Key Takeaways
- $300 Articles of Organization filing fee (Form Online (sos.tn.gov)), paid to the Tennessee Secretary of State
- Tennessee: no personal income tax on wages; franchise and excise tax still apply (0.25% net-worth franchise tax, $100 minimum, plus 6.5% excise tax); $300 formation fee AND $300 Annual Report — among the highest combined LLC costs
- Annual Report (Online (sos.tn.gov)) due within April 1 of the year following formation, then annually on April 1 of formation, $300 fee; $25/month late fee; dissolution if delinquent late penalty
- Operating agreement not legally required in Tennessee, but strongly recommended given the state's unique tax structure and high compliance costs
- Must designate a Tennessee registered agent with a physical Tennessee street address
- No publication requirement
- Same-day filing available through LLC Attorney at no markup on state fees
Tennessee presents a mixed picture for LLC owners. There is no personal income tax on wages or salary — a significant advantage. However, Tennessee's franchise and excise tax remains in force (SB 2103 repealed only the franchise tax's property measure in 2024, leaving the 0.25% net-worth franchise tax with a $100 minimum and the 6.5% excise tax), and its $300 Articles of Organization fee and $300 Annual Report make it one of the most expensive states for combined LLC formation and ongoing compliance costs. Tennessee also treats many federally disregarded LLCs as separate taxpayers. This guide covers every step and cost, with same-day filing from $49.
Who Should Form an LLC in Tennessee?
Tennessee's economy — powered by manufacturing, healthcare, logistics, and a growing entertainment and technology sector in Nashville — supports a wide range of LLC structures. Tennessee is the right state for founders who are already based there and need a locally-registered LLC for business operations, real estate investment, or professional services.
Tennessee's no-income-tax environment on wages benefits LLC members who draw reasonable compensation from their businesses. The primary ongoing tax consideration is Tennessee's franchise and excise tax — the 0.25% net-worth franchise tax ($100 minimum) plus the 6.5% excise tax — which remains in force after SB 2103 (2024) repealed only the franchise tax's property measure. Because Tennessee treats many federally disregarded LLCs as separate taxpayers, an attorney or CPA can confirm whether and how the franchise and excise tax applies to your LLC.
Real estate investors, hospitality operators, and healthcare service providers are among the most active LLC formation groups in Tennessee. An LLC provides liability protection in each of these high-exposure industries. Tennessee's strong operating agreement statute gives founders significant flexibility to customize management, profit-sharing, and ownership transfer provisions.
When Are You Required to Form an LLC in Tennessee?
Forming a Tennessee LLC is necessary when you are taking on financial or legal risk in your business. If you are signing contracts, hiring employees, operating a physical location, or holding business assets in Tennessee, operating without an LLC exposes your personal assets to every business claim. Tennessee's active commercial real estate and healthcare markets make LLC protection particularly valuable.
Tennessee requires proper LLC registration before obtaining a Tennessee sales tax certificate, business license, and most professional licenses. Banks, commercial landlords, and institutional clients require an LLC or corporation before engaging in significant transactions. Forming your LLC first establishes the legal foundation for all of these requirements.
What's Unique About Tennessee LLCs?
Tennessee's most distinctive feature for LLC owners is the combination of high compliance costs and an entity-level franchise and excise tax. The $300 formation fee and $300 Annual Report make Tennessee one of the most expensive states for LLC owners, and SB 2103 (2024) repealed only the franchise tax's property measure — the 0.25% net-worth franchise tax ($100 minimum) and 6.5% excise tax remain in force. The absence of personal income tax on wages offsets these costs to a degree.
Tennessee eliminated the Hall Tax on investment income effective January 1, 2021, making it income-tax-free for wages and personal investment income. The franchise and excise tax, however, is an entity-level obligation, and Tennessee treats many federally disregarded LLCs as separate taxpayers — so even single-member and traditional multi-member LLCs may owe the 0.25% net-worth franchise tax ($100 minimum) and 6.5% excise tax. Confirm your status with the TN Department of Revenue.
Tennessee DBAs (assumed names) are registered at the county level with the register of deeds — not with the Secretary of State. Businesses operating under a trade name in multiple Tennessee counties must register the DBA in each applicable county. This is an important distinction from states with centralized state-level DBA registration.
