Ohio vs Tennessee LLC: fees, taxes, and which to pick
Data last updated: Apr 21, 2026Ohio charges $99 to form an LLC; Tennessee 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, Ohio runs about $1,401 less in total state fees than Tennessee. Whether that gap matters depends on whether you actually operate in one of these states or are weighing a non-resident filing.
Tennessee imposes an entity-level annual tax on every LLC ($100 minimum). Ohio does not. For pass-through LLCs that would otherwise owe nothing at the state level, that minimum is the deciding line.
On speed, Tennessee typically clears standard online filings faster than Ohio. 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.
Key differences at a glance
- Ohio costs $201 less to form ($99 vs $300).
- Ohio is $400 per year cheaper to maintain ($100 vs $500).
- Tennessee 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.
- Tennessee imposes an entity-level franchise or LLC tax that applies to pass-through LLCs. Ohio does not.
- Ohio has no annual report filing at all. Tennessee requires an annual (or biennial) report every reporting period.
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 Ohio
- Paid expedited tier
- No entity-level franchise or LLC tax
- No annual report
Only Tennessee
- No state income tax
Both states
- Online filing
- 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.
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 Ohio, business operates there No foreign LLC registration needed. You pay Ohio fees only. | $199 | $100 | $399 |
| You live in Tennessee, business operates there No foreign LLC registration needed. You pay Tennessee fees only. | $800 | $500 | $1,800 |
| Non-resident forming in Ohio with operations elsewhere You pay Ohio's fees plus a typical home-state foreign LLC registration of about $200 per year. | $399 | $300 | $999 |
| Non-resident forming in Tennessee with operations elsewhere You pay Tennessee's fees plus a typical home-state foreign LLC registration of about $200 per year. | $1,000 | $700 | $2,400 |
Ohio vs Tennessee: full comparison
| Dimension | Ohio | Tennessee |
|---|---|---|
| Online filing Can you file the formation document online? | Yes | Yes |
| Online approval time Standard, non-expedited | 5 business days | 1 business day |
| Expedited option Paid fast-track filing | $100 | Not offered |
| Annual report Required in addition to tax | None | Required, $300 |
| State-imposed annual tax Franchise, privilege, or LLC tax minimum | None | $100 minimum |
| 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 | $99 | $300 |
| State sales tax General statewide rate | 5.8% | 7.0% |
Taxes in Ohio and Tennessee
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.
Ohio tax
No entity-level franchise tax on LLCs. State income tax applies to member-level pass-through income.
Tennessee tax
$100 minimum annual tax (net-worth basis). No state income tax. Corporate rate 6.5%.
Ongoing compliance
The recurring filings each state requires after formation.
Ohio
No annual state filing. Registered agent required in Ohio.
Tennessee
Annual report $300, due on your anniversary month. Registered agent required in Tennessee.
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.
Ohio
- Check business-name availability on the Ohio entity search.
- Appoint a registered agent with a physical Ohio street address.
- File Articles of Organization for a Domestic Limited Liability Company (Form 610) for $99.
- Wait for approval. Online typically 5 business days. Paid expedite from $100.
- Adopt an operating agreement (recommended, not required by Ohio statute).
- Apply for a federal EIN (free from the IRS).
- Open a business bank account to separate personal and business finances.
- No annual state filing required in Ohio.
Tennessee
- Check business-name availability on the Tennessee entity search.
- Appoint a registered agent with a physical Tennessee street address.
- File Articles of Organization – Limited Liability Company (Form SS-4270) for $300.
- Wait for approval. Online typically 1 business days. No paid expedite offered.
- Adopt an operating agreement (recommended, not required by Tennessee 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 $300 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 Ohio and Tennessee (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 Ohio or Tennessee 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
Ohio Secretary of State, Business Services Division
- Website
- www.ohiosos.gov/businesses
- Phone
- (614) 466-3910
- P.O. Box 670, Columbus, OH 43216
- Office
- 22 North Fourth Street, Columbus, OH 43215
- Hours
- 8:00 AM to 5:00 PM Eastern, Monday to Friday
Tennessee Secretary of State, Business Services Division
- Website
- sos.tn.gov/business-services
- Phone
- (615) 741-2286
- TNSOS.CORPINFO@tn.gov
- 312 Rosa L. Parks Avenue, Snodgrass Tower 6th Floor, Nashville, TN 37243
- Office
- 312 Rosa L. Parks Avenue, Snodgrass Tower, Nashville, TN 37243
- Hours
- 8:00 AM to 4:30 PM Central, Monday to Friday
Ohio Department of Taxation
- Website
- tax.ohio.gov
- Phone
- (888) 405-4039
- Ohio Department of Taxation, P.O. Box 2678, Columbus, OH 43216-2678
- Office
- 4485 Northland Ridge Boulevard, Columbus, OH 43229
- Hours
- 8:00 AM to 5:00 PM Eastern, Monday to Friday
Tennessee Department of Revenue
- Website
- www.tn.gov/revenue.html
- Phone
- (615) 253-0600
- 500 Deaderick Street, Nashville, TN 37242
- Hours
- 8:00 AM to 4:30 PM Central, Monday to Friday
Frequently Asked Questions
-
Is it cheaper to form an LLC in Ohio or Tennessee?
