Amazon LLC Cost in 2026: What Sellers Should Expect to Pay

Starting an LLC for your Amazon business in 2026 typically costs between $100 and $1,500, depending on your state, setup method, and the services you choose. On average, U.S. sellers pay around $130 in state filing fees and about $224 total in the first year, including basic annual costs.

The biggest upfront expenses include state filing fees, registered agent services, and optional support from formation providers, including Amazon LLC registration services or legal professionals who help simplify the setup process. After setup, you’ll also need to budget for ongoing costs such as annual reports or franchise taxes to keep your LLC active and compliant.

Key Takeaways:

• State filing fees range from $35 to $500, depending on where you register your LLC
• The average LLC cost in the U.S. is ~$224 for the first year, including filing and basic annual fees
• Ongoing yearly costs range from $0 to $800+, depending on state taxes and compliance requirements
• Amazon does not require an LLC, but many sellers choose one for better structure and scalability
• An LLC offers liability protection when properly maintained, meaning you must keep business and personal finances separate and stay compliant
• You can form an LLC yourself or use a service provider, depending on your budget and preference
• Amazon seller fees (subscription, FBA, referral fees) are separate from LLC costs
• Forming in your home state is usually the most cost-effective and simplest option

Many new Amazon sellers face the same challenge: the real cost of forming and maintaining an LLC isn’t clearly explained. You’ll see numbers online, but rarely a clear breakdown of what’s required, what’s optional, and what it actually costs long term.

That confusion leads to delays, unnecessary expenses, or worse, skipping the LLC entirely and putting personal assets at risk.

This guide fixes that. You’ll get a clear breakdown of Amazon LLC costs in 2026, the factors that impact pricing, and how to choose the right setup for your business goals without getting lost in legal complexity.

At StarterX, we’ve helped launch and scale Amazon businesses across multiple states, handling everything from LLC formation to compliance. As a full-service Amazon agency, we work closely with sellers on both the legal setup and the operational side of building a successful store. This guide is based on real-world experience

Disclaimer: We are not legal or tax professionals. This content is for informational purposes only, and you should consult a qualified attorney or tax advisor for advice specific to your situation.

Let’s get into the details.

What Is an Amazon LLC, and Why Do Sellers Use It?

An Amazon LLC is a limited liability company created by sellers who want to separate their personal assets from their business activities on Amazon. It is a legal structure that protects the owner from being personally responsible for business debts or legal issues.

Amazon does not require you to have an LLC, but many sellers choose it to reduce risk, improve professionalism, and gain more control over taxes. As sellers move forward, they also start focusing on the Amazon LLC setup process to make sure their business is structured properly from the beginning and aligned with their long-term goals.

Why Do Sellers Prefer LLCs Over Sole Proprietorships?

Most first-time Amazon sellers start as sole proprietors, but they often switch to LLCs for better protection and flexibility. Here’s why:

• Limited liability protection: Your personal savings, car, or house are shielded from business lawsuits or debts
• Business credibility: Suppliers and customers are more likely to trust a registered business
• Easier tax options: You can choose to be taxed as a sole proprietor, a partnership, or even an S corporation
• Separation of finances: You can open a dedicated business bank account and keep income organized
• Ownership flexibility: LLCs can have one owner or several, and ownership can be split however you choose

The key legal entities related to Amazon sellers include LLC, sole proprietorship, corporation, and foreign entity (for international sellers).

Amazon Seller Central accepts both personal and business tax IDs. Sellers using an LLC typically provide an EIN (Employer Identification Number) from the IRS instead of a Social Security Number.

If you want to build a long-term brand or expand your product lines, forming an LLC is often a smart first step.

How Much Does It Cost to Form an Amazon LLC in the U.S.?

The cost to form an Amazon LLC in the United States ranges from $100 to $1,500, depending on your state and whether you file on your own or use a service.

The main cost components include:

1. State Filing Fee

This is the official fee paid to your state’s business filing office to create your LLC.

