[0:00] The short answer Dan: To start an LLC in Alabama, you reserve your name, then file a Certificate of Formation with the Alabama Secretary of State, and pay $208 online. Maya: Reserve the name first? Not file and hope? Dan: Alabama requires a Certificate of Name Reservation before you can file. Maya: This is The Business Formation Podcast. Today, Alabama for 2026, in six steps, with what it all costs and the three best ways to have it filed for you. Where do I begin? [0:29] Step 1: Reserve your LLC name Dan: Start with the name. It needs limited liability company, L.L.C., or LLC in it. Then you reserve it. Maya: What does a reservation cost? Dan: $28 online, or $25 by mail. Maya: How long does it last? Dan: One year. And a copy gets attached to your Certificate when you file. [0:50] Step 2: Name a registered agent Maya: Who can be my registered agent in Alabama? Dan: An Alabama resident or an authorized business, at an Alabama street address where legal papers can be served in person. Maya: A P.O. box? Dan: Not allowed. And the agent can't work only through a virtual office or mail forwarding. Maya: Is the address public? Dan: Yes. That's why many owners hire a commercial agent. Changing agents later costs $100. [1:17] Step 3: File the Certificate of Formation Maya: How do I file? Dan: Through the Secretary of State's online services. It's $208. Maya: And on paper? Dan: By mail it's $200, and $100 of that goes to the county where your agent is. Maya: What does the Certificate ask for? Dan: The name, your reservation, the registered agent and county, and a statement that the LLC has at least one member. Maya: I'm Maya, by the way, here with Dan. Dan: Great to have you, Maya. And note that the Certificate doesn't list the members' names. [1:47] Step 4: Write an operating agreement Maya: Is there a state form for the operating agreement? Dan: No. Alabama's law calls it a limited liability company agreement. You keep it with your records, and there's no state fee. Maya: Even for a one-person LLC? Dan: Alabama law says even a one-member agreement is enforceable. So put yours in writing. Maya: What goes in it? Dan: Who owns what, how profits are split, who makes decisions, and what happens if a member leaves. [2:15] Step 5: Get a free EIN Maya: What about the federal side? Dan: Apply for your EIN free with the IRS at IRS.gov, after the state files your Certificate. Maya: Is it instant? Dan: If the online application is approved, the number is issued right away. Maya: Anything local? Dan: Yes. You'll also need a business license from the county probate judge or license commissioner where you do business. Maya: And the beneficial ownership report? Dan: Skip it. FinCEN no longer requires it from U.S. companies. [2:43] Step 6: Ongoing requirements Maya: What do I file every year? Dan: Here's the good news. Alabama LLCs don't file an annual report with the Secretary of State. Maya: Nothing at all? Dan: Keep your registered agent current. And there's a business privilege tax return with the Department of Revenue in some years. Maya: When do I owe it? Dan: The tax is based on net worth. If it works out to $100 or less, there's nothing to pay and no return to file. That covers most small LLCs. [3:11] What it costs Maya: Give me the do-it-yourself total. Dan: $236 to form online. That's $28 for the name reservation plus $208 for the Certificate. Maya: And after that? Dan: There's no annual report fee, and the EIN is free. Maya: So year two costs what? Dan: Nothing to the state, as long as the privilege tax is $100 or less. [3:37] Online versus mail Maya: Does mail cost less? Dan: Yes. The reservation is $25 and the Certificate is $200. Maya: So that's? Dan: $225 by mail, against $236 online. Maya: An $11 difference. Dan: Right. Online is $3 more on the reservation and $8 more on the Certificate. [3:59] Picking your registered agent Maya: Could I be my own agent? Dan: If you're an Alabama resident with an Alabama street address where papers can be served in person, yes. Maya: And if I work from a virtual office? Dan: That doesn't qualify on its own. The address has to be a real street address. Maya: What if I want to change later? Dan: $100. So choose carefully the first time. [4:22] The county license Maya: Let me press on the license. Where does it come from? Dan: The county probate judge or license commissioner, in the county where you do business. Maya: Is that a state filing? Dan: No. It's local, separate from the Certificate. Maya: So the EIN doesn't replace it. Dan: Right. They're different steps. [4:41] The reservation and the Certificate together Maya: Why does the reservation come first? Dan: Because Alabama requires the Certificate of Name Reservation before you can file the Certificate of Formation. Maya: And it stays attached? Dan: A copy gets attached to the Certificate. So the two filings travel together. Maya: What if I take a while to get ready? Dan: The reservation holds the name for one year, so you have time. Maya: And what do I pay in total again? Dan: $28 plus $208 is $236 online. [5:11] The business privilege tax Maya: Explain the privilege tax like I'm new. Dan: It's a Department of Revenue tax based on net worth. Maya: Do small LLCs pay it? Dan: If it works out to $100 or less, there's nothing to pay and no return to file. That covers most small LLCs. Maya: And if it's more? Dan: Then you file the return. That's the only time it applies. Maya: Is it the same as an annual report? Dan: No. The Secretary of State has no annual report for Alabama LLCs at all. [5:40] What the Certificate leaves out Maya: Is my name public on the Certificate? Dan: The Certificate doesn't list the members' names. It lists the LLC name, your reservation, the registered agent and county, and a statement that there's at least one member. Maya: So the agent's address is the public part. Dan: Yes, the agent's address is public, which is one more reason people hire a commercial agent. [6:03] First-year checklist Maya: Give me the order of operations. Dan: Reserve the name. Choose your agent at an Alabama street address. File the Certificate online for $208. Then get your EIN, your county license, and write your operating agreement. Maya: And later? Dan: Keep your agent current, and watch the business privilege tax threshold. [6:23] The 3 best ways to file in Alabama Maya: What if I want someone else to handle it? Dan: Here are the three best ways to file in Alabama. Number one, our pick, is Mainstay Filing, $199 a year plus the state fee. With the $236 state fee, checkout comes to $435. Maya: What does that cover? Dan: Your name reservation and Certificate of Formation filed, your EIN application, and your registered agent every year. It renews at the same $199. Maya: Number two? Dan: AL Registered Agent.org. It prepares and files your Certificate for $199 plus the state fee, also $435 at checkout. The first year of agent service is free, then it's $99 a year. Maya: And number three? Dan: Alabama Registered Agent.co. Same offer. $199 plus the state fee, first year of agent service free, then $99 a year. Maya: How do I choose? Dan: Alabama has no annual report. So from year two, numbers two and three cost less, at $99 a year for the agent alone, against $199 for Mainstay. [7:32] Three years of service fees Maya: Give me the three-year view. Dan: Mainstay is $199 a year, so $597. Number two or three is $199 in year one, then $99 in each of the next two years, for $397. Maya: A $200 gap. Dan: Yes. That's the price of one steady $199 a year, renewing at the same amount. [7:58] Recap Maya: One more pass? Dan: Reserve a name with LLC in it, name a registered agent at an Alabama street address, file the Certificate of Formation online for $208, write an operating agreement, get your free EIN, and keep your agent current. There's no annual report. Maya: The links to all three services and every official source are in the show notes. Thanks for listening to The Business Formation Podcast, and good luck with your new Alabama LLC.