It's important for business owners to research and budget for these potential fees to ensure compliance and smooth business operations both during the formation process and the steps after. The specific costs can vary widely based on location and the nature of the business. A member forming a business entity may encounter additional fees in several areas after forming their business. A few examples are below.
LLC Foreign Registrations: Registering an LLC incurs costs that vary by state and its specific requirements. If the business will operate in a state and conduct business, it may need to register with the Secretary of State or equivalent governing body.
Business Licenses: Fees may be required for obtaining the necessary licenses and permits to operate legally in a specific jurisdiction. There can be local tax registrations and license requirements based on business location and the business activity being done. This is especially true of more professions that are deeply regulated.
Annual Maintenance: Ongoing expenses such as annual reports, renewals, and compliance filings can incur charges to maintain the business's good standing. Depending on the jurisdiction, the requirement can be annually, biennially and even a few states include an initial report after registering.
Business Banking: Banking-related fees, such as account setup, transaction charges, and monthly maintenance fees, may be applicable when setting up a business bank account.
Intellectual Property: Legal fees for trademark and copyright registrations, as well as protecting intellectual property rights through patents. For example, before registering a trademark you may wish to hire a law firm to search the United States Patent and Trademark Office (USPTO) for any conflicts.
Legal Assistance: Legal costs for a new business may encompass a range of services, including employment law guidance for employee contracts and dispute resolution, assistance in addressing financial distress or restructuring, as well as conducting compliance audits and responding to regulatory inquiries. These legal fees ensure businesses remain compliant, navigate employment issues, manage contract disputes, and handle potential financial challenges effectively.
Disclaimer: The information contained in this document is provided for informational purposes only and should not be construed as financial or tax advice. It is not intended to be a substitute for obtaining accounting or other financial advice from an appropriate financial adviser or for the purpose of avoiding U.S. Federal, state or local tax payments and penalties.