State	Filing Fee (USD)
California	$70
Texas	$300
Florida	$125
Delaware	$90-$110
Wyoming	$100

Source: Respective Secretary of State websites, 2026 updates

2. Registered Agent Service

Every LLC must list a registered agent who can receive legal documents. You can act as your own agent, but many sellers use a service for privacy and compliance.

• Average cost: $100 to $300 per year

3. Operating Agreement (Optional but Recommended)

An operating agreement outlines how your LLC is managed. Some states require it, and many banks ask for it when opening a business account.

• Cost: Free (DIY template) to $200 if written by a lawyer
  

4. EIN (Employer Identification Number)

You need an EIN to file taxes or open a bank account. The IRS provides it for free if you apply directly.

• Cost: $0 through the IRS website

Some third-party sites charge $50 to $150 for applying on your behalf, but this is optional.

5. LLC Formation Services (Optional)

Companies like StarterX, LegalZoom, ZenBusiness, and Incfile can handle the paperwork for you. They usually offer packages that include filing, agent services, and legal documents.

• Cost: $0 to $500+ depending on the package and add-ons

Summary of One-Time Formation Costs

Cost Type	Typical Range
State Filing Fee	$40 to $500
Registered Agent	$100 to $300 yearly
Operating Agreement	$0 to $200
EIN	$0 (if done yourself)
LLC Service Provider	$0 to $500+

The total upfront cost will depend on your choices. Forming your LLC on your own in a low-cost state could cost as little as $100, while using a service in a high-cost state could bring the total closer to $1,000 or more.

What Are the Ongoing LLC Costs for Amazon Sellers?

Running an Amazon LLC comes with annual costs that vary depending on your business location. After forming the LLC, you’ll need to keep it active by paying state fees, filing required documents, and covering basic business maintenance costs. Along with these expenses, sellers also need to stay on top of Amazon seller tax requirements, which can impact how they manage reporting, compliance, and overall business finances.

These costs are important for staying legally compliant and avoiding penalties.

Common Ongoing LLC Expenses:

Expense Type	Cost Range (USD)	Description
Annual Report Fee	$0 to $500	Required in most states to keep your LLC in good standing
Franchise Tax	$0 to $800+	Charged by states like California, Delaware, and Texas
Registered Agent Renewal	$100 to $300 per year	Needed if you use a third-party service
Business License Renewal	$0 to $100+	Some cities require local permits or licenses
CPA or Tax Filing Fees	$200 to $2,000+	Optional and varies by business size, but recommended for accurate filings

1. Annual Report Fees

Most states require LLCs to file an annual or biennial report to confirm their business address, members, and registered agent.

• Example:
  • Florida: $138.75 annually
  • Texas: No fee, but a Public Information Report must be filed
  • New York: No fee, but the Biennial Statement must be submitted

2. Franchise Tax

Some states charge a minimum franchise tax, even if your Amazon store earns no profit.

• California: $800 per year minimum
• Delaware: $300 flat annual fee
• Texas: No franchise tax if revenue is under $2.47 million (2026 threshold)

3. Registered Agent Renewal

If you hired a company to act as your registered agent, you’ll need to renew that service each year. This keeps your business legally reachable for state and legal documents.

• Most agent services charge $100 to $300 per year

4. Local Business Licenses

Some cities or counties require Amazon sellers to hold a local business license or pay a renewal fee. These vary widely.

• Example:
  • Los Angeles: $26 annual renewal for online retail businesses
  • Houston: Varies by gross receipts

5. Accounting or Filing Fees

Hiring a tax professional isn’t required, but it’s often a smart investment, especially if your Amazon store earns over $50,000 per year.

• Basic tax filing with an accountant: $300 to $500
• Ongoing bookkeeping: $100+ monthly

If you skip these annual costs, your LLC could be suspended, which can block your access to banking, Amazon Seller Central updates, and legal protections.

What Are the Amazon-Specific Costs Tied to an LLC Business Model?

Forming an LLC does not change Amazon’s platform fees, but it gives you a more professional way to manage your business finances. As an LLC, you still pay all standard Amazon seller fees, along with costs related to product fulfillment, shipping, and inventory.

