Who should form an LLC in Tennessee?
Anyone who lives in Tennessee or runs their business from there. If you form in another state but operate in Tennessee, you will usually have to register there as a foreign LLC anyway, paying both states' fees. See home state or another state.
How do you form an LLC in Tennessee, step by step?
Choose and check the name
Search the state's business records and include "LLC", "L.L.C." or "Limited Liability Company" in the name.
Appoint a registered agent
A person or company with a physical street address in Tennessee. See what a registered agent is.
File the Articles of Organization
Online through the Tennessee Secretary of State's business portal, or by mail, with the fee based on the number of members: $300 for one to six members, then $50 for each additional member, up to $3,000.
Get an EIN and sign an operating agreement
The EIN is free from the IRS. See LLC operating agreement.
Register for state taxes
Sales tax and payroll as needed. Then note the first yearly filing date.
What does Tennessee require every year?
An annual report each year, due by the first day of the fourth month after the LLC's fiscal year ends, which is April 1 for a calendar year, starting the year after formation. The fee is the same as at formation: $50 per member, at least $300. An LLC that does not file can be administratively dissolved.
Separately, most LLCs file a franchise and excise tax return with the Department of Revenue by the 15th day of the fourth month after year end: franchise tax at 0.25% of net worth with a $100 minimum, and excise tax at 6.5% of net earnings.
For deadlines, fees and late penalties in detail, see Tennessee LLC yearly filings.
What do the first two years cost?
| Item | Cost, one to six members |
|---|---|
| Articles of Organization | $300 |
| Franchise tax minimum, each year | $100 |
| Excise tax | 6.5% of net earnings |
| First annual report, the following year | $300 |
Budget at least $400 a year to keep a Tennessee LLC, before any excise tax on profit.
Which LLCs pay franchise and excise tax?
Nearly all LLCs doing business in Tennessee, including single-member LLCs, regardless of their federal tax classification. Limited exemptions apply, such as for certain family-owned entities with mainly passive income. The franchise tax measure is now based on net worth; the older alternative measure based on property was repealed in 2024.
Should you file it yourself or use a formation service?
Filing yourself costs only the state fee, and the Tennessee filing is short enough for most owners to complete. A formation service saves time, can act as your registered agent and may send reminders for yearly filings, but compare total yearly costs: low headline prices are often paired with paid add-ons such as expedited filing, operating agreements or EIN applications, which you can do yourself free. Whichever you choose, keep the approved filing, the EIN letter and your operating agreement together. See how much an LLC costs.
Can a non-resident form an LLC in Tennessee?
Yes. Tennessee has no residency or citizenship requirement for an LLC's members or managers. You need a registered agent with a Tennessee street address and an EIN; a foreign owner without a Social Security number applies for the EIN on Form SS-4. A single-member LLC owned by a foreign person files Form 5472 with a pro forma Form 1120 every year, even with no US income. See can a non-resident own a US LLC and annual filings for foreign-owned LLCs.
What happens if you miss a required report?
The state usually charges a late fee and marks the LLC as not in good standing, which can block a certificate of good standing, a bank account or a loan. If the filing stays overdue, the state can administratively dissolve the LLC, ending its liability protection and its claim to the name. Reinstatement means filing every missing report and paying the fees owed, so put the dates in your calendar. See reinstating a dissolved LLC.
Which Tennessee taxes apply to an LLC?
Tennessee has no personal income tax, so owners pay no state tax on their share of profit, though the LLC itself pays franchise and excise tax. The state sales tax is 7%, plus local taxes; register with the Department of Revenue for sales tax and for business tax, a gross receipts tax that applies above set thresholds.
If you sell online, see Tennessee sales tax for online sellers.
Federally, a Tennessee LLC is taxed like any other LLC. See how LLCs are taxed. For a side-by-side view of state costs, see how much an LLC costs.
Want your Tennessee LLC formed?
We file your Articles of Organization, arrange the registered agent and EIN, and keep track of every Tennessee deadline for you.
Questions people ask
How much does it cost to form an LLC in Tennessee?
$50 per member, with a $300 minimum and $3,000 maximum.
How much is the Tennessee LLC annual report?
The same per-member fee, at least $300 a year.
Do Tennessee LLCs pay franchise and excise tax?
Most do: franchise tax with a $100 minimum and excise tax of 6.5% of net earnings.
Does Tennessee have personal income tax?
No.
Sources
Every fee, date and rule on this page was taken from these official and primary sources.
- Tennessee Secretary of State: Business services
- Tennessee Department of Revenue: Franchise and excise tax
- IRS: Get an employer identification number
- IRS: Employer identification number, including international applicants
Rules and fees change. If you are reading this long after October 1, 2026, confirm the figures with the source before you rely on them.
Related guides
More in State LLC formation
This guide is general information. It is not tax or legal advice for your situation.