How To Set Up a LLC in Washington State: Everything You Need to Know
Finding out how to set up an LLC in Washington state is as simple as following a few key steps, such as selecting a suitable business name, designating a registered agent, and filing specific documents. 3 min read
Finding out how to set up an LLC in Washington state is as simple as following a few key steps, such as selecting a suitable business name, designating a registered agent, and filing specific documents.
How to Form an LLC in Washington
If you'd like to create an LLC (limited liability company) in Washington, your LLC will be a “hybrid” entity that enjoys some features of partnerships and corporations. For instance, LLCs have simple annual filing requirements and protections from double taxation like partnerships, as well as a corporation's limited liability protection.
While LLCs don't pay state income taxes, they do pay business and occupation taxes, or B&O tax.
Forming an LLC is very easy. You can register your business using an online wizard or submit a two-page form. To form an LLC in the state, you'll follow these steps:
- Name your LLC.
- Select a registered agent.
- File your Certificate of Formation.
- Draft an operating agreement.
- Obtain an Employer Identification Number, or EIN, from the IRS.
Follow naming guidelines to make sure your business name is approved. Your LLC name has to contain any of the following:
- Limited Liability Company
Avoid restricted words, such as “University” or “Bank,” unless you have the necessary additional paperwork and/or licensed professionals in your business. Some words, such as “FBI” or “Treasury” are prohibited, since a business with those words in the name can confuse the public into believing it's associated with a state or federal agency.
Your LLC name must be distinguishable from existing business names in the state. You can check business name availability at the state website.
You can file a name reservation with the Secretary of State if you want to reserve a business name. Reservations are good for 180 days and cost $30 to file.
You might also want to reserve a domain name once your business name is approved. Even if you're not planning to create a website right away, securing the domain name will prevent someone else from acquiring it.
Your LLC must have a registered agent, which is an individual or business who accepts legal paperwork and service of process on your company's behalf. Registered agents must be state residents or companies authorized to transact business in the state. They must have a physical street address in Washington.
To register your business, file your certificate of formation with the state. You can do this in person, online, or mail it in. In your formation documents, you'll have to provide the following:
- Your LLC's name and address
- Each organizer's name, address, and signature
- Effective date
- Management type, i.e., member-managed or manager-managed
- Registered agent's name, address, and signature
An operating agreement outlines your business's ownership and operating procedures. You're not required to have one, but it's recommended to draft one if your LLC has more than one owner/member.
You'll use your EIN to file your business taxes. If you're the sole owner of your LLC, you can use your social security number for tax purposes. If your LLC has more than one member, an EIN is required. An EIN is like a business's social security number. It's also known as a Federal Tax ID Number.
When you create a business, you'll have to file a business license application. If you hire employees, you must also create a state employment account.
Once you file a business license agreement, you'll receive a unified business identification number, or UBI. The UBI is a nine-digit number you'll use for conducting business in the state. Your UBI links your business to the following:
- Business Licensing Service
- Department of Revenue
- Secretary of State
- Employment Security Department
- Labor and Industries Department
Most jurisdictions in Washington require you to have a license to conduct business within city limits. You might also need a contractor's license and/or specific permits and zoning permissions.
Starting an LLC is a relatively simple, inexpensive process that many individuals can do themselves. Just be aware of all rules and guidelines so that your setup goes smoothly and quickly. You can perform many actions online, allowing you to create a business from your home or office.
If you need help with forming an LLC in Washington or another state, you can post your legal need on UpCounsel's marketplace. UpCounsel accepts only the top 5 percent of lawyers to its site. Lawyers on UpCounsel come from law schools such as Harvard Law and Yale Law and average 14 years of legal experience, including work with or on behalf of companies like Google, Menlo Ventures, and Airbnb.