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Posted on • Originally published at llcformationcost.com

Form an LLC in Arkansas: Total Cost & Filing Steps (2026)

#llc #cost #arkansas

Arkansas LLC Cost: $45 Filing + $150 Annual Franchise Tax (2026)

Forming an LLC in Arkansas costs $45 to file Articles of Organization online ($50 by mail) with the Secretary of State, then $150 every year for the Annual LLC Franchise Tax Report. Year-one cost: $45 in formation year (the franchise tax begins May 1 of the year after formation). Five-year cost of ownership: $795. Arkansas pairs one of the cheapest filing fees in the country ($45) with a flat $150 annual franchise tax that hits every LLC regardless of revenue, a structural quirk that makes Arkansas cheap to open but moderately expensive to keep open.

Reviewed by LLC Formation Cost Editorial Team, fact-checked against primary government sources • Last updated 2026-05-14 • 5 primary government sources cited

TL;DR

Arkansas LLCs file Articles of Organization with the Arkansas Secretary of State for $45 online or $50 by mail. The ongoing cost is the Annual LLC Franchise Tax Report, a flat $150 paid each year by May 1 to the Secretary of State (Arkansas runs franchise tax through SOS, not the Department of Finance and Administration). The franchise tax is a privilege tax: it applies whether the LLC made $1 or $1 million. There is no separate annual report fee; the franchise tax filing is the annual report. Arkansas processes online filings within 3 business days standard, with no separately priced expedite tier. A quirk worth knowing upfront: Arkansas LLC names cannot contain the word "Arkansas" or any abbreviation of the state name, a rule unique to Arkansas.

Arkansas LLC cost breakdown (2026)

Line item Cost Source
Articles of Organization (online) $45 sos.arkansas.gov
Articles of Organization (by mail) $50 sos.arkansas.gov
Annual LLC Franchise Tax Report $150/yr sos.arkansas.gov
Registered Agent service (Arkansas-resident required) $50-$200/yr n/a
Year 1 total (DIY, no add-ons) $45
Year 2+ ongoing (DIY no RA) $150
5-year total (DIY) $795 ($45 + $150 × 5)

All figures verified 2026-05-14 from primary Arkansas state sources.

Why Arkansas costs more than it looks

The $45 filing fee is misleading. It's one of the lowest formation fees in the country, on par with Kentucky ($40) and New Mexico ($50). What makes Arkansas more expensive over time is the flat $150 annual franchise tax that begins the year after formation:

  • Year 1: $45 (filing only, no franchise tax due yet for entities formed during the year, the first franchise tax is due May 1 of the following year)
  • Year 2-5: $150/yr each year
  • 5-year total: $795

For comparison, Wyoming's 5-year baseline is $340, New Mexico's is $50, and Florida's is $681. Arkansas sits in the middle: cheaper to open than most states, but the $150 flat franchise tax means it isn't a "no ongoing cost" state.

The $150 is a privilege tax, not a tax on income. Ark. Code § 26-54-104 imposes the LLC franchise tax as a flat amount regardless of profit or activity. An Arkansas LLC with $0 revenue still owes $150 by May 1 each year after formation. The Arkansas Secretary of State (not the Department of Finance and Administration) administers the LLC franchise tax, which is unusual; most states put franchise tax with the revenue department.

Filing steps (DIY, no service)

  1. Pick a name, search availability at the Arkansas SOS business entity search. Names must include "Limited Liability Company," "LLC," or "L.L.C." and cannot contain "Arkansas" or abbreviations of the state name.
  2. Designate a registered agent, must have an Arkansas street address. You can act as your own agent if you live in Arkansas.
  3. File Articles of Organization, $45 online or $50 by mail to Arkansas Secretary of State, 1401 W. Capitol Avenue, Suite 250, Little Rock, AR 72201.
  4. Get a federal EIN, free at irs.gov.
  5. Draft an operating agreement, not required by Arkansas statute but standard practice. Banks routinely ask to see one.
  6. Register with the Arkansas DFA, for sales tax (6.5% state + local), withholding tax if hiring, and other state-level obligations. Online via the Arkansas Taxpayer Access Point (ATAP).
  7. Open a business bank account, Arkansas-licensed banks (Arvest Bank, Bank of the Ozarks, Centennial Bank, regional credit unions) are easiest.
  8. File the FinCEN BOI report, required under the Corporate Transparency Act within 30 days of formation. Free to self-file at fincen.gov/boi.
  9. Calendar the franchise tax, due May 1 of the year following formation, $150 flat. File through the SOS franchise tax portal.
  10. Maintain registered agent service, annual renewal of Arkansas RA if you used a service.

Online filings via the SOS portal are processed within 3 business days. There is no published expedite fee.

Page-unique facts

  • Arkansas LLC names cannot include "Arkansas" or any abbreviation of the state name. This is a rule unique to Arkansas, codified in Ark. Code § 4-32-103. The reason is to prevent confusion with state agencies. "AR Holdings LLC" is fine; "Arkansas Holdings LLC" is not.
  • The annual franchise tax is filed with the Secretary of State, not the Department of Finance and Administration. Most states put franchise tax under the revenue department. Arkansas keeps it with SOS.
  • The franchise tax is $150 whether you made $0 or $10 million. It's a flat privilege tax, not a percentage.
  • The first franchise tax is due May 1 of the year after formation. An LLC formed October 2026 owes its first $150 on May 1, 2027.
  • Late franchise tax payment compounds. $25 penalty plus 10% interest annually. Two years late and your LLC is at risk of administrative dissolution.