Here’s how Amazon’s selling costs apply when using an LLC.

1. Amazon Seller Account Fees

You can choose between two plans:

• Individual Plan: $0.99 per item sold
• Professional Plan: $39.99 per month

Most LLC sellers use the Professional Plan to unlock tools like bulk listing, API access, and advanced reports.

2. Referral Fees

Amazon charges a referral fee on each sale. This is a percentage of the item’s sale price and varies by category.

Category	Referral Fee
Electronics	8% to 15%
Clothing	17%
Home & Kitchen	15%
Beauty	8% to 15%

• These fees apply the same way whether you sell as an individual or as an LLC

3. Fulfillment Fees (FBA)

If you use Fulfillment by Amazon (FBA), you’ll pay for storing, packing, and shipping your products.

• Example:
  • Standard-size item, under 1 lb: $3.22 per unit Approx
  • Large-size item, over 2 lb: $7 to $15+ per unit

Amazon also charges monthly storage fees and long-term storage penalties if your products sit too long in their warehouses.

4. Inventory and Product Costs

Whether you’re private labeling or reselling, you’ll have inventory expenses:

• Product sourcing
• Packaging
• Shipping from the supplier to Amazon
• Import duties (if international)

LLC formation does not reduce any of these costs, but it may help you get better supplier terms and open business lines of credit.

5. Payment Processing and Banking

As an LLC, you can open a business bank account, which separates your Amazon revenue from personal income. This improves your bookkeeping and helps during tax season.

Amazon will still send payouts on the same schedule, usually every 14 days, directly to your linked bank account.

Best States for LLC Formation by Cost and Value

Not all states offer the same value when it comes to forming an LLC for Amazon selling. Some are low-cost to start but expensive to maintain. Others have higher fees up front but fewer long-term obligations. Choosing the right state can reduce your annual business costs and simplify compliance.

State	Filing Fee	Annual Fees	Franchise Tax	Best For
Wyoming	$100	$60	None	Low-cost setup, non-residents
Delaware	$90	$300	Yes	Legal protection, holding LLCs
Texas	$300	$0	Conditional	Large-volume Amazon sellers
Florida	$125	$138.75	None	U.S.-based sellers, easy setup
California	$70	$800	Yes	Required if operating in CA

Should You Form in Your Home State or Out of State?

If you live in the U.S., forming your LLC in your home state is usually the best option. It avoids extra paperwork and duplicate fees. If you form your LLC in another state like Wyoming or Delaware, but run your business from a different state, you’re legally required to register as a foreign LLC in your home state.

This creates additional costs:

• Dual registration fees
• Two registered agents
• Two annual filings
• Possible state taxes in both states

For most Amazon sellers, these added expenses cancel out any savings from forming out of state. Forming where you live is simpler, cheaper, and keeps your LLC in good standing without complex reporting.

However, if you live in a state with high franchise taxes like California or Illinois, and you don’t have a physical presence there, it may be worth comparing options.

Best States for Non-Residents

If you live outside the U.S. and want to sell on Amazon.com, you can still form a U.S. LLC. Wyoming and Delaware are the most common choices for non-residents in some cases due to their easy filing process and flexible rules.

• Wyoming is preferred for privacy, no state income tax, and low annual fees
• Delaware is used when legal protections and corporate structure matter more
• Both states allow formation without a U.S. address, but a registered agent is required

International sellers must also apply for an EIN and may need to open a U.S. business bank account to receive Amazon payouts. Some banks require proof of a U.S. address, so many non-residents work with specialized banking or formation services that help bridge this gap.

If you’re an international Amazon seller, starting with a Wyoming LLC is often the most cost-effective and practical approach.

Is an LLC Required to Sell on Amazon, and What Does It Cost If You Don’t Use One?

You don’t need an LLC to start selling on Amazon. Many beginners register as sole proprietors, which has no official startup cost. But skipping the LLC comes with trade-offs, especially if you plan to grow your business.

