How to Start an LLC in Tennessee

Tennessee is an attractive state for LLC formation thanks to its lack of state income tax. However, the filing costs are higher than average — the filing fee for Articles of Organization is $300 per member with a minimum of $300, and the annual report also costs $300 per member (minimum $300). The state processes filings in 3-5 business days through the Tennessee Secretary of State’s office.

Follow these steps to start your Tennessee LLC in 2026.

How to Start an LLC in Tennessee (6 Steps)

Step 1: Name Your Tennessee LLC

Your Tennessee LLC name must be distinguishable from any other business entity on file with the Tennessee Secretary of State. The name must include a designator such as “Limited Liability Company,” “LLC,” “L.L.C.,” or similar abbreviation. You can search for available names using the Tennessee business entity search.

If you find an available name and aren’t ready to file immediately, you can reserve it for 4 months by filing a Name Reservation with the Secretary of State for $20. This prevents anyone else from registering the same name while you prepare your formation documents.

Before finalizing your name, check whether the matching domain name is available for your website and whether the name is available on social media platforms. You should also search the USPTO trademark database to make sure your desired name doesn’t infringe on an existing trademark.

Tennessee naming rules:

• Must include “Limited Liability Company,” “LLC,” “L.L.C.,” or similar abbreviation
• Must be distinguishable from other business names on file with the Secretary of State
• Cannot include words that imply the LLC is a bank, insurance company, or government agency without proper licensing
• Cannot contain language suggesting a purpose the LLC is not authorized to pursue

Step 2: Choose a Registered Agent

Tennessee requires every LLC to have a registered agent with a physical street address in Tennessee. The registered agent receives legal documents — including lawsuits, subpoenas, and official state correspondence — on behalf of your LLC. This is a legal requirement, and your LLC cannot be formed without designating a registered agent.

You can serve as your own registered agent (if you have a Tennessee address), appoint a trusted friend or family member, or hire a professional registered agent service. While acting as your own registered agent saves money, it means your personal address becomes public record and you must be available at that address during all normal business hours to accept documents.

Our top recommendation is Northwest Registered Agent ($39/year), which also handles LLC formation for $39 + the $300 state fee. Using a professional service provides privacy, ensures you never miss an important document, and frees you from having to be physically present at a fixed address during business hours.

Step 3: File Your Articles of Organization

To officially create your Tennessee LLC, you need to file Articles of Organization with the Tennessee Secretary of State. The fastest way to file is online through the Secretary of State’s online filing system. You can also file by mail, but online filing is recommended for faster processing.

The filing fee is $300 per member, with a minimum of $300. For a single-member LLC, the fee is $300. For a two-member LLC, the fee is $600, and so on. This per-member fee structure makes Tennessee more expensive than most states for multi-member LLCs.

When completing the Articles of Organization, you’ll need to choose between a member-managed and manager-managed structure. In a member-managed LLC, all owners participate in running the business. In a manager-managed LLC, one or more designated managers handle day-to-day operations while other members are passive investors. Most small LLCs choose member-managed.

Filing details:

• Filing fee: $300 per member (minimum $300)
• Online filing: Tennessee Secretary of State (recommended)
• Processing time: 3-5 business days (standard)

Information required:

• LLC name
• Registered agent name and address
• Principal office address
• Management structure (member-managed or manager-managed)
• Number of members
• Duration of the LLC (typically perpetual)
• Organizer name and address

Step 4: Create an Operating Agreement

Tennessee does not legally require an operating agreement, but having one is strongly recommended for every LLC, whether single-member or multi-member. An operating agreement is an internal document that establishes the rules for how your LLC is run, including ownership percentages, profit and loss distribution, voting rights, and what happens if a member wants to leave or if the LLC is dissolved.

Without an operating agreement, your LLC will be governed by the default rules in the Tennessee Revised Limited Liability Company Act, which may not align with your intentions. For example, the default rules assume profits are split equally among members regardless of their capital contributions. An operating agreement lets you customize these terms. Most banks and financial institutions also require a copy of your operating agreement before they will open a business bank account.

Step 5: Get an EIN

Apply for an Employer Identification Number (EIN) through the IRS website. It’s free and takes about 15 minutes online. An EIN is a nine-digit number assigned by the IRS that acts as your LLC’s tax identification number — think of it as a Social Security Number for your business. You need an EIN to open a business bank account, hire employees, file federal taxes, and apply for business permits. Even single-member LLCs with no employees should get an EIN, as it helps keep your personal Social Security Number off business documents.

Step 6: File Your Tennessee Annual Report

All Tennessee LLCs must file an annual report with the Secretary of State. The filing fee is $300 per member, with a minimum of $300 — the same per-member fee structure as the initial filing. The annual report is due by the first day of the fourth month following the end of your LLC’s fiscal year. For most LLCs using a calendar year, this means the annual report is due by April 1 each year.

File your annual report through the Secretary of State’s online system. This report updates the state on your LLC’s registered agent, principal office address, and member or manager information. Failure to file can result in administrative dissolution of your LLC. Tennessee does not have a state income tax on wages or business income, which offsets the higher filing and annual report costs.