Key facts:
- Tennessee's franchise and excise tax remains in force — SB 2103 (2024) repealed only the franchise tax's property measure, leaving the 0.25% net-worth franchise tax ($100 minimum) and 6.5% excise tax — and the $300 formation fee and $300 Annual Report remain among the highest combined LLC costs in the US
- Annual Report filed annually
- $300 formation fee AND $300 Annual Report fee — among the highest combined ongoing costs for LLCs
- No personal income tax on wages, but an entity-level franchise and excise tax remains (0.25% net-worth franchise tax, $100 minimum, plus 6.5% excise tax)
Selecting a Name for Your Tennessee LLC
Your Tennessee LLC name must be distinguishable from all existing entities in the Secretary of State database. It must include 'Limited Liability Company,' 'LLC,' or 'L.L.C.' Search at sos.tn.gov before filing. You can reserve a name online ($20 fee, 4-month hold) to lock it in while you prepare your Articles of Organization.
Tennessee assumed names (DBAs) are registered at the county level with the register of deeds. County fees typically range from $20 to $30. Businesses operating under a trade name in multiple Tennessee counties must register in each county separately — there is no statewide DBA registration process.
When Should You Consult an Attorney for Your Tennessee LLC?
You don't typically need a lawyer for a simple, single-member Tennessee LLC. But professional advice is essential if you have multiple owners, complex ownership percentages, high-liability risks, intellectual property, or are seeking outside funding. A lawyer makes sure your operating agreement fully protects your interests from day one.
It is highly recommended to seek professional counsel in the following scenarios:
- Multiple members or investors: You need a customized operating agreement to outline ownership stakes, voting rights, dispute resolution, and exit strategies. Off-the-shelf templates rarely cover these contingencies.
- High-risk industries: If your business faces significant liability exposure (manufacturing, construction, consulting), an attorney helps ensure the corporate veil is not pierced.
- Complex assets and IP: If your business will own patents, trademarks, or real estate, a lawyer ensures these assets are properly transferred and protected under the LLC.
- Raising capital or adding partners: If you plan to seek venture capital or issue equity to employees, you may need a different business structure entirely, such as a C-Corporation.
- State and local requirements: Tennessee's franchise and excise tax remains in force after SB 2103 (2024) repealed only the franchise tax's property measure. An attorney can help confirm whether your LLC owes the 0.25% net-worth franchise tax ($100 minimum) and 6.5% excise tax — Tennessee treats many federally disregarded LLCs as separate taxpayers — and structure your operating agreement for Tennessee law.
Unlike formation-only services, LLC Attorney gives you on-demand access to licensed attorneys: flat-fee consultations in 30-minute increments, no retainer. You can talk to a licensed attorney about Tennessee's specific requirements before and after you file.
Designating a Registered Agent
Every Tennessee LLC must maintain a registered agent with a physical Tennessee street address. The registered agent receives service of process and official state notices during normal business hours. P.O. boxes are not accepted as a registered agent address.
Using a professional registered agent keeps your personal address off the publicly searchable sos.tn.gov database. If your registered agent becomes unreachable or moves without updating the Secretary of State, Tennessee can administratively dissolve your LLC. LLC Attorney provides registered agent service in Tennessee as part of its formation package.
If the state is unable to deliver legal notices to your registered agent, Tennessee can administratively dissolve your LLC without additional warning.
Filing the Necessary Formation Documents
To form a Tennessee LLC, file your Articles of Organization with the Tennessee Secretary of State at sos.tn.gov. The filing fee is $300 — one of the highest formation fees in the country. Online filings typically process within 1–2 business days. Your Articles must include the LLC's name, registered agent name and Tennessee address, and the LLC's principal office address.
Tennessee does not require member or manager names in the Articles of Organization. Once approved, the Secretary of State issues a confirmation. Save this document — you will need it to open a business bank account, obtain a Tennessee sales tax certificate, and apply for most business licenses.
Member-Managed vs. Manager-Managed: What to Choose
When you file Form Online (sos.tn.gov), you must choose a management structure. This decision cannot be left blank.