FAQ

Why can't I use "Arkansas" in my LLC name?

Ark. Code § 4-32-103 prohibits LLC names from containing "Arkansas" or any abbreviation of the state name (AR, Ark., Arkansas, etc.). The intent is to prevent the public from confusing private LLCs with state agencies. The rule is enforced strictly at the SOS portal: a name like "Arkansas Cleaning LLC" will be rejected; "Razorback Cleaning LLC" is fine. Source: Arkansas Code § 4-32-103, via sos.arkansas.gov, verified 2026-05-14.

Is the $150 Arkansas franchise tax mandatory if my LLC made nothing?

Yes. The Arkansas LLC franchise tax is a flat $150 privilege tax that applies regardless of revenue, profit, or activity. Even an LLC that filed Articles in 2026 but did nothing all year owes $150 by May 1, 2027. The only way to stop the franchise tax obligation is to formally dissolve the LLC with the Secretary of State. Source: Ark. Code § 26-54-104, verified 2026-05-14.

When is the Arkansas LLC franchise tax due?

May 1 of each year, starting the year after formation. For an LLC formed at any point in 2026, the first franchise tax payment is due May 1, 2027. Late payments incur a $25 penalty plus 10% interest. Two years late and the SOS can administratively dissolve the LLC. Source: Arkansas Secretary of State Franchise Tax.

How long does Arkansas LLC formation take?

Online filings via the SOS portal: 3 business days standard. Mail filings: 7-10 business days. There is no separately priced expedite tier; the standard processing is already fast for online submissions. Source: Arkansas Secretary of State BCS, verified 2026-05-14.

Does Arkansas require an annual report separate from the franchise tax?

No. Arkansas folds the annual report and the franchise tax into a single filing called the "Annual LLC Franchise Tax Report," filed with the Secretary of State by May 1 each year. The $150 fee covers both the franchise tax obligation and the annual update of LLC information (registered agent, principal address). Source: Arkansas Secretary of State.

Does Arkansas have a state income tax on LLC profits?

Yes, indirectly. Arkansas has a graduated personal income tax that ranges from 2% to 4.4% for tax year 2026, and LLC pass-through profits flow to the members' personal Arkansas returns. The LLC itself doesn't pay income tax (unless it elects C-corp status). Arkansas's corporate income tax for LLCs taxed as C-corps tops out at 4.3%. Source: Arkansas Department of Finance and Administration.

State quirk: the state-name prohibition

Arkansas is the only US state that flatly prohibits using the state's name (or any abbreviation of it) inside a private LLC's name. Ark. Code § 4-32-103 reads, in part, that an LLC name "shall not contain the word 'Arkansas' or any abbreviation thereof." The rule traces back to mid-twentieth century corporate codes that conflated private use of the state name with implied governmental authority, similar in spirit to federal rules barring private companies from calling themselves "FBI Services" or "Treasury Group." In practice, the rule means founders have to find a workaround: Razorback (the University of Arkansas mascot), Ozark (the regional geography), Natural State (the state slogan), or Diamond State (the official nickname) are all common substitutes. The Arkansas SOS does not waive the rule even for entities with clear connections to the state, the prohibition is absolute. Compare this to neighboring Texas, Louisiana, or Mississippi, all of which permit state-name use in LLC names with no restriction.

Common mistake in Arkansas

The most common Arkansas LLC mistake is forgetting that the $150 franchise tax kicks in every May 1 regardless of whether the LLC has done anything. Founders form in summer or fall 2026, treat the $45 as the full cost, then get a delinquency notice in May 2027 for the unpaid franchise tax plus a $25 penalty and 10% interest. The second most common mistake is trying to register an LLC name with "Arkansas" in it and being surprised when the SOS rejects the filing. Plan the name to avoid the state-name prohibition before you start the filing process.

Sources

  1. Arkansas Secretary of State Business and Commercial Services, last verified 2026-05-14
  2. Arkansas Code Title 4 Chapter 32 (Small Business Entity Tax Pass Through Act), last verified 2026-05-14
  3. Arkansas Department of Finance and Administration, last verified 2026-05-14
  4. Arkansas Taxpayer Access Point (ATAP), last verified 2026-05-14
  5. IRS Publication 3402, Taxation of Limited Liability Companies, last verified 2026-05-14
  6. IRS Apply for an Employer Identification Number Online, last verified 2026-05-14

About the author

Aissam Baidi is the founder and researcher behind llcformationcost.com. He verifies Arkansas LLC fees directly from sos.arkansas.gov on a quarterly cycle. Connect on LinkedIn.

Not legal advice. Estimates based on publicly available data from each state's Secretary of State office. Consult a licensed attorney in your jurisdiction.

This is a syndicated post. Original article + interactive calculator: https://llcformationcost.com/arkansas-llc-cost/

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