Ohio is cheaper at formation ($99) than Tennessee ($300). Ongoing costs are also different: $100 vs $500 per year. Total over three years: $399 vs $1,800.
-
Can I form an LLC in Ohio if I live in Tennessee?
Yes, but your Tennessee business will almost certainly need to register as a foreign LLC in Tennessee too, which means paying Tennessee's foreign registration fee and any ongoing Tennessee obligations on top of the Ohio 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 Ohio vs Tennessee?
Ohio online: 5 business days; Tennessee online: 1 business day. Ohio offers paid expedite from $100. Tennessee does not offer paid expedite.
-
Which state has lower taxes for an LLC, Ohio or Tennessee?
Ohio: state income tax applies to member-level pass-through income, no entity-level franchise or LLC tax. Tennessee: no state income tax, plus a $100 minimum entity-level 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. Ohio and Tennessee 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 Ohio or Tennessee 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
More Ohio and Tennessee comparisons
More Ohio vs ...
Sources
- Filing fee: www.ohiosos.gov/globalassets/business/forms/610.pdf · verified April 21, 2026
Ohio Secretary of State Form 610 Articles of Organization for a Domestic LLC. Filing fee $99 stated on the form. Authority: Ohio Rev. Code §111.16 (Secretary of State fee schedule) and §1706.16 (LLC formation). - Expedited filing: www.ohiosos.gov/businesses/filing-forms--fee-schedule/ · verified April 21, 2026
Ohio SoS expedite tiers: Level 1 $100 (2 business days); Level 2 $200 (1 business day); Level 3 $300 (4 hours, drop-off only). Ohio Rev. Code §111.16(M). Level 1 recorded as the default expedited tier. - Annual report fee: www.ohiosos.gov/businesses/information-on-starting-and-maintaining-a-b… · verified April 21, 2026
Ohio does not require LLCs to file an annual or biennial report. Ohio Rev. Code Chapter 1706 (Ohio Revised Limited Liability Company Act) imposes no recurring SoS report. Fee recorded as null accordingly. - Franchise tax: tax.ohio.gov/business/ohio-business-taxes/commercial-activities · verified April 21, 2026
Ohio has no LLC franchise tax. The Commercial Activity Tax (CAT) applies to taxable gross receipts above an exclusion of $3 million for tax year 2024 and $6 million for tax year 2025 and beyond (HB 33, 2023). Rate 0.26% of taxable gross receipts above the exclusion. CAT is classified as a gross-receipts tax, not a franchise tax, so franchiseTax.applies is false. - Operating agreement requirement: codes.ohio.gov/ohio-revised-code/chapter-1706 · verified April 21, 2026
Ohio Rev. Code §1706.08 recognizes operating agreements but does not require one to be in writing or filed. Ohio Revised LLC Act (Chapter 1706) governs default rules when no operating agreement is adopted. - Foreign LLC registration fee: www.ohiosos.gov/globalassets/business/forms/617.pdf · verified April 21, 2026
Ohio Secretary of State Form 617 Registration of a Foreign Limited Liability Company. Filing fee $99. Authority: Ohio Rev. Code §1706.511. - Publication requirement: codes.ohio.gov/ohio-revised-code/chapter-1706 · verified April 21, 2026
Ohio does not require newspaper publication for LLC formation. Confirmed via Ohio Rev. Code Chapter 1706 which contains no publication requirement. - Business name search: businesssearch.ohiosos.gov/ · verified April 21, 2026
Ohio Secretary of State Business Search tool. Used to confirm name availability before filing Articles of Organization. - Sales tax rate: tax.ohio.gov/business/ohio-business-taxes/sales-and-use · verified April 21, 2026
Ohio statewide sales and use tax rate is 5.75%. County permissive and transit authority additions can bring combined local rates up to approximately 8.00%. - Corporate income tax rate: tax.ohio.gov/business/ohio-business-taxes/commercial-activities · verified April 21, 2026
