To start an LLC in Alabama, file the Certificate of Formation with the Alabama Secretary of State. The state filing fee is currently $200. Alabama also requires a name reservation before you file, which costs $28 online.
What's Different About Alabama
- Alabama requires you to reserve your LLC name before filing the Certificate of Formation.
- No annual report with the Secretary of State for LLCs.
- Business privilege tax: since tax year 2024, a computed tax of $100 or less is fully exempt. LLCs above that file Form PPT with the Department of Revenue.
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Choose a Business Name
Your name must include "Limited Liability Company," "LLC," or "L.L.C." and be different from names already on file with the Alabama Secretary of State.
Search Alabama Business Records
Search the state's business database before filing to make sure your name is available. Alabama then requires you to reserve the name ($28 online).
Choose a Registered Agent
Every Alabama LLC needs a registered agent with a physical street address in the state, available during business hours to receive legal papers. You can serve yourself if you qualify, or hire a service.
File the Certificate of Formation
File with the Alabama Secretary of State. The state fee is $200. Alabama also requires a name reservation before you file, which costs $28 online.
Prefer Help Filing Your LLC?
If you'd rather have a service help prepare and file your LLC formation documents, you can review the LLC formation services from LegalZoom or Bizee. A formation service is optional — you can always file directly with the state yourself.
Affiliate disclosure: We may earn a commission if you purchase through these links, at no additional cost to you.
Create an Operating Agreement
Alabama doesn't require you to file an operating agreement, but a written one protects your liability shield and sets the rules for running the business.
Get an EIN
Apply for a free Employer Identification Number directly from the IRS. You'll need it for a business bank account, hiring, and most tax filings.
Register for State Taxes and Local Licenses
Register with the Alabama Department of Revenue for any state taxes that apply, such as sales tax if you sell taxable goods or services. Check with your city and county for local business licenses.
Set Up Business Finances
Open a separate business bank account and set up simple bookkeeping so business and personal money never mix.
Keep Your LLC in Good Standing
Alabama doesn't require an annual report for LLCs. Keep your registered agent and address current with the state, and file your tax returns on time.
How Much Does It Cost to Start an LLC in Alabama?
| Fee | Amount | When |
|---|---|---|
| Certificate of Formation | $200 | One time |
| Required name reservation | $28 | Before filing |
| EIN from the IRS | $0 | One time |
Fees and requirements can change. Verify current amounts with the appropriate government agency before filing. Optional services such as registered agents or formation companies are not included above.
Ongoing Alabama Requirements
- Business privilege tax return (Form PPT) only if your computed tax is more than $100.
- Local business licenses from your city or county, renewed yearly.
- Keep your registered agent and business address current with the state.
Federal note: since March 2025, LLCs formed in the United States are not required to file beneficial ownership (BOI) reports with FinCEN.
Common Alabama LLC Mistakes
Using a P.O. box as the registered agent's address. Alabama requires a physical street address.
Forgetting local business licenses, which are separate from forming the LLC.
Frequently Asked Questions
How much does it cost to start an LLC in Alabama?
The state filing fee is $200, plus a required name reservation. There's no annual report fee.
Does a Alabama LLC have to file an annual report?
No. Alabama doesn't require an annual report for LLCs, but you must keep your registered agent information current and file your taxes.
Official Sources
Related LLC Guides
Alabama LLC Cost
Every required government fee, plus what's optional.
Read the GuideWhat Is a Registered Agent?
What a registered agent does and who can serve as one.
Read the GuideHow to Get an EIN
Apply directly with the IRS — the application is free.
Read the GuideOperating Agreement Guide
What your agreement should cover, based on your ownership.
Read the GuideAlabama Business License
Formation and licensing are separate — see what applies to you.
Read the GuideAlabama LLC Annual Report
What to file each year, the fee, and the deadline.
Read the GuideWhat to Do After Forming Your LLC
The practical steps that come next.
Read the GuideStarting in Another State?
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