Cost and risk differences without an LLC:

• $0 startup cost: No state filing, EIN optional if using SSN
• No legal protection: Personal assets are exposed to business risks
• Lower trust from suppliers: Some manufacturers prefer working with registered businesses
• Missed tax planning opportunities: LLCs can choose how they are taxed
• No separate banking: Personal and business income mix, which complicates bookkeeping

You can start as a sole proprietor and form an LLC later. When ready, update your Amazon tax identity with your EIN and switch to a business bank account. This shift improves structure without disrupting your Amazon operations.

Final Thoughts on Amazon LLC Costs and Setup

Forming an LLC for your Amazon business is one of the smartest ways to protect your personal assets and build a strong foundation from day one. While costs vary based on your state and setup method, most sellers can expect to invest between $100 and $1,500 to get started.

• Forming an LLC helps structure your business properly and prepares you for long-term growth
• Startup costs typically range from $100 to $1,500, depending on your state and services used
• An LLC provides liability protection when properly maintained, keeping personal and business assets separate
• It offers flexible tax options, allowing you to choose the most suitable structure as your business scales
• Understanding key costs is essential, including state fees, registered agent services, and franchise taxes
• Choosing the right state can reduce ongoing expenses and simplify compliance
• Setting up your Amazon Seller Central account correctly ensures your LLC is properly aligned with your business operations
• An LLC is not just an expense; it is a long-term investment in building a scalable and secure e-commerce brand

The real value of an LLC goes beyond paperwork. It gives you the structure, protection, and flexibility needed to grow your Amazon business with confidence while keeping your finances organized and secure.

Ready to Set Up Your Amazon LLC the Right Way?

Getting your Amazon business off the ground starts with making sure your LLC is formed correctly and your seller account is set up without mistakes. That includes choosing the right state, securing your EIN, adding your legal details to Seller Central, and understanding what costs to expect.

At StarterX, we’re an e-commerce agency that has helped build real Amazon brands from scratch. We know the process, the paperwork, and the small details that save you from big problems later. Whether you’re starting from zero or switching from a personal account to an LLC, our team can walk you through every step.

✅ Avoid delays

✅ Stay compliant

✅ Set up for long-term growth

📞 Book your free consultation call now

---

Frequently Asked Questions About Amazon LLC Costs

Do I need an LLC to sell on Amazon?

No, an LLC is not required to sell on Amazon. You can sell as a sole proprietor, but an LLC gives you personal liability protection, cleaner tax separation, and a more professional setup.

How much does it cost to start an Amazon LLC?

Starting an LLC typically costs between $100 and $1,500, depending on your state, registered agent, and if you use a formation service. State filing fees range from $35 to $500.

Are there ongoing fees for maintaining an Amazon LLC?

Yes. Most states charge annual report fees or franchise taxes. These range from $0 to $800+ per year. You may also pay for registered agent services and accounting help.

What is a registered agent, and do I need one?

A registered agent is someone who receives legal documents for your LLC. You need one in the state where your LLC is formed. You can act as your own if you live there, or hire a service.

Can international sellers form a U.S. LLC?

Yes. Non-U.S. residents can form a U.S. LLC in states like Wyoming or Delaware. You’ll need a registered agent, an EIN, and sometimes help with opening a U.S. business bank account.

What’s the cheapest state to form an Amazon LLC?

Wyoming is often the cheapest overall. It has a $100 filing fee, no state income tax, and a low $60 annual report fee. It’s popular with international sellers and small businesses.

What’s the difference between an LLC and a sole proprietorship?

A sole proprietorship has no legal separation between you and your business. An LLC is a separate legal entity that protects your personal assets and offers more tax options.

Can I switch from sole proprietor to LLC on Amazon?

Yes. You can update your tax info in Amazon Seller Central. After forming your LLC and getting your EIN, go to your account settings and update your legal business name and tax identity.

Do I need a business license in addition to the LLC?

Some cities or counties may require a local business license, even if you sell online. This depends on where you live or operate. Check with your local government office.

/