Does Indiana have a franchise tax for LLCs?

No, Indiana does not impose a franchise tax on LLCs. This is one of the reasons Indiana is considered one of the most affordable states for LLC formation. Your only recurring state fee is the $32 biennial report every two years.

How often do Indiana LLCs need to file reports?

Indiana LLCs file biennial (every two years) reports, not annual reports. The report is due during the anniversary month of your LLC's formation. This means you only pay $32 every two years instead of $200+ annually like in many other states.

What is the total cost to form an LLC in Indiana?

The total state cost to form an Indiana LLC is $95 for the Articles of Organization filing. If you act as your own registered agent and file online yourself, this is your only required expense. Additional optional costs include registered agent services ($50-$300/year) and expedited processing ($50).

When is the Indiana biennial report due?

The biennial report is due during your LLC's anniversary month, every two years. For example, if your LLC was formed in March 2024, your first biennial report would be due in March 2026, then March 2028, and so on.

How are Indiana LLCs taxed?

Indiana LLCs are taxed as pass-through entities by default. The LLC doesn't pay state income tax directly. Instead, profits pass through to members who pay Indiana's flat 4.9% individual income tax on their share. LLCs can elect C-corp or S-corp taxation if preferred.

Is Indiana a good state to form an LLC?

Yes, Indiana is excellent for LLC formation due to its low costs ($95 formation, $32 biennial report), no franchise tax, fast processing (1-2 days online), and straightforward compliance requirements. It's particularly attractive compared to high-cost states like California or New York.

Indiana LLC Taxes & Fees 2026: Complete Cost Breakdown

Item	Cost/Details	Notes
LLC Formation Filing Fee	$95	One-time fee at formation
Biennial Report Fee	$32	Due every 2 years
Foreign LLC Registration	$95	For out-of-state LLCs
Certificate of Existence	$20	Proof of good standing
Name Reservation	$20	Valid for 120 days
Registered Agent Change	$30	If updating registered agent
Articles of Amendment	$30	To change LLC details
Expedited Processing	$50	Same-day processing

Indiana LLC Formation Costs

Indiana offers one of the lowest LLC formation fees in the United States at just $95. This makes it an attractive option for entrepreneurs who want to minimize startup costs.

State Filing Fee

The $95 fee covers filing your Articles of Organization with the Indiana Secretary of State. This is a one-time fee paid when you initially form your LLC.

Processing Time

Online filing: 1-2 business days (standard)
Expedited online: Same-day processing (+$50)
Mail filing: 5-7 business days

Total First-Year Costs

Here's what a typical Indiana LLC costs in year one:

Item	Cost
Articles of Organization	$95
Registered Agent (if using yourself)	$0
EIN from IRS	$0
Minimum Year 1 Total	$95

Cost Comparison: Indiana's $95 formation fee compares favorably to California ($70 + $800 franchise tax), New York ($200 + $500-$2,000 publication), and Texas ($300).

Biennial Report Requirements

One of Indiana's best features is the biennial report—you only file every two years, not annually. This halves your ongoing compliance burden.

Biennial Report Details

Fee: $32
Frequency: Every 2 years
Due date: During your LLC's anniversary month
Filing method: Online through INBiz portal

What the Report Includes

The biennial report updates the state on your LLC's:

Principal office address
Registered agent information
Members/managers (if applicable)
Nature of business

Late Filing Consequences

If you miss your biennial report deadline:

Your LLC becomes "Delinquent" after 60 days
There's no additional late fee (unlike many states)
Continued non-filing may lead to administrative dissolution

Tip: Indiana doesn't charge late fees for overdue biennial reports, but your LLC status will show as "Delinquent" in public records, which can affect business relationships and banking.

Indiana State Taxes for LLCs

No Franchise Tax

Indiana does not impose a franchise tax on LLCs. This is a significant advantage compared to states like:

California: $800 minimum annual franchise tax
Texas: Franchise tax based on revenue
Tennessee: Franchise and excise taxes
Indiana: $0 franchise tax

Pass-Through Taxation

By default, Indiana LLCs are treated as pass-through entities:

The LLC itself doesn't pay Indiana income tax
Profits "pass through" to members' personal returns
Members pay the flat 4.9% Indiana income tax on their share
Some counties impose additional income tax (0.5%-3.38%)

Sales Tax

If your LLC sells taxable goods or services in Indiana:

Indiana sales tax rate: 7% (statewide)
Must register for sales tax permit
File and remit sales tax regularly (monthly, quarterly, or annually based on volume)

Employment Taxes

If your LLC has employees in Indiana:

Withhold state income tax from wages
Pay unemployment insurance (UI) tax
Workers' compensation insurance may be required

Federal Tax Obligations

Your Indiana LLC also has federal tax requirements based on how it's classified:

Single-Member LLC

Treated as "disregarded entity" by IRS
Report income on Schedule C (Form 1040)
Pay self-employment tax (15.3%)
Make quarterly estimated tax payments

Multi-Member LLC

Treated as partnership by IRS
File Form 1065 annually
Issue Schedule K-1 to each member
Members report their share on personal returns

Corporate Tax Election

LLCs can elect S-corp or C-corp taxation. S-corp election can reduce self-employment taxes for profitable LLCs paying members reasonable salaries.

Total Annual Cost Comparison

Here's how Indiana compares to other states for ongoing LLC costs:

State	Annual Report	Franchise Tax	Annual Total
Indiana	$16/year*	$0	$16/year
North Carolina	$200/year	$0	$200/year
California	$20/2 years	$800 min	$810/year
New York	$9/2 years	$25-$4,500	$30-$4,500+/year

*Indiana's $32 biennial report divided by 2 years = $16/year effective cost

Bottom Line: An Indiana LLC can cost as little as $16 per year in state fees (averaged), making it one of the cheapest states to maintain an LLC.

Cost-Saving Tips for Indiana LLCs

1. Be Your Own Registered Agent

If you have an Indiana address and are available during business hours, act as your own registered agent to save $50-$300/year.

2. File Online

Online filing through INBiz is faster and ensures accurate processing. Avoid paper filing delays.

3. Get Your EIN Free from IRS

Never pay a service for an EIN. Get one free at irs.gov in minutes.

4. Set Biennial Report Reminders

Since reports are every two years, it's easy to forget. Set calendar reminders for 30, 14, and 7 days before your anniversary month.

5. Skip Expedited Processing

Standard online processing (1-2 days) is usually fast enough. Save the $50 expedited fee unless you have an urgent deadline.

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