Alabama LLC filing: $200 to form, no more annual report, and one initial tax return that catches new owners

Every figure on this page comes from the Alabama Secretary of State and the Department of Revenue, not an aggregator, and Alabama’s numbers changed recently in the owner’s favor. As of 2024, Alabama eliminated the LLC annual report and exempted small companies from the business privilege tax, so a small Alabama LLC files nothing yearly once it is set up. That makes Alabama one of the cheaper states to maintain, and, combined with the protected series LLC on the structure and cost page, one of the cheaper places to run a multi-property structure. The one thing that still catches new owners is a filing due right after formation.

Forming the company

Formation is a single filing with the Secretary of State.

Alabama forms an LLC on a Certificate of Formation filed with the Secretary of State for $200.

You create an Alabama LLC by filing the Certificate of Formation with the Secretary of State for a $200 fee, naming the company and a registered agent with an Alabama address. Alabama moved LLC formation to a centralized Secretary of State process, so the filing is done in one place rather than through the county probate court as in years past.

The report that is gone, and the tax that is smaller

Alabama’s recurring obligations shrank in 2024.

Alabama eliminated the LLC annual report in 2024, and a small LLC owing $100 or less in privilege tax files and pays nothing.

For years an Alabama LLC filed an annual business privilege tax return that doubled as its annual report. Two 2024 changes cut that back. Alabama eliminated the separate annual report for LLCs, and it exempted the smallest companies from the business privilege tax: an entity whose calculated privilege tax is $100 or less now owes nothing and files no return. The privilege tax itself is based on the company’s Alabama net worth, so a small holding LLC with modest net worth falls under the exemption, while a larger company still calculates and files it. The result is that a small Alabama LLC has essentially no recurring state filing after formation, which is rare and genuinely reduces the cost of holding property here. There is one filing that does not go away.

A one-time initial business privilege tax return is due within two and a half months of forming the LLC, and new owners miss it.

Even with the recurring return gone for small entities, Alabama requires a new LLC to file an initial business privilege tax return within two and a half months of formation. It is a one-time filing, but the short deadline catches owners who assume the 2024 changes mean no tax filing at all, and missing it can create penalties and jeopardize good standing, which matters because good standing is what the liability shield on the protection page depends on. So the Alabama compliance picture is a $200 formation, an initial return within two and a half months, and then, for a small LLC, nothing yearly.

Multiple entities, and the series advantage

Alabama’s low maintenance cost changes the multi-property math.

Because Alabama has no annual report and exempts small LLCs from the privilege tax, holding several entities, or one protected series, is unusually cheap here.

In most states, each additional LLC means another annual report and another fee, so a multi-property investor pays for the structure every year. Alabama removes the annual report and exempts small entities from the privilege tax, so a structure of several small Alabama LLCs carries almost no recurring state cost. And unlike South Carolina, which is also cheap to maintain but has no series, Alabama offers the protected series described on the structure and cost page, so an investor can hold several properties in one series LLC with walled-off cells and still owe no annual report and no privilege tax if the entity stays small. That makes Alabama one of the least expensive states in the region to run a multi-property holding structure, with the initial return being the main thing to remember for each new entity.

The bottom line

An Alabama LLC forms on a Certificate of Formation filed with the Secretary of State for $200, with an Alabama-address registered agent.

Alabama eliminated the LLC annual report in 2024, and a small LLC owing $100 or less in privilege tax files and pays nothing.

A one-time initial business privilege tax return is due within two and a half months of formation, which is the filing new owners miss.

Because there is no annual report and small entities are exempt from the privilege tax, holding several LLCs or one protected series is unusually cheap in Alabama.

The main thing to track for each new entity is the initial return; after that, a small Alabama LLC has essentially no recurring state filing.

What this page does not cover

This page is about fees, forms, and deadlines. How creditors reach a member’s interest, the elite charging order, and the foreign-LLC condition are on the protection page. The duties the operating agreement can shape, and the 2014 act’s sweep of older LLCs, are on the governance page. Alabama’s 5% income tax, the federal-tax deduction, the protected series LLC, and the business privilege tax are on the structure and cost page.

Last verified August 2026.