Is it cheaper to form an LLC in Montana or Texas?

Montana is cheaper at formation ($35) than Texas ($300). Ongoing costs are also different: $100 vs $100 per year. Total over three years: $335 vs $600.

Can I form an LLC in Montana if I live in Texas?

Yes, but your Texas business will almost certainly need to register as a foreign LLC in Texas too, which means paying Texas's foreign registration fee and any ongoing Texas obligations on top of the Montana ones. The "form elsewhere to save" math usually doesn't work for operating businesses; it only works when you have no physical operations tied to any specific state.

How long does it take to form an LLC in Montana vs Texas?

Montana online: 5 business days; Texas online: 13 business days. Montana offers paid expedite from $20. Texas offers paid expedite from $25.

Which state has lower taxes for an LLC, Montana or Texas?

Montana: state income tax applies to member-level pass-through income, no entity-level franchise or LLC tax. Texas: no state income tax, no entity-level franchise or LLC tax.

Do both states require a registered agent?

Yes. Every US state (and DC) requires every LLC to maintain a registered agent with a physical street address in the state. Montana and Texas both have this requirement. You can serve as your own agent if you live in the state; most out-of-state filers use a commercial agent for $50 to $125 per year.

Which state should I pick if I run an online business from home?

Form in the state you actually live in. Your home state's Department of Revenue treats your residence as nexus regardless of where the LLC is filed, which means you owe state income tax there anyway. Forming in Montana or Texas to escape your home state's tax doesn't work; it adds paperwork. The non-resident filings make sense when you genuinely operate nowhere in particular: international founders, purely passive holding entities, or real-estate LLCs owning property in other states.

Montana vs Texas LLC comparison

Montana charges $35 to form an LLC; Texas charges $300. Day-one sticker price is only part of the story, since most of the real cost comes from the annual obligations that stack up each year you keep the LLC open.

Over a rolling three-year window, Montana runs about $265 less in total state fees than Texas. Whether that gap matters depends on whether you actually operate in one of these states or are weighing a non-resident filing.

On speed, Montana typically clears standard online filings faster than Texas. Both states offer expedited tiers at an additional cost for filers on tight timelines.

For most small operators the choice is not really between these two states at all. It is between forming where the business actually operates and trying to route through a non-resident filing. The data below shows what each option actually costs.

Formation filing fee

Montana $35

Texas $300

Montana saves $265

Year 1 total estimate

Montana $135

Texas $400

Montana saves $265

Ongoing per year

Montana $100

Texas $100

Tied

3-year total

Montana $335

Texas $600

Montana saves $265

Key differences at a glance

Montana costs $265 less to form ($35 vs $300).
Texas has no state individual income tax; pass-through LLC income flows to members without a state layer. The other state does tax at the member level.
Texas imposes an entity-level franchise or LLC tax that applies to pass-through LLCs. Montana does not.

Where each state fits

For most filers, forming in the state you actually operate from is the right call. The side-by-side below shows where the two states meaningfully diverge.

What each state offers that the other does not

Only Montana

No state sales tax
No entity-level franchise or LLC tax

Only Texas

No state income tax

Both states

Online filing
Paid expedited tier
No publication requirement
Operating agreement not statutorily required

Three-year cost, side by side

Rough estimate of the state-facing cost to form and keep an LLC through three years. Both totals include a $100 per year registered-agent estimate.

Montana Texas

Year 1

$135

$400

Year 2

$235

$500

Year 3

$335

$600

Running total includes the one-time filing fee and annual ongoing costs (report fee or franchise tax plus a $100/year registered agent estimate).

What it costs under your specific situation

The table below runs the same LLC through four common scenarios. "Non-resident" rows assume a typical home-state foreign LLC registration adds about $200 per year of stacked cost; the real number depends on which state you live in and ranges from $50 to over $800 depending on jurisdiction.