Tennessee LLC Costs

Total first-year cost: $600-$900 (for a single-member LLC). This range covers the required state filing fee ($300) plus the annual report ($300) and an optional registered agent service. Multi-member LLCs will pay more due to the per-member fee structure. See our complete guide to LLC costs by state.

Tennessee LLC Taxes

Tennessee has no state income tax on wages or business income, which is a major advantage for LLC owners. LLC profits passed through to members are not subject to state income tax. Tennessee previously had the Hall Income Tax on interest and dividend income, but this tax was fully phased out in 2021. As a result, Tennessee is now one of the most tax-friendly states for LLC owners.

Tennessee does impose a franchise and excise tax on LLCs. The excise tax is 6.5% of net earnings, and the franchise tax is 0.25% of the greater of the LLC’s net worth or the book value of real or tangible personal property owned or used in Tennessee, with a minimum of $100. However, single-member LLCs that are disregarded entities for federal tax purposes are generally exempt from the franchise and excise tax.

Tennessee has a state sales tax rate of 7%, with local jurisdictions adding up to 2.75%, for a combined maximum rate of 9.75%. Tennessee has one of the highest combined sales tax rates in the country. If your LLC sells taxable goods or services, you’ll need to collect and remit sales tax. You can register through the Tennessee Department of Revenue.

Remember that all LLC members still owe federal income tax and self-employment tax (15.3%) on their share of LLC profits, regardless of the state’s favorable tax treatment.

Tennessee LLC Annual Requirements

Every Tennessee LLC must file an annual report with the Secretary of State. The filing fee is $300 per member (minimum $300), due by the first day of the fourth month after the end of your fiscal year (April 1 for calendar-year LLCs). File online through the Secretary of State’s website for the fastest processing.

In addition to the annual report, you should keep your registered agent information current with the Secretary of State and file an amendment if your LLC’s name, registered agent, or other key information changes. Maintain accurate internal records, including your operating agreement, meeting minutes, and financial statements. If your LLC is subject to the franchise and excise tax, you must file those returns with the Department of Revenue.

If you want to confirm that your LLC is in good standing, you can request a Certificate of Existence from the Secretary of State for $20. This document is sometimes needed when applying for business loans, opening bank accounts in other states, or registering your LLC as a foreign entity in another state.

Best LLC Formation Services for Tennessee

Start an LLC in Another State

Frequently Asked Questions

How much does it cost to start an LLC in Tennessee?

The state filing fee for a Tennessee LLC is $300 per member, with a minimum of $300. For a single-member LLC, the total filing fee is $300. The annual report also costs $300 per member. Most single-member LLC owners spend between $600 and $900 in their first year, including an optional registered agent service. Multi-member LLCs will pay more due to the per-member fee structure.

How long does it take to form an LLC in Tennessee?

Standard processing takes 3-5 business days when filed online through the Secretary of State’s website. Expedited processing is available for an additional fee. Filing by mail takes longer, often 2-3 weeks.

Do I need a registered agent in Tennessee?

Yes, every Tennessee LLC is required by law to have a registered agent with a physical street address in Tennessee. The registered agent accepts legal documents, including lawsuits and official state mail, on behalf of your LLC during normal business hours. A P.O. box cannot be used as a registered agent address.

Does Tennessee require an operating agreement?

No, Tennessee does not legally require an operating agreement. However, creating one is strongly recommended because it defines member roles, profit sharing, voting procedures, and decision-making processes. Without one, your LLC is governed by the default rules in the Tennessee Revised Limited Liability Company Act.

How are LLCs taxed in Tennessee?

Tennessee has no state income tax on wages or business income, so LLC profits passed through to members are not subject to state income tax. However, Tennessee does impose a franchise and excise tax on certain LLCs — the excise tax is 6.5% of net earnings and the franchise tax is 0.25% of net worth (minimum $100). Single-member disregarded entity LLCs are generally exempt. Members still owe federal income tax and self-employment tax (15.3%).

Why does Tennessee charge per member?

Tennessee’s filing fee and annual report fee are both calculated at $300 per member, with a minimum of $300. This means a single-member LLC pays $300, a two-member LLC pays $600, and so on. This per-member structure makes Tennessee more expensive than most states for multi-member LLCs, though the absence of state income tax helps offset these costs.

Can I be my own registered agent in Tennessee?

Yes, you can serve as your own registered agent in Tennessee as long as you have a physical street address in the state (not a P.O. box) and are available at that address during normal business hours to accept legal documents. Your address will become part of the public record. Many LLC owners prefer using a professional registered agent service for privacy and convenience.

When is the Tennessee LLC annual report due?

The Tennessee LLC annual report is due by the first day of the fourth month following the end of your LLC’s fiscal year. For LLCs using a calendar year (January-December), the annual report is due by April 1. The fee is $300 per member (minimum $300). File online through the Secretary of State’s website.

Can a non-resident form an LLC in Tennessee?

Yes, you do not need to be a Tennessee resident or a U.S. citizen to form an LLC in Tennessee. However, you will need a registered agent with a physical address in Tennessee. Many non-residents use a professional registered agent service for this purpose. If you conduct business in another state where you live, you may also need to register your Tennessee LLC as a foreign LLC in that state.