Member-managed means all LLC owners share authority over day-to-day decisions. Every member can sign contracts, open accounts, and act on behalf of the company. This is the right choice for small teams where all owners are actively involved in running the business.
Manager-managed means one or more designated managers run the company's operations. Managers can be members or outside appointees. This structure works best when your LLC has passive investors, when operational roles differ significantly between members, or when you want to limit decision-making authority to a smaller group.
Your management structure is declared on Form Online (sos.tn.gov) and can be modified later through your operating agreement. If you are the only member and you will run the business yourself, choose member-managed. If you have investors who are not involved in operations, choose manager-managed.
Filing an Initial Annual Report
Tennessee LLCs do not have a separate initial filing after formation. Your first annual compliance obligation is the Annual Report, due April 1 in the year following formation (or April 1 of the current year if you formed before April 1).
The Annual Report fee is $300, filed online at sos.tn.gov. A $25/month late fee applies if the Annual Report is not filed by April 1. This fee accumulates monthly until the report is filed. Continued delinquency can result in administrative dissolution. Set a firm calendar reminder — April 1 is a fixed date for all Tennessee LLCs, and the $300 fee plus potential late penalties make missing this deadline costly.
Your Tennessee LLC Operating Agreement (Strongly Recommended)
Your operating agreement does not need to be filed with the Tennessee Secretary of State. Keep it with your company records and give a copy to every member.
A complete operating agreement covers: member rights and responsibilities, ownership percentages, profit and loss distribution, management structure, voting procedures, and dissolution rules. Tennessee permits written or oral operating agreements, but a written agreement is essential for opening a business bank account, managing member expectations, and establishing clear governance in a state where excise tax applicability may vary by LLC structure.
A generic template may not address Tennessee's specific rules on excise tax obligations, member authority, and profit allocations. Tennessee courts apply default statutory rules when operating agreements are absent — which may not match member intentions or optimize the LLC's tax treatment. LLC Attorney drafts operating agreements tailored to Tennessee's requirements.
Obtaining an EIN and Setting Up a Business Bank Account
An EIN from the IRS is required for Tennessee LLCs with more than one member, for LLCs that hire employees, and for opening a business bank account. Apply free at irs.gov/ein. The online application processes immediately and is available Monday–Friday, 7 a.m.–10 p.m. Eastern.
Open a dedicated business bank account as soon as your EIN is issued. Commingling personal and business funds undermines the LLC's liability shield. Bring your Articles of Organization, EIN confirmation, and operating agreement to the bank. Many Tennessee banks also require proof of Tennessee business license registration for commercial accounts.
Registering for Tennessee State Taxes and Business Licenses
Your federal EIN does not automatically register you with Tennessee state agencies. Depending on your business type, you may need to register for:
- Tennessee sales and use tax (TN Department of Revenue, if you sell taxable goods or services in Tennessee) — tn.gov/revenue
- Tennessee employer payroll taxes (TN Department of Labor and Workforce Development, if you are hiring Tennessee employees) — tn.gov/workforce
- Tennessee sales tax certificate of registration — required if selling taxable goods or services in Tennessee; excise tax may apply to certain LLCs — verify with TN Department of Revenue
Failure to register when required results in back taxes, penalties, and interest.