Scenario	Year 1	Each year after	3-year total
You live in Montana, business operates there No foreign LLC registration needed. You pay Montana fees only.	$135	$100	$335
You live in Texas, business operates there No foreign LLC registration needed. You pay Texas fees only.	$400	$100	$600
Non-resident forming in Montana with operations elsewhere You pay Montana's fees plus a typical home-state foreign LLC registration of about $200 per year.	$335	$300	$935
Non-resident forming in Texas with operations elsewhere You pay Texas's fees plus a typical home-state foreign LLC registration of about $200 per year.	$600	$300	$1,200

Montana vs Texas: full comparison

Dimension	Montana	Texas
Online filing Can you file the formation document online?	Yes	Yes
Online approval time Standard, non-expedited	5 business days	13 business days
Expedited option Paid fast-track filing	$20	$25
Annual report Required in addition to tax	Required, $0	Required, $0
State-imposed annual tax Franchise, privilege, or LLC tax minimum	None	None
State income tax On pass-through LLC income at member level	Yes	No
Publication requirement Newspaper publication after formation	No	No
Operating agreement Required by state statute	Recommended, not required	Recommended, not required
Foreign LLC fee Cost to register as a foreign LLC in this state	$70	$750
State sales tax General statewide rate	None	6.3%

Taxes in Montana and Texas

How each state handles entity-level tax on LLCs. Pass-through classification means member-level income tax also applies at each member's residence state.

Montana tax

No entity-level franchise tax on LLCs. State income tax applies to member-level pass-through income. Corporate rate 6.8%.

Texas tax

No entity-level franchise tax on LLCs. No state income tax.

Ongoing compliance

The recurring filings each state requires after formation.

Montana

Annual report $0, due 04/15 each year. Registered agent required in Montana.

Texas

Annual report $0, due 05/15 each year. Registered agent required in Texas.

Formation process, side by side

What actually happens from the moment you start filing to the moment you're in good standing. Use this as a checklist.

Montana

Check business-name availability on the Montana entity search.
Appoint a registered agent with a physical Montana street address.
File Articles of Organization for Domestic Limited Liability Company for $35.
Wait for approval. Online typically 5 business days. Paid expedite from $20.
Adopt an operating agreement (recommended, not required by Montana statute).
Apply for a federal EIN (free from the IRS).
Open a business bank account to separate personal and business finances.
File your first annual report and pay $0 when it comes due.

Texas

Check business-name availability on the Texas entity search.
Appoint a registered agent with a physical Texas street address.
File Certificate of Formation: Limited Liability Company (Form 205) for $300.
Wait for approval. Online typically 13 business days. Paid expedite from $25.
Adopt an operating agreement (recommended, not required by Texas statute).
Apply for a federal EIN (free from the IRS).
Open a business bank account to separate personal and business finances.
File your first annual report and pay $0 when it comes due.

Before you pick either state

A few things that apply no matter which state you choose. These trip up enough first-time filers that they're worth stating explicitly.

Registered agent is non-negotiable. Both Montana and Texas (and every other US state) require every LLC to designate a registered agent with a physical street address in the state of formation. You can serve as your own agent if you live in the state; otherwise a commercial agent runs $50 to $125 per year. Using your own home address makes it part of the public record.

Forming elsewhere does not escape your home state's tax. If you live and operate a business from your home state, forming the LLC in Montana or Texas does not avoid your home state's income tax. The moment you transact business at home, your home state requires a foreign LLC registration, and state tax liability follows your residence regardless of where the entity sits on paper.

EIN applications are free. The IRS issues Employer Identification Numbers directly at no cost. Any service charging you to "get your EIN" is reselling a free form submission. Single-member LLCs with no employees technically don't need one for federal tax, but nearly every bank requires an EIN to open a business account.

Operating agreement matters more than the state you pick. A well-drafted operating agreement governs member ownership, management, profit splits, buy-sell terms, and dissolution. Without one, your LLC runs on the state's default rules, which are rarely what you want. California, Maine, Missouri, and New York require a written one by statute; every other state treats it as strongly recommended.