Ohio repealed its corporate franchise/income tax; there is no general corporate income tax. The Commercial Activity Tax is a gross-receipts tax, not an income tax, and is not expressed as a rate on net income. maxCorporateRate is therefore null. - Filing fee: law.justia.com/codes/tennessee/title-48/limited-liability-companies/ch… · verified April 21, 2026
Tenn. Code Ann. §48-249-1007(a)(1): Initial filing fee = $50 × number of members, minimum $300, maximum $3,000. The default reported value is the $300 statutory minimum (applies to LLCs with 1-6 members). Justia mirror used because sos.tn.gov PDFs and some tn.gov pages returned 403/timeouts; language matches the SOS Form SS-4270 fee instructions. - Filing fee: sos-prod.tnsosgovfiles.com/s3fs-public/document/SS-4270%20LLC_0.pdf · verified April 21, 2026
Tennessee SOS Form SS-4270 (Rev. 01/25) Articles of Organization instructions confirm $50/member with $300 minimum, $3,000 maximum. If the articles prohibit the LLC from doing business in Tennessee, the flat fee is $300 regardless of member count. - Expedited filing: sos.tn.gov/businesses/faqs · verified April 21, 2026
Tennessee Secretary of State does not offer paid expedited processing for LLC Articles of Organization. Online filings through TNBear/TNCaB typically complete within 1 business day, which serves as the de facto expedited pathway. Recorded as 'offered: false'. - Annual report fee: law.justia.com/codes/tennessee/title-48/limited-liability-companies/ch… · verified April 21, 2026
Tenn. Code Ann. §48-249-1007(a)(2): Annual filing fee = $50 × number of members as of the annual report date, minimum $300, maximum $3,000. Due the first day of the fourth month after fiscal year close. Reported value is the $300 statutory minimum. - Franchise tax: www.tn.gov/revenue/taxes/franchise---excise-tax.html · verified April 21, 2026
Tennessee Department of Revenue Franchise & Excise Tax page. LLCs are subject to both taxes. Franchise tax: 0.25% of Tennessee apportioned net worth with $100 minimum (property-measure alternative repealed by Public Chapter 950, effective tax years ending on/after Jan. 1, 2024). Excise tax: 6.5% of Tennessee-sourced net earnings. Tenn. Code Ann. §67-4-2007 (excise), §67-4-2105 (franchise). - Operating agreement requirement: law.justia.com/codes/tennessee/title-48/limited-liability-companies/ch… · verified April 21, 2026
Tenn. Code Ann. §48-249-203: An operating agreement need not be in writing (except as articles or a prior operating agreement provision require). Tennessee law permits but does not require adoption of a written operating agreement. - Foreign LLC registration fee: sos-prod.tnsosgovfiles.com/s3fs-public/document/SS-4233%20COA%20LLC.pd… · verified April 21, 2026
Tennessee SOS Form SS-4233 Application for Certificate of Authority (Foreign LLC). Fee = $50 × number of members, minimum $300, maximum $3,000 (same statutory formula as domestic filing fee). Recorded $300 minimum. - Publication requirement: sos.tn.gov/businesses/faqs · verified April 21, 2026
Tennessee does not require newspaper publication of LLC formation. Confirmed by absence of such requirement in Tenn. Code Ann. §48-249-202 (Articles of organization) and SOS FAQ. - Business name search: tnbear.tn.gov/Ecommerce/NameAvailability.aspx · verified April 21, 2026
Tennessee Business Information Search (TNBear). Use before filing Articles of Organization to confirm name availability. - Sales tax rate: www.tn.gov/revenue/taxes/sales-and-use-tax.html · verified April 21, 2026
Tennessee Department of Revenue: statewide sales and use tax rate is 7% (general rate); 4% state rate on food and food ingredients. Local option adds up to 2.75%, for combined rates up to 9.75%. - Corporate income tax rate: www.tn.gov/revenue/taxes/franchise---excise-tax.html · verified April 21, 2026
Tennessee excise tax rate is 6.5% of Tennessee-sourced net earnings. Reported here as the state's functional corporate income tax rate; applies to C-corps, LLCs taxed as corporations, and (for entity-level excise only) to default-classified LLCs.