What to Do After Forming Your Tennessee LLC
After forming your Tennessee LLC, compliance primarily revolves around the $300 Annual Report due each April 1:
- Annual Report: $300, due April 1 each year at sos.tn.gov — $25/month late fee if missed
- No Tennessee personal income tax on wages or salary
- Tennessee franchise and excise tax (0.25% net-worth franchise tax, $100 minimum, plus 6.5% excise tax): may apply to your LLC — verify with TN Dept. of Revenue
- Tennessee sales tax certificate: required if selling taxable goods or services in Tennessee
- Tennessee business license: required for most businesses with $10,000+ in annual sales
- DBA registration: filed at the county register of deeds level if operating under an assumed name
Cost to Start an LLC in Tennessee
Tennessee has high LLC formation and annual compliance costs. The table below covers all state fees you are likely to encounter:
| Fee | Amount | Notes |
|---|---|---|
| Articles of Organization (Form Online (sos.tn.gov)) | $300 | Standard processing: Online: 1–2 business days; mail: 2–4 weeks; verify at Tennessee Secretary of State for current times |
| Annual Report (Online (sos.tn.gov)) | $300 | Due within April 1 of the year following formation, then annually on April 1; $25/month late fee; dissolution if delinquent late penalty |
| Articles of Organization | $300 | One-time formation fee paid to the TN Secretary of State — among the highest in the country |
| Annual Report | $300 | Due April 1 each year; $25/month late fee if not filed on time |
| TN Franchise Tax | 0.25% of net worth ($100 min) | Net-worth franchise tax remains in force; SB 2103 (2024) repealed only the property measure — verify applicability with TN Dept. of Revenue |
| TN Excise Tax | 6.5% | Applies to net income; Tennessee treats many federally disregarded LLCs as separate taxpayers — verify applicability with TN Dept. of Revenue |
| Registered Agent (professional service) | $100–$300/yr | LLC Attorney registered agent service available |
| Business Name Reservation | $20 | Holds name for 4 months |
| Assumed Name (DBA) / DBA | $20–$30 (county-level fee) | Tennessee assumed names are registered with the county register of deeds — not at the state level.; fee varies |
| Certificate of Amendment (Online (sos.tn.gov)) | $20 | To change LLC name later |
| Legal / Tax Advisory | Varies | On-demand attorney consults at LLC Attorney |
How to Form a Tennessee LLC Step by Step
If You Do It Yourself
Choose a business name that meets Tennessee's requirements.
Reserve your name if you need time to prepare (optional).
Designate your Tennessee registered agent.
Decide your management structure before you open the form.
Download the current version of Form Online (sos.tn.gov) from the Tennessee Secretary of State website.
Complete Form Online (sos.tn.gov) carefully.
Submit Form Online (sos.tn.gov) and pay the $300 filing fee.
Wait for your Articles of Organization to be approved.
Receive and store your stamped Articles of Organization.
Draft your operating agreement.
File your initial Annual Report (Online (sos.tn.gov)) within April 1 of the year following formation, then annually on April 1.
Apply for your federal EIN with the IRS.
Open a dedicated business bank account.
Register for Tennessee state taxes.
Pay your Tennessee annual state taxes and fees by the correct deadlines.
Set annual compliance reminders for every year going forward.
- Annual Report: $300, due April 1 each year at sos.tn.gov — $25/month late fee if missed
- No Tennessee personal income tax on wages or salary
- Tennessee franchise and excise tax (0.25% net-worth franchise tax, $100 minimum, plus 6.5% excise tax): may apply to your LLC — verify with TN Department of Revenue
- Tennessee sales tax certificate: required if selling taxable goods or services in Tennessee
- DBA registration: filed at the county register of deeds level if operating under an assumed name
If LLC Attorney Does It for You
Submit your information
Name, management structure, registered agent preference, and target formation date. No forms to find or download.
We handle everything
LLC Attorney files your Articles of Organization, drafts your operating agreement, handles your EIN application, and covers same-day filing if needed.
Receive your documents
Approved Articles of Organization, EIN confirmation, and operating agreement through your client portal. Annual compliance reminders included.
What You Actually Get When You Form Your Tennessee LLC with LLC Attorney
A $0 filing offer is never really free in Tennessee. Before any service markup, Tennessee itself charges $300 at formation for the Articles of Organization, due at the time of filing. Once you add a Tennessee registered agent, an operating agreement, and the EIN that nearly every LLC needs, an advertised free price typically lands in the $400 to $675 range.
Included with LLC Attorney formation:
- Same-day or 24-hour Tennessee filing at no markup on the state fee. Most services charge extra to expedite.
- An attorney-drafted operating agreement, customized, not an auto-generated template.
- Access to attorney-trained Business Success Advisors at no charge, to guide entity and structure decisions.
- Optional flat-fee attorney consultations (no retainer) when your situation needs a licensed attorney.
- One account to manage ongoing Tennessee compliance: annual report filing and mail scanning.
When you form with LLC Attorney, you avoid the risk of missing Tennessee's April 1 Annual Report deadline, a mistake that triggers a $25 per month late fee and can spiral into administrative dissolution.
