LLC vs. Corporation: Formation Basics
Plain-language explainer, scoped to the formation filing. For official state fees, see the LLC Formation and Corporation Formation matrices. Not legal advice.
Short answer
Forming either entity means filing a creation document with the state and paying a filing fee. The mechanics are similar; the terminology and the fee structure differ. This page covers the formation step — not the broader tax or liability choice between the two.
The creation document
An LLC is created by filing articles of organization (called a certificate of formation in some states). A corporation is created by filing articles of incorporation (or a certificate of incorporation). Both name the entity, its registered agent, and basic details, and both take effect when the state accepts the filing.
Why the fees differ
States set formation fees separately for each entity type. LLC fees are usually a flat amount. Corporation fees are sometimes flat and sometimes scaled to the number of authorized shares or par value, which is why a corporation can cost more to form in some states. The matrices track each entity type's fee in its own column.
What it costs
Compare the official per-state fees in the LLC Formation and Corporation Formation matrices, each with standard and expedited turnaround where the state publishes it.
Not legal advice
Choosing between an LLC and a corporation involves tax, governance, and liability factors well beyond the formation fee. This page does not address those; consult a qualified professional.
See also: LLC Formation Fees (matrix) · What is a registered agent?
Frequently asked questions
What document creates each entity?
An LLC is created by filing articles of organization (or a certificate of formation); a corporation by filing articles of incorporation. Both are filed with the state's business office.
Why do corporation formation fees sometimes depend on shares?
Several states base the corporation filing fee on the number of authorized shares or par value, so a corporation with many authorized shares can cost more to form. LLC fees are typically flat.
Which is cheaper to form?
It depends on the state and, for corporations, the share structure. Compare the LLC Formation and Corporation Formation matrices for the official state fee in all 51 jurisdictions.
Does this page cover taxes or liability differences?
No — this is about the formation filing itself. Tax treatment and liability are separate considerations best discussed with a professional.
Go deeper with source-backed research
Explore methodology, datasets, and related matrices cited on this page.