When you form your LLC in Iowa, you’ll have to pay certain costs to officially register your business with the state.
In addition to formation and ongoing costs, there will be business expenses like using a registered agent service, building a website, getting business insurance, and so on. So, how much does an LLC cost in Iowa?
In this guide, we break down the costs associated with forming your LLC, from the Iowa LLC filing fee to LLC upkeep prices and other business expenses.
Cost of Forming an LLC in Iowa
When forming your LLC, there are a few different costs that you may incur. These include the filing fee, LLC formation service cost, operating agreement draft, and registered agent costs.
Iowa LLC Filing Fee
To form an LLC, you must file a Certificate of Organization with the Iowa Secretary of State. The fee for filing the Certificate of Organization is $50. You may see this referred to as the “state fee.”
There are a number of LLC formation services that can file this paperwork for you. If you choose to use one of these services, you will pay the $50 state fee on top of their service fee. These fees typically start at $29 and increase for each additional service you opt to purchase.
Recommended ServiceMost people choose to use an LLC formation service to create their LLC. The cost is low and they guarantee that your filing is done correctly. Check out our #1 rated LLC service:
Northwest Registered Agent ($29 + state fees)
For more details on the formation process, check out our Iowa LLC Formation guide.
Iowa Registered Agent and Registered Office
When forming your Iowa LLC, you will also be required to appoint a registered agent. Your registered agent must be available during business hours to accept important documents on your behalf, including correspondence from the government, tax forms, and legal documents. Registered agents can be a business entity or an individual. If you aren’t sure who to appoint, you can hire a registered agent service. Registered agent service fees average $130 or more annually.
Your registered agent can be:
- A registered agent service (most common)
- Yourself (not recommended)
- Another member of the LLC
- A business attorney
Iowa LLC Operating Agreement
While not required in Iowa, an operating agreement is an important business document that every business should keep on file. In addition to defining ownership interests, it outlines each member or manager’s role and responsibilities. This helps prevent and mitigate internal disputes that might arise in the future.
Since there’s no requirement regarding state filing, the only potential costs you might incur are in having the document drafted. Many single-member LLCs and simple multi-member LLCs elect to draft this document themselves.
To draw up your agreement, consider using a free operating agreement template or document builder. This will take your total cost to $0.
Optional Iowa LLC Formation Costs
Along with the fees associated with forming an LLC, there are several optional LLC formation costs that you may encounter.
- Reserve a Name for Your LLC – Before registering your Iowa business name, you must first check to ensure it’s unique by doing a business entity name search. If you aren’t ready to file your official paperwork with the state, you can reserve the business name. The name reservation fee is $10 and is good for 120 days.
- Doing Business As (DBA) Name – If you want to operate your business under a different name than your LLC’s, you will need to file a DBA. This is often referred to as a “trade name” or “fictitious name.” There is a $5 filing fee for Iowa fictitious name submissions.
- Expedited Iowa LLC Filing – If you need your Certificate of Organization processed quickly, Iowa does offer expedited processing. The fee for five-day service is $15 and $50 for two-day processing.
- Certified Document Copies – Obtaining a certified copy of your Iowa business documents confirms that the information on file is correct. The state charges a $5 fee plus $1 per page for each certified copy you request.
- Certificate of Existence – A Certificate of Existence, also known as a Certificate of Good Standing, verifies that your LLC is legally authorized to do business in Iowa. The fee for requesting a Certificate of Existence is $5.
Iowa LLC Cost and Fees Over Time
There are a few things you need to address to keep your LLC in good standing with the state year after year. Each of these comes with costs and fees.
Biennial LLC Fee Iowa
Unlike some states, Iowa does not require that LLCs pay a business entity tax each year. LLCs are, however, required to file a biennial report with the Secretary of State every two years. This helps the state maintain accurate records and confirm any business tax requirements.
Your biennial report is due between January 1 and April 1 in odd-numbered years only. Online filings are $30 and mail-in filings are $60.
Note:See our Iowa LLC Biennial Report article for a more in-depth overview.
Registered Agent Fee
If you use a professional registered agent service, you will pay their fee annually. Pricing will depend on the service provider that you use, but usually costs around $130/year. Using a registered agent service will save you time and the hassle of handling important legal documents and filings for the long term.
If you act as your own registered agent there are no maintenance fees. However, for privacy and compliance purposes, we don’t recommend being your own registered agent.
General Costs of Running a Business
Operating a business will obviously come with more than just LLC costs. These are a few of the expenses that you may run into.
Business Bank Account
An LLC separates your personal assets from your business assets. This separation is called the corporate veil. That corporate veil ensures that if your business is sued or incurs debts, your personal assets will be protected from any liabilities.
Commingling (mixing) your personal bank account with your business can pierce your LLC’s corporate veil, which means you are no longer protected by the separated entity of your LLC.
Using a separate bank account to accept payments and pay business expenses is the only way to prevent commingling funds and piercing the corporate veil.
Business Permits and Licenses
Depending on the type of business you operate, your business may need the proper permits and licenses to legally operate in Iowa.
Alongside the permits required, your business may require industry-specific licenses to operate legally. Examples include licenses like the Iowa real estate license, Iowa insurance license, Iowa adjuster license, and so on.
Every business needs a website. There’s no better way to get in front of your customers, build your brand, and grow your business.
Fortunately, the cost and difficulty of creating a business website have come down over the years. Websites are now simple to build and cheap to keep up.
Having the proper insurance coverage can potentially save your entire business if there is a loss, accident, or lawsuit.
A few of the most common business insurance policies include:
- General liability insurance – Protects against claims of personal injury, physical injury, property damage, and more. This is the most common of all business insurance policies. Learn more about general liability insurance.
- Professional Liability Insurance – Protects against claims of inaccurate or negligent work. It’s most common in the “professional” space where businesses offer services or advice to other businesses or consumers. Learn more about professional liability insurance.
- Commercial Workers’ Compensation Insurance – This type of insurance protects your employees from on-the-job injuries or illnesses. This coverage is required if you have one or more employees. Learn more about Workers’ Compensation insurance.
The cost of business insurance varies widely based on business type, size, location, and other factors. Getting a quote is the only way to understand the actual cost of insurance for your LLC.
LLC Cost in Iowa FAQ
Do you have to pay ongoing fees for an LLC every year?
In Iowa, LLCs are required to file a biennial report. The filing fees for this report are $30 online via Iowa’s Fast Track Filing System and $45 for mail-in reports.
What’s the cheapest way to form an LLC?
The least expensive way to form an LLC is to file it yourself. The best LLC formation services start around $29. You’ll need to pay the state filing fee in either scenario. Check out our How to Start an LLC in Iowa guide to learn how to form on your own.
Can you start a Iowa LLC for free?
No. All applicants must pay the state filing fee to start an Iowa LLC. The filing fee is $50.
How much does a registered agent cost?
Do I need to pay a franchise tax for my Iowa LLC?
No. Unlike some states, Iowa LLCs are not required to pay a franchise tax.
How much does an LLC formation service provider cost?
It depends on the LLC formation company you choose. We recommend Northwest Registered Agent, which starts at $29, plus the $50 state fee, and includes the first year of registered agent services for free.
Information on this page is not to be considered legal or tax advice. Data was gathered from a multitude of sources and most recently updated in September 2022.
Any Information on this site is not guaranteed or warranted to be correct, accurate, or up to date. StateRequirement and its members and affiliates are not responsible for any losses, monetary or otherwise. StateRequirement is not affiliated with any state, government, or licensing body. For more information, please contact your state's authority on insurance.
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