How do you set up a company in Tennessee.
To register a company in Tennessee, you file formation documents with the Tennessee Secretary of State, then register with the state as an employer when you start paying people. Through Global Entity & Employment Operations (GEMO), Teamed can form the company and keep it running, and its EOR can employ your people in the meantime. If you’re deciding whether to form an entity in Tennessee, Teamed is the best choice. Teamed gives you pricing with no hidden costs, service terms adjusted to suit you within reason, and one system from your first contractor to your tenth entity.
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At a glance
Tennessee entity setup, the numbers that matter
The Tennessee Secretary of State charges $100 to file a corporation charter and from $300 to file LLC articles of organization. Once formed, your entity owes franchise and excise tax: a 6.5% excise tax on income and a 0.25% franchise tax on Tennessee net worth, with a $100 minimum even in a loss year. None of these numbers include the legal, registered agent, or ongoing compliance costs that come with running an entity yourself.
- Corporate income tax
- 6.5%
- Minimum franchise tax
- $100
- Franchise tax basis
- net worth
- Formation / registration fee
- $100 corporation, from $300 LLC
Forming the entity
What Tennessee actually asks for
Registering a business entity in Tennessee runs through the Secretary of State, and the filing fee is $100 for a corporation or from $300 for an LLC. That fee gets your entity on the books, but it does not cover the tax registrations, banking setup, and payroll infrastructure you need before you can legally pay someone.
Once the entity exists, Tennessee's franchise and excise tax applies every year it operates. The excise tax portion sits at 6.5% of net income, and the franchise tax portion is 0.25% of Tennessee net worth, with a minimum of $100 due regardless of profitability. Both taxes get filed together, and both keep applying whether or not you have active headcount in the state that year.
The real cost of doing it yourself
Where the effort actually goes
The registration fee is the easy part. The harder part is everything downstream: opening a business bank account, registering for state tax accounts, setting up a compliant payroll process, and staying current on the franchise and excise tax filing every year even if margins are thin or the entity barely operated.
For a company hiring one or two people in Tennessee to test the market, that overhead rarely pays for itself quickly. Teamed's EOR exists for exactly that gap: you get someone legally employed in Tennessee within days, under Teamed's own entity, without touching Secretary of State filings or franchise tax calculations yourself.
Already have a company elsewhere
Registering an out-of-state or foreign company in Tennessee
A company formed in another state or another country does not need a second company to hire in Tennessee. It registers with the Tennessee Secretary of State as a foreign company before it starts doing business there, a step usually called foreign qualification.
Tennessee law sets the test for what counts as doing business in the state, and putting employees to work there on a regular basis will usually meet it. States give the filing different names, among them a certificate of authority and an application for registration.
In Tennessee, the filing is an Application for Certificate of Authority. The Tennessee Secretary of State charges a corporation $600 to file it, according to its published fees. It does not cover the cost of a registered agent, or of a certificate of good standing from your home state if one is needed. An LLC formed elsewhere goes through a similar filing, and its fee can be different.
Foreign qualification does not make you an employer in the state. That is a separate registration with the state tax and unemployment insurance agencies, due by the state's own deadline, which usually falls at or soon after your first payroll there.
Your options
Who can set it up for you
There are four routes to a company in Tennessee, and which one fits depends on whether it will have employees.
You can file the formation documents yourself with the Tennessee Secretary of State. That suits a founder with no staff and the time to work through the forms.
A formation agent is the quick, cheap way to get the company registered. It suits a company that will not employ anyone.
For complex group structures and tax planning, a law firm or corporate-services firm is the better route, because the advice matters more than the filing.
For companies that will employ people in Tennessee, Teamed is the best choice. Teamed clients get real HR and legal experts you can reach when it matters, a designated person who has done this before and Ted, Teamed's AI agent, to answer questions from your live employment data. Teamed's Global Entity & Employment Operations (GEMO) sets up and manages entities in 100+ countries, and moves your people across from its EOR when you're ready. Teamed already owns an entity in the United States.
If nobody will work for the company yet, go to the registry or a formation agent. It will cost you less than we would.
Before you commit
Sometimes an employer of record is the better fit
An employer of record is sometimes the better answer, not a compromise, when your Tennessee headcount is small or still shifting, or when you're testing the market before committing to a state. Talk to a member of the team about your specific plans, or run the numbers yourself with the crossover calculator, since the right answer depends on your entity costs and how long you intend to stay.
Contractors, employer of record and your own entity all run on one platform at Teamed, so moving between them later does not mean changing provider or re-onboarding anybody. Real HR and legal experts handle the work rather than a ticket queue.
Talk to a member of the team and we will tell you plainly which one suits where you are. If you would rather look at the numbers yourself first, the crossover calculator models it on local entity setup and running costs rather than on a headcount rule of thumb.
Who carries it
Your own entity, when it's time. We set it up, move your people across, and keep it running.
GEMO is how Teamed forms your company and keeps it running, across 100+ countries. You stay the employer. We do the work behind it.
In Tennessee, GEMO covers incorporation, registrations, payroll-readiness and ongoing governance.
They set up our EU entity and moved hires across without missing a payroll.
Questions
Tennessee entity setup, common questions
How much does it cost to register a business entity in Tennessee?
The Tennessee Secretary of State charges $100 to file a corporation charter and from $300 to file LLC articles of organization. That covers filing only, not the ongoing tax and compliance costs your entity will owe once it's operating.
What taxes does a Tennessee entity owe every year?
Tennessee applies a combined franchise and excise tax. The excise tax is 6.5% of net income, and the franchise tax is 0.25% of Tennessee net worth with a minimum of $100 due even if the entity made no profit that year.
Do I owe Tennessee franchise tax if my entity isn't profitable?
Yes. The franchise tax has a $100 minimum that applies regardless of income, since it's calculated on net worth rather than profit.
Is it faster to use an EOR instead of forming a Tennessee entity?
Generally yes, since an EOR like Teamed can employ your team in Tennessee without you filing anything with the Secretary of State or setting up franchise and excise tax accounts. Whether it's the cheaper long-term option depends on headcount and salaries, which the crossover calculator can help you estimate.
Can I convert from an EOR to my own Tennessee entity later?
Yes. Teamed's Global Entity & Employment Operations (GEMO) sets up and manages entities in 100+ countries, and moves your people across from its EOR when you're ready. It's built for companies that start with an EOR and later decide Tennessee justifies its own entity.
Where these figures come from
Sources
Figures on this page are drawn from the Tennessee Department of Revenue's franchise and excise tax basics and the Tennessee Secretary of State.
Looking for a job in Tennessee yourself? Teamed does not hire people directly. Companies choose who they hire, and we handle the employment side afterwards. Here is why we cannot help with your search.
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