Agency contacts

Montana Secretary of State - Business Services Division

Website: sosmt.gov
Phone: (406) 444-3665
Email: sosbusiness@mt.gov
Mail: Business Services, Montana Secretary of State, P.O. Box 202801, Helena, MT 59620-2801
Office: State Capitol, Room 260, 1301 6th Avenue, Helena, MT 59620
Hours: 8:00 AM to 5:00 PM Mountain, Monday to Friday

Texas Secretary of State, Business & Commercial Section

Website: www.sos.state.tx.us/corp/index.shtml
Phone: (512) 463-5555
Email: corpinfo@sos.texas.gov
Mail: P.O. Box 13697, Austin, TX 78711-3697
Office: James Earl Rudder Office Building, 1019 Brazos Street, Austin, TX 78701
Hours: 8:00 AM to 5:00 PM Central, Monday to Friday

Montana Department of Revenue

Website: mtrevenue.gov
Phone: (406) 444-6900
Mail: Montana Department of Revenue, P.O. Box 8021, Helena, MT 59604-8021
Office: 125 N Roberts Street, Helena, MT 59601
Hours: 8:00 AM to 5:00 PM Mountain, Monday to Friday

Texas Comptroller of Public Accounts

Website: comptroller.texas.gov
Phone: (800) 252-1381
Mail: P.O. Box 13528, Capitol Station, Austin, TX 78711-3528
Office: Lyndon B. Johnson State Office Building, 111 East 17th Street, Austin, TX 78774
Hours: 8:00 AM to 5:00 PM Central, Monday to Friday

Frequently Asked Questions

Is it cheaper to form an LLC in Montana or Texas?

Montana is cheaper at formation ($35) than Texas ($300). Ongoing costs are also different: $100 vs $100 per year. Total over three years: $335 vs $600.
Can I form an LLC in Montana if I live in Texas?

Yes, but your Texas business will almost certainly need to register as a foreign LLC in Texas too, which means paying Texas's foreign registration fee and any ongoing Texas obligations on top of the Montana ones. The "form elsewhere to save" math usually doesn't work for operating businesses; it only works when you have no physical operations tied to any specific state.
How long does it take to form an LLC in Montana vs Texas?

Montana online: 5 business days; Texas online: 13 business days. Montana offers paid expedite from $20. Texas offers paid expedite from $25.
Which state has lower taxes for an LLC, Montana or Texas?

Montana: state income tax applies to member-level pass-through income, no entity-level franchise or LLC tax. Texas: no state income tax, no entity-level franchise or LLC tax.
Do both states require a registered agent?

Yes. Every US state (and DC) requires every LLC to maintain a registered agent with a physical street address in the state. Montana and Texas both have this requirement. You can serve as your own agent if you live in the state; most out-of-state filers use a commercial agent for $50 to $125 per year.
Which state should I pick if I run an online business from home?

Form in the state you actually live in. Your home state's Department of Revenue treats your residence as nexus regardless of where the LLC is filed, which means you owe state income tax there anyway. Forming in Montana or Texas to escape your home state's tax doesn't work; it adds paperwork. The non-resident filings make sense when you genuinely operate nowhere in particular: international founders, purely passive holding entities, or real-estate LLCs owning property in other states.

Full state guides

MontanaOpen Montana LLC guide →
TexasOpen Texas LLC guide →

More Montana and Texas comparisons

More Montana vs ...

More Texas vs ...

