Starting an LLC in Alabama
To register your business in Alabama, you need to pay the $100 state filing fee to obtain a general business license. Depending on the type of business, you may need more than one license, which will increase your initial business costs.
The first step to forming an LLC in Alabama is choosing and reserving a unique name that isn’t already registered by another business with the Alabama Secretary of State. A business name can be reserved by filling out the paper Alabama LLC Name Reservation Request Form, which will take about one week with standard processing or file online for immediate processing.
If your business conducts any business under a name that isn’t your own name, you will need to file and register a DBA in Alabama.
You may also file an Application to Register Trade Name In Alabama with the Secretary of State by mail and pay a $30 fee. Registration alerts others the name is in use but does not confer any legal rights.
In Alabama, you must use your DBA name to do business before you can register it with the state. To register a DBA name, follow these instructions on the Secretary of State’s website. You’ll need to renew every five years.
Alabama business licenses can cost anywhere from $15 to several hundred dollars, depending on several factors. Refer to the Alabama DOR for business license information specific to your business.
Additional LLC Filing Costs
Other LLC filing costs may include legal services, professional fees, and other miscellaneous costs. Budget accordingly. The cost for registering a foreign LLC in Alabama is $156 online or $150 by mail. You register by filing a Foreign Limited Liability Application for Registration with the Secretary of State.
Optional costs include reserving your LLC name for 12 months for $28 online or $25 by mail. Registered agent services range from $50 to over $300 a year.
Licenses, Taxes, and Annual Requirements
Starting an LLC requires licenses and permits from local, state, and federal governments. Fees vary but most are minimal.
The main LLC filing fee in Alabama is $200. This non-refundable fee must be paid when submitting articles of organization.
LLCs in Alabama must pay an annual business privilege tax, starting at $100 minimum per year, and file a yearly $10 report, typically due by April 15. Both domestic and foreign LLCs must submit a name reservation request form before filing. LLCs can choose different tax structures like sole proprietorships or S-corporations.
To appoint a registered agent, choose a person or company that can receive your LLC’s legal documents and notices in Alabama. They must have an in-state street address. A registered agent serves as your business’s representative to the state.
Frequently Asked Questions
Do I need a business license if I have an LLC in Alabama?
To form an LLC in Alabama costs $100 to file and $50 for a separate court fee. You must also reserve your business name. LegalZoom can form your LLC starting at $99 by answering simple questions.
An Alabama business license gives your LLC permission to operate. You need one for your location and industry. LegalZoom identifies licenses needed for $99.
Alabama charges a 4% sales tax. Businesses collecting sales tax need an Alabama sales tax license. Sole proprietors usually don’t need a general business license but may need other licenses and permits.
To get a business license, provide your business name, location, ownership structure, and tax ID numbers. The process takes weeks. You need a federal tax ID number to get a license.
LLCs must pay Alabama’s business privilege tax yearly starting at $100, plus a $10 report fee. LLCs can choose tax structures like sole proprietorships or S-corporations.
Register your DBA name with the Secretary of State for $30 if different than your LLC name. Your LLC must use the DBA before registering it.
Appoint an in-state registered agent to receive legal documents for your LLC. They must have an Alabama street address.