The real cost of your LLC: what they don't tell you

You're about to form your LLC and you start comparing prices. You see $500 here, $647 there, $1,800-$3,600 somewhere else. The decision looks easy: cheapest wins. Except it doesn't. The formation price is just the tip of the iceberg. What matters is how much it costs to operate your LLC over a full year.

We analyzed the most popular providers in this market and calculated the real Total Cost of Ownership (TCO). The results may surprise you.

The entry-price trick

Most providers advertise an attractive starting price. But that price does not include what you actually need to operate. Tax filing, bookkeeping, FBAR, renewals... all of those are extras that add up fast. The full list of those extras that don't show on the provider's website is in the hidden costs of an LLC.

It's like buying a $5,000 car and then discovering insurance, maintenance and gas cost you $8,000 a year. The price of the car was the smallest line item.

TCO comparison: full year 1

We assume basic bookkeeping and full tax compliance. These are the real costs:

*Stripe Atlas does not offer these services. Prices are market estimates for hiring a US CPA or independent bookkeeper.

The cheapest provider on formation can be the most expensive in operation. The entry price is not the real price.

Stripe Atlas: fast, cheap... and then what?

Stripe Atlas is excellent at what it is: a launchpad. For $500, in 48 hours you have your LLC formed with legal documents from Cooley (a top Silicon Valley law firm) and a bank account ready.

But Atlas does nothing else. Literally:

• No tax filing — you need a CPA ($600-1,500/year)
• No bookkeeping — you need a service ($200-400/month)
• No FBAR handling — you need a preparer ($300-500)
• No Spanish-language support — everything is in English
• No compliance monitoring — if you forget the Franchise Tax ($300/year), your LLC drifts into bad standing
• Delaware only — the state with the highest franchise tax floor ($300/year minimum)

For a tech startup chasing VC investors, Atlas makes sense. For a freelancer or digital nomad who needs to operate and invoice, it's only the first step on a long, expensive road. We dig into its limits in why Stripe Atlas is not enough, and if you're coming from Europe it helps to first understand the comparison between a US LLC and European self-employment.

The "inner-circle" providers: human support, zero technology

The traditional inner-circle Spanish-speaking providers have been around for 10 years. Their strength is personal WhatsApp support and experience forming LLCs in multiple states.

But there are important gaps:

• No dashboard — no client portal, no document portal
• No tools — no calculators, no invoice generators, no tax calendar
• Opaque renewal pricing — year 2+ cost is unclear on their site
• Basic tax filing — $300 separately, no FBAR included
• No integrated bookkeeping — separate service with no published price
• No document verification — PDFs without digital signature or traceability

It's a traditional consultancy with a modern website. If what you want is someone replying on WhatsApp, it can work. If you want a complete ecosystem working for you 24/7, it falls short.

What your LLC provider should include

Before you choose, make sure your provider includes these 8 services in the base price. If any one of them is "extra" or "not available", you'll end up paying more:

1. Formation + EIN — the basics, everyone does this
2. Registered Agent — mandatory every year, cannot be missing
3. Operating Agreement — your internal constitution, should be solid
4. Annual Tax Filing — Form 1120 + 5472, not optional
5. FBAR — if the LLC has accounts outside the US with aggregate balance above $10,000, it can be mandatory
6. Bookkeeping — without bookkeeping you can't file taxes properly
7. Management dashboard — to see your LLC's status, documents, obligations
8. Support in your language — when you have a tax problem, you need to understand it

If your provider only forms the LLC and wishes you good luck, it's not a provider — it's a paperwork shop.

This isn't theory: every year people discover their LLC provider vanished, leaving them with no tax filing and no active Registered Agent. And before you choose, it's worth knowing the 5 mistakes new LLC owners make that end up costing far more than any price difference. And if you haven't decided which state to form it in yet, the Wyoming vs New Mexico vs Delaware comparison breaks down what each one costs per year.

The "low-price" argument

"But $1,800-$3,600 is way more than $647." Yes, the entry price is higher. But let's add up what you actually need to operate legally for one year:

The Manager plan at $300/month is your CFO, bookkeeper, compliance officer, tax preparer and tools platform. Try hiring just one of those roles for $300/month.

So, which is the right choice?

It depends on what you need:

• If you only want to form an LLC quickly and you already have a CPA, bookkeeper and know how to manage compliance: Stripe Atlas ($500) gets the job done.
• If you want basic human support and don't mind handling tax filing and bookkeeping yourself: a traditional consultancy ($647) is a fit.
• If you want to operate your LLC without worrying about anything, with automated bookkeeping, included tax filing, 22+ tools, and a team handling everything: Devil Club bundles formation + compliance + bookkeeping + tax filing + manager in a single price — something formation-only providers don't cover.

For a detailed comparison of our Club vs Manager plans, see the comparison page. And if you want to understand how an LLC works before deciding, our definitive guide covers everything from scratch. For broader context on US business structures, the SBA's guide is a good starting point.

Frequently asked questions

How much does it cost to maintain an LLC each year, not counting formation?

It depends on the state. New Mexico has no Annual Report: the only state-level obligation is keeping your Registered Agent active (its annual renewal). Wyoming does have an Annual Report, with an asset-based fee of at least ~$60/year. Delaware has no Annual Report for LLCs, but it does charge a minimum Franchise Tax of $300/year, due June 1. On top of that comes the federal compliance cost, which is where most people go wrong when comparing prices. The Wyoming vs New Mexico vs Delaware comparison breaks down each state.

Why can the cheapest provider end up being the most expensive?

Because the advertised price is only the formation, not the operation. What really weighs over a full year is the tax filing (Form 1120 + 5472), the bookkeeping, the FBAR and the renewals. Bought separately, those services run from $5,200 to $10,600 a year per the table above. A $500 entry price that then forces you to hire all of that separately ends up costing more than a plan that includes it. The breakdown of the extras that don't show on the website is in the hidden costs of an LLC.

What do I risk if I skip the Form 1120 + 5472 to save on tax filing?

The form itself has no filing fee (filing it costs $0), but not filing it is the expensive part: the penalty for failing to file Form 5472 is $25,000, and it applies even if your LLC had no revenue. Saving $300 on tax filing to risk a $25,000 penalty is the worst cost-to-risk ratio in your LLC's entire lifecycle. The details of that penalty are in the Form 5472 mistakes.