Foreign LLC cost calculator (2026)
Form in one state, operate in another? You pay BOTH states: filing in form-state + foreign-LLC registration in operate-state + both states' annual reports + applicable franchise taxes. The "form in Wyoming to save money" advice ignores this. The calculator below shows the actual math for your specific state pair, and compares to forming directly in your operate-state.
Foreign LLC calculator
Pick your states
Form-state = where the LLC is incorporated. Operate-state = where you do business (employees, offices, customers transact in person).
Total cost: Wyoming + California foreign
Cost breakdown
| Component | Wyoming (form-state) | California (foreign) |
|---|---|---|
| Filing / registration fee | $100 | $70 (foreign LLC fee) |
| First-year annual report | $60 | $20 |
| Franchise tax (year 1) | $0 | $800 |
| Ongoing annual fee | $60/yr | $820/yr |
vs forming directly in California
| Strategy | Year 1 | Annual | 5-year total |
|---|---|---|---|
| Form in California directly | $890 | $820 | $4,170 |
| Form in Wyoming, register foreign in California | $1,050 | $880 | $4,570 |
The "foreign LLC" trap, in one paragraph
Most "best state to form an LLC" articles tell you to form in Wyoming or Delaware. They omit a critical piece: if you do business in your home state, your home state requires you to register the out-of-state LLC as a "foreign LLC", paying your home state's filing fee + annual report + franchise tax anyway. You end up paying TWO states. The Wyoming form-state isn't free; it just adds a $100 form-state filing + $60/yr ongoing on top of your home-state's costs.
The trap works because affiliate sites (registered-agent services) profit from out-of-state filings, they need to sell you their registered-agent service in the form-state. They benefit when you form somewhere you don't live, because forming in your home state means you don't need their service.
When does form-state strategy actually save money?
- Asset-holding LLC with no operations. If the LLC owns real estate or financial assets but has no employees/customers/offices anywhere, you only file in the form-state. Wyoming makes sense here.
- Form-state has dramatically lower ongoing fees AND your operate-state is a low-cost state. Example: form in Wyoming, operate in Texas, Wyoming's $60/yr form-state cost adds to Texas's $0/yr operating cost (under threshold), totaling $60/yr. Forming directly in Texas is $0/yr. Wyoming form-state isn't cheaper, but it's not much more expensive either; pick based on privacy/asset-protection criteria, not cost.
- Multiple operate-states with one being the largest. If you operate in 5 states, forming in your largest revenue state and registering as foreign in the other 4 is cheaper than forming in Wyoming and registering as foreign in all 5 (you've replaced one foreign-LLC fee with a domestic filing).
- Specific privacy / asset-protection requirements that justify the extra cost. Wyoming's anonymous LLC formation is genuinely useful for some business owners; the $60/yr form-state cost is the price of admission.
Frequently asked
What is a "foreign LLC"?
A "foreign LLC" is an LLC formed in one state that conducts business in another state. The "foreign" designation isn't about citizenship, it's about state-of-formation vs state-of-operation. Example: form your LLC in Wyoming, but operate from California (employees, office, customers in CA) → you must register the WY LLC as a "foreign LLC" in California.
When am I required to register as a foreign LLC?
States have varying definitions of "doing business," but generally: having employees in the state, owning real property, maintaining an office, or conducting in-person sales triggers foreign-LLC registration. Online-only businesses with no physical presence in a state typically don't need to register there. When in doubt, the state's SOS website usually has a "doing business in [state]" page that lists triggers.
What does foreign-LLC registration cost?
Foreign-LLC fees vary by state. Some states charge the same as their domestic filing fee (e.g., California $70 domestic = $70 foreign). Others charge more (Texas $300 domestic, $750 foreign). Plus you pay both states' annual reports + franchise taxes ongoing. Use the calculator above for your specific state combination.
Why would anyone form out-of-state and pay double?
Three legitimate reasons: (1) Asset protection, Wyoming/Nevada's charging-order protection requires a state-of-formation tie. (2) Privacy, Wyoming allows anonymous LLC formation. (3) VC fundraising, Delaware C-corps are conventional, so DE LLC starting points convert smoothly. For most other founders, forming in your home state is cheaper.
Does forming in Wyoming actually save me money on California taxes?
No. If you operate in California, California requires you to register your Wyoming LLC as a foreign LLC in CA, paying CA's $70 fee + $800/yr franchise tax + CA-specific annual reports. The "WY saves money" pitch only holds if you have ZERO California business operations. The calculator above shows the math.
What's the penalty for not registering as a foreign LLC?
Doing business in a state without foreign-LLC registration is generally illegal. Penalties vary: most states impose back-taxes + interest + a per-month penalty (typically $100-$500/month for the period of non-compliance). California adds the unpaid years' $800 franchise tax retroactively. More importantly: an unregistered foreign LLC cannot SUE in that state's courts (you can be sued, but can't file suit), meaning you can't collect on contracts or evict tenants until you register and cure.
When does forming out-of-state actually save money?
Run your specific state pair in the calculator above. Generally: forming out-of-state saves money only when (a) the form-state has substantially lower ongoing fees than the operate-state, AND (b) you don't operate in a state with high franchise tax. Example: form in Wyoming ($60/yr), operate in Texas ($0 ongoing under threshold), Wyoming form-state strategy can save vs forming directly in TX. But operate-in-California always costs $800/yr regardless of where you form.
What if I operate in multiple states?
You must register as a foreign LLC in EACH state where you do business. The fees compound: form in WY + operate in CA + NY + FL = WY filing + 3 foreign-LLC registrations + 4 annual reports + applicable franchise taxes. For multi-state operations, forming in one of your operate-states (typically the largest revenue state) often wins, eliminate one foreign-LLC line item.
Calculator uses domestic + foreign-LLC fee data from each state's SOS, verified Q2 2026. Foreign LLC fees marked with approximation when state SOS doesn't publish foreign rate explicitly (typically 1.0-1.5× domestic). Confirm with the operate-state's SOS before deciding. Not legal or tax advice.