Starting Your Tennessee LLC with LLC Attorney
Tennessee LLC formation requires upfront budgeting for the $300 filing fee and $300 Annual Report due every April 1, plus Tennessee's franchise and excise tax (0.25% net-worth franchise tax with a $100 minimum, and 6.5% excise tax), which SB 2103 (2024) left in force after repealing only the franchise tax's property measure. There is no personal income tax on wages. The most common compliance error is missing the April 1 Annual Report deadline and incurring the $25/month late fee. LLC Attorney handles Tennessee LLC formation and registered agent service starting at $49.
LLC Attorney handles Tennessee LLC formation starting at $49. Same-day filing is available at no markup on state fees. On-demand, flat-fee attorney consultations in 30-minute increments — no retainer — cover operating agreement drafting, entity type questions, and state tax planning. Everything you need for Tennessee, without a traditional law firm retainer. See our full pricing for all service tiers.
Frequently Asked Questions
Online filings at sos.tn.gov typically process within 1–2 business days. Mail filings can take 2–4 weeks or longer during peak periods. Tennessee does not offer a formal expedited processing tier for online filings — online filing is the fastest available option.
Tennessee has no personal income tax on wages or salary. Tennessee's franchise and excise tax remains in force, however: SB 2103 (2024) repealed only the franchise tax's property measure, leaving the net-worth franchise tax (0.25% of net worth, $100 minimum) and the 6.5% excise tax in place, and Tennessee treats many federally disregarded LLCs as separate taxpayers — confirm your status with the TN Department of Revenue. Your LLC must also file an Annual Report ($300) by April 1 each year. Note that the $300 formation fee and $300 Annual Report make Tennessee one of the most expensive states for ongoing LLC costs.
Single-member Tennessee LLCs owe the same $300 Annual Report fee as multi-member LLCs. As a disregarded entity federally, income flows to the sole member's federal return. Tennessee does not impose a personal income tax on this pass-through income, but the state treats many federally disregarded LLCs as separate taxpayers for its franchise and excise tax — confirm whether your LLC owes the 0.25% net-worth franchise tax ($100 minimum) and 6.5% excise tax with the TN Department of Revenue.
Tennessee has a statewide business license requirement administered by the TN Department of Revenue — most businesses with $10,000 or more in annual sales must obtain a Tennessee standard business license. Local jurisdictions also require their own licenses in many cities and counties. Certain industries require additional state-level licenses. Check both state and local requirements before opening.
A Tennessee LLC can hire employees. You will need an EIN from the IRS, register with TN Department of Labor and Workforce Development for payroll taxes, and comply with Tennessee employment law requirements. LLC Attorney's formation packages include EIN filing.
To change your Tennessee LLC name, file an Amendment with the Tennessee Secretary of State online at sos.tn.gov. The filing fee is $20. If you operate under an assumed name registered at the county level, update that registration separately with the appropriate county register of deeds. The form is Online (sos.tn.gov) and the fee is $20.
To dissolve a Tennessee LLC, file Articles of Dissolution online at sos.tn.gov. Close all Tennessee tax accounts with the Department of Revenue, including any excise tax accounts, and file all outstanding Annual Reports. The Secretary of State will issue a Certificate of Dissolution upon approval.
Missing the April 1 Annual Report deadline triggers a $25/month late fee, which accumulates until the report is filed. Continued delinquency can result in administrative dissolution of the LLC. Reinstatement requires filing all outstanding reports, paying accumulated fees and penalties, and submitting reinstatement documents to the Secretary of State.
If the Tennessee Secretary of State cannot deliver legal notices to your registered agent, the state can administratively dissolve your LLC without additional warning. A professional registered agent service ensures a qualified person is available at a physical Tennessee address during business hours to receive any legal documents on your behalf.
Tennessee does not legally require an LLC operating agreement, but it is strongly recommended. Given Tennessee's unique excise tax structure and high annual compliance costs ($300 Annual Report), a well-drafted operating agreement can help define member roles, clarify tax elections, and protect the LLC's liability shield. Banks also require a written operating agreement to open a business account.