How to Start an LLC in South Carolina (2026 Guide)
South Carolina charges $110 to form your LLC — and then, for most LLCs, never charges you again at the state level. No annual report, no franchise tax. But don't let that simplicity fool you: your city or county almost certainly has its own business license requirement, with real financial risk if you skip it.
To start a South Carolina LLC, file Articles of Organization with the South Carolina Secretary of State for $110 by mail or $125 online, with online processing in 1–2 business days (mail takes 5–7 business days plus delivery time). South Carolina requires no annual report for most LLCs — the only exception is LLCs that elect S-corporation taxation, which must file an Initial Annual Report (Form CL-1, $25) with the Department of Revenue. There is no state franchise tax. However, many cities and counties require their own local business license based on gross receipts, and operating without one risks up to 3 years of backdated fees. State income tax is shifting to a new two-rate system starting the 2026 tax year: 1.99% on the first $30,000 of taxable income, 5.21% above that.
- State filing fee
- $110 ($125 online)
- Processing time
- ~1–2 business days online
- Annual report
- None — except S-corp elections
- Franchise tax
- None
- Local business license
- Required by most cities/counties
- Income tax (2026+)
- New: 1.99% / 5.21% two-rate
Why Form an LLC in South Carolina?
South Carolina offers a genuinely low-maintenance state-level structure. What you get:
- A below-average $110–$125 formation fee — with fast 1–2 business day online processing.
- No annual report for the large majority of LLCs — one of a small group of states that skips this entirely for default pass-through LLCs.
- No franchise tax — nothing recurring owed to the Secretary of State after formation.
- A brand-new, lower entry-level income tax rate — starting the 2026 tax year, the first $30,000 of taxable income is taxed at just 1.99%.
Don't mistake "no state annual report" for "no ongoing compliance." South Carolina genuinely has no statewide general business license, but the large majority of cities and counties run their own local business license tax based on gross receipts — and if you skip it, you can be assessed up to 3 years of backdated fees once discovered. This local layer is where most South Carolina LLC compliance mistakes actually happen. See Step 7 for the full picture.
How to Start a South Carolina LLC in 8 Steps
Your name must be distinguishable from every South Carolina entity and contain "LLC" or "Limited Liability Company." Search free through the Secretary of State.
Every South Carolina LLC must continuously maintain a registered agent — an SC resident or authorized entity with a physical in-state street address.
File the Articles of Organization
$110 by mail or $125 online — online approval typically runs 1–2 business days, the fastest option South Carolina offers.
Not required by South Carolina, but it overrides state default rules, satisfies your bank, and hardens a single-member LLC's liability shield.
Get Your Free EIN from the IRS
Your federal tax ID for banking, hiring, and South Carolina Department of Revenue registration. Always free at IRS.gov.
Confirm: No Annual Report (Unless S-Corp)
Most LLCs owe nothing here. LLCs electing S-corp taxation file Form CL-1 ($25) with the Department of Revenue.
Get Business Licenses & Permits
No statewide general license — but a local city/county business license is very likely required, plus a Retail License if selling taxable goods.
Understand South Carolina LLC Taxes
A new two-rate income tax starting 2026 (1.99% / 5.21%), no franchise tax, and a 6% base sales tax plus local option taxes up to 3%.
What a South Carolina LLC Really Costs (2026)
| Cost Item | Amount | When |
|---|---|---|
| Articles of Organization (required) | $110 ($125 online) | One-time, at formation |
| Annual report (required) | $0 — none for most LLCs | Never, unless S-corp elected |
| Registered agent service (optional) | $100–$150/yr | Annual, if hired |
| Local business license (very likely required) | $25+ (varies) | Annual, per city/county |
| Retail License (if selling taxable goods) | $50 | One-time, before taxable sales |
| EIN from the IRS | $0 — always free | At IRS.gov |
| Name reservation | $0 — no extra charge | Claimed automatically upon filing |
Bottom line: $110–$125 to form, and — for most LLCs — genuinely nothing owed to the Secretary of State ever again. Your real recurring cost is almost certainly a local city or county business license, not a state fee. Model your exact setup below.
South Carolina LLC Cost Calculator
South Carolina LLC Cost Calculator
First-year + 5-year totals · verified July 2026
Excludes state income tax. Local business license fees vary significantly by city and county — confirm your exact amount before finalizing your budget.
No Annual Report — With One Exception
South Carolina genuinely does not require most LLCs to file an annual report with the Secretary of State. The one carve-out: if your LLC elects S-corporation taxation, you must file an Initial Annual Report (Form CL-1, $25) — but this goes to the Department of Revenue, not the Secretary of State, and it's a consequence of the tax election, not a standard LLC requirement.
South Carolina LLC Taxes at a Glance
Default LLCs pass profits to your personal return. Starting the 2026 tax year, South Carolina adopts a new two-rate system: 1.99% on the first $30,000 of taxable income, and 5.21% on income above that (minus a $966 adjustment) — a meaningful simplification and reduction from the prior graduated brackets topping out at 6.0%. Add federal self-employment tax of 15.3%. The LLC itself owes no franchise tax. Sellers collect 6% state sales tax plus local option taxes up to 3%, for a combined rate averaging around 7.4% and reaching 9% in some counties. Details in Step 8.
Ahmad Adil's Take: South Carolina is a genuinely low-friction state at the Secretary of State level — a reasonable formation fee, no annual report, no franchise tax. But I don't want that simplicity to create a false sense that South Carolina LLCs are maintenance-free, because the local business license layer is real, it's financially meaningful, and the 3-year backdated fee risk is not a bluff — it's how South Carolina municipalities actually enforce this. My honest advice: the moment you form, check your specific city and county's business license portal before you do anything else compliance-related. That's genuinely the step most new South Carolina LLC owners get wrong, not anything at the state level.
- ✓Forms your South Carolina LLC for $39 + the $110 state fee
- ✓Files online with the Secretary of State
- ✓Free South Carolina registered agent the first year
- ✓No upsells · No data selling · Privacy by Default
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South Carolina LLC — FAQ
Ahmad Adil is the founder and CEO of LLC School. The figures here — the $110 Articles of Organization, the fact that most South Carolina LLCs never file an annual report, and the new 2026 two-rate income tax — reflect current South Carolina Secretary of State and Department of Revenue guidance. This is educational content, not legal or tax advice.
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