Registry in Tennessee Filing – The company will have to file formal paperwork with the Secretary of State. Doing this will formally register the business and legalize its operations in the state. The filing of paperwork, which is known as the Articles of Organization, costs $50 per member with a minimum of $300 and a maximum of $3,000.The form requires the disclosure of the following information:
    • Company name
    • Name consent if necessary
    • An additional designation if applicable, such as for non-profit, professional, or series LLCs
    • The name and address of the registered agent
    • The end month of the company fiscal year
    • The effective date of the Articles of Organization if not upon filing
    • The management structure
    • The number of LLC members
    • Principal office address
    • Whether the LLC is a non-profit, professional, or series LLC
    • Whether the members will be personally liable for the debts of the LLC
    • Whether the company is prohibited from doing business in the state
    • Signature of an authorized person, which can either be a member or an organizer
  • Assumed Name – An LLC may choose to use a name that is different from the legal name stated in its formation documents when it does transactions. In such cases, the company will have to file for an assumed name. This is also known as doing business as (DBA) or a fictitious name. The registration for an assumed name will be completed by filing an Application for Registration of Assumed Name with the Secretary of State and paying the $20 fee. A name registration in Tennessee is good for 5 years and is renewable. It is important to note that filing for an assumed name can only be done after the LLC is registered. This step is also optional.

Ongoing Compliance

  • Annual Report – Tennessee LLCs have ongoing obligations for as long as they exist. One of these is the filing of annual reports. Filing them will update and confirm the basic information about the company. The Secretary of State allows mailed submissions or the completion of the report on its website. Provide the following pieces of information when filling out the annual report:
    • The principal office and mailing addresses
    • The name and office address of the registered agent
    • The names and addresses of the members and managers

The deadline for the annual report is the first day of the fourth month following the end of the company’s fiscal year. For instance, if the fiscal year ends on December 31, the annual report will be due by April 1. The filing fee is $50 per member, with a minimum of $300 and a maximum of $3,000.

  • Business Licenses And Permits – Certain industries, business activities, and geographical locations may need business permits and licenses. For federal business licensing requirements, check with the U.S. Small Business Administration. As for the state, the website of the Secretary of State has information on the requirements and application processes. Meanwhile, the county and municipality licensing requirements are determined by the local Chamber of Commerce.
  • Business Taxes – By default, LLCs are pass-through entities in terms of income taxation. That means the company will not be taxed at a corporate level. Instead, the members file business income and losses in their personal tax returns.In some cases, LLC owners may choose to elect corporate taxation. The federal corporate tax rate is 21%.Tennessee may also impose franchise and excise taxes. For these, LLCs will have to register with the Department of Revenue by mail or in person. The franchise tax rate is 0.25% of the company’s net worth or real and tangible property in the state. There is a minimum amount of $100. Meanwhile, the excise tax rate is 6.5% of the company’s net earnings from its operations in Tennessee.
  • Employer Taxes – If a Tennessee LLC has employees, then it will have to pay employer taxes both at a federal and state level. For federal taxes, check with the Internal Revenue Service (IRS). Make sure the company has an Employer Identification Number (EIN). It can be obtained from the IRS online for free. The EIN will also be necessary for hiring employees and opening business bank accounts.Tennessee employer tax is at a flat rate of 2.7%. The company may also need to pay state unemployment insurance taxes, which are handled by the Department of Labor and Workforce Development.
  • Sales And Use Taxes – Companies selling goods to customers in the state may have to collect and pay sales and use taxes. For this purpose, an LLC will have to register with the Department of Revenue online or by paper form. The company will receive a sales tax permit and will have to make periodic sales tax payments and submit returns.

Getting Help With Your Business Registry In Tennessee From Experts

Forming and maintaining an LLC comes with various obligations and responsibilities. For some business owners, handling all of those tasks can be a bit overwhelming. Additionally, preparing formal paperwork and completing state processes may be time-consuming.

Fortunately, your company does not have to take care of everything. There are third-party organizations like DoMyLLC that offer filing and business compliance services.

Hiring our team of experts will give you access to various solutions that will ensure compliance with state obligations, from the business registration to ongoing maintenance requirements. We also provide personalized solutions to make sure the client receives services suitable for their specific needs and circumstances.

Additionally, we have experience in handling requirements in all 50 states, including the District of Columbia. Contact us now to find out how your company can benefit from our services.

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