Sources

Filing fee: sosmt.gov/business/fees/ · verified April 21, 2026
Montana SoS Business Services fee schedule: Articles of Organization filing fee = $35.00 (plus $50 per series member for a series LLC). All business filings are online-only through biz.sosmt.gov.
Expedited filing: sosmt.gov/business/fees/ · verified April 21, 2026
Expedited service: 24 hours = $20, 1 hour = $100. We record the cheapest tier (24-hour) as the default.
Foreign LLC registration fee: sosmt.gov/business/fees/ · verified April 21, 2026
Foreign LLC Certificate of Authority filing fee = $70.00 (plus $50 per series member for a series LLC).
Operating agreement requirement: archive.legmt.gov/bills/mca/title_0350/chapter_0080/part_0010/sections… · verified April 21, 2026
Montana Limited Liability Company Act, MCA Title 35, Chapter 8, does not require a written operating agreement. MCA 35-8-102 defines 'operating agreement' broadly; the statute lets the default provisions of Chapter 8 govern if no operating agreement exists.
Publication requirement: sosmt.gov/business/ · verified April 21, 2026
Montana statutes and SoS filing instructions contain no LLC publication requirement.
Annual report fee: sosmt.gov/secretary-christi-jacobsen-continues-montana-business-suppor… · verified April 21, 2026
Montana SoS announced that the annual report filing fee is waived for 2026 and 2027 for on-time filings (Jan 1 - Apr 15). Fourth consecutive year of waiver. Late filings after April 15 remain $35. Cross-referenced with the fee schedule at https://sosmt.gov/business/fees/.
Franchise tax: revenue.mt.gov/taxes/corporate-income-tax · verified April 21, 2026
Montana Department of Revenue: no franchise tax on LLCs. Only entities that elect C-corp status pay the corporate income tax, which is not a franchise tax. Pass-through LLCs owe no entity-level state tax.
Corporate income tax rate: revenue.mt.gov/taxes/corporate-income-tax · verified April 21, 2026
Montana corporate income tax: 6.75% standard rate; 7% for water's-edge election; $50 minimum tax. LLCs that default to pass-through do not owe this tax.
Sales tax rate: mtrevenue.gov/ · verified April 21, 2026
Montana has no general statewide sales tax (0%). Industry-specific taxes apply to lodging, rental cars, and a few other categories but not to general retail.
Business name search: biz.sosmt.gov/search/business · verified April 21, 2026
Montana SoS Online Business Services entity name search. Confirm name distinguishability before filing.
Online filing portal: biz.sosmt.gov/ · verified April 21, 2026
Montana SoS Online Business Services portal. Montana accepts LLC formation filings online only; mail filings are not accepted for Articles of Organization. Standard processing averages 3-6 business days; expedite tiers available.
Filing fee: www.sos.state.tx.us/corp/forms/205_boc.pdf · verified April 21, 2026
Texas Secretary of State Form 205 Certificate of Formation for an LLC. $300 filing fee stated on form instructions. Authority: Texas Business Organizations Code §4.152 (formation fees).
Filing fee: www.sos.state.tx.us/corp/sosda/index.shtml · verified April 21, 2026
SOSDirect service charges a 2.7% convenience fee on credit-card transactions on top of the $300 state fee. The stated filingFee of $300 is the statutory fee exclusive of the payment-processing surcharge.
Expedited filing: www.sos.state.tx.us/corp/options.shtml · verified April 21, 2026
Texas Secretary of State expedite service: $25 per document for expedited processing (typically 2 business days). Applies to paper filings mailed or delivered to the SoS. SOSDirect online filings are normally processed within a few business days without a separate expedite fee.
Annual report fee: comptroller.texas.gov/taxes/franchise/ · verified April 21, 2026
Texas LLCs file an annual Franchise Tax Report and Public Information Report with the Comptroller by May 15. No separate filing fee for the PIR. Under SB 3 (88th Leg., 2nd C.S., effective for reports due in 2024 and later), entities with total revenue at or below the no-tax-due threshold no longer file a No Tax Due Report but still file the PIR.
Franchise tax: comptroller.texas.gov/taxes/franchise/ · verified April 21, 2026
Texas Tax Code Chapter 171 (Franchise Tax). No-tax-due threshold raised to $2.47 million for reports due 2024 forward (SB 3, 2023). Rates: 0.375% retail/wholesale margin; 0.75% other. EZ computation 0.331% on revenue up to $20M (no deductions). Confirm current threshold on Comptroller site each year.
Operating agreement requirement: statutes.capitol.texas.gov/Docs/BO/htm/BO.101.htm · verified April 21, 2026
Texas Business Organizations Code §101.052 authorizes a company agreement (Texas's term for an operating agreement). Not required to be in writing or filed; LLC may operate under default statutory rules.
Foreign LLC registration fee: www.sos.state.tx.us/corp/forms/304_boc.pdf · verified April 21, 2026
Texas Secretary of State Form 304 Application for Registration of a Foreign LLC. Filing fee $750. Authority: TBOC §9.001.
Publication requirement: statutes.capitol.texas.gov/Docs/BO/htm/BO.3.htm · verified April 21, 2026
Texas does not require newspaper publication for LLC formation. TBOC Chapter 3 governs formation filings without any publication requirement.
Business name search: mycpa.cpa.state.tx.us/coa/ · verified April 21, 2026
Texas Comptroller Taxable Entity Search (the broadly-used search for Texas business entities). SOSDirect also offers a paid name search for $1 per request.
Sales tax rate: comptroller.texas.gov/taxes/sales/ · verified April 21, 2026
Texas statewide sales and use tax rate is 6.25%. Local jurisdictions may add up to 2% for a maximum combined rate of 8.25%.

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