Key Takeaways

  • Choosing a compliant, unique business name and registered agent are the first essential steps in forming an LLC in Washington.
  • Filing a Certificate of Formation with the Washington Secretary of State is required to legally establish your LLC.
  • Creating an operating agreement, while optional, is highly recommended to define ownership, management, and decision-making procedures.
  • All LLCs must apply for a Unified Business Identifier (UBI) and file a business license application before operating in Washington.
  • Ongoing compliance includes annual reports, B&O tax registration, and employment-related filings if hiring staff.
  • Foreign LLCs and professional service companies have additional filing requirements.
  • Choosing the right tax classification (default pass-through or electing S or C corporation status) can optimize your business’s tax situation.

Setting up an LLC in Washington state involves the following steps:

  1. Choose an appropriate business name.
  2. Choose a registered agent.
  3. Create an operating agreement.
  4. Submit a certificate of formation to the state, along with filing fees.
  5. Obtain an Employer Identification Number.
  6. File a business license application.
  7. File an initial annual report with the state.
  8. Register for state tax.

Setting up an LLC in Washington: First Steps

The first step is to name your business. Washington, like other states, has specific naming requirements. You must include a designator in your company name that identifies it as an LLC. This may be one of the following:

  • LLC
  • L.L.C.
  • Limited Liability Co.
  • Limited Liability Company

You must also choose a unique business name that's distinguishable from existing companies in the state. You can do a name search at the Secretary of State database to check the availability of a name you wish to use. If desired, you can reserve a business name by filing a name reservation and paying a $30 fee. The reservation is good for 180 days.

Note that you won't be able to use “restricted designations” in your LLC name. These include the following:

  • Banking or bank
  • Trust
  • Cooperative
  • Partnership
  • Corporation or Corp.
  • LLP or Ltd.

You must elect a registered agent for your LLC. This is an individual or company that accepts and sends legal papers on your business's behalf. Your registered agent must be a resident with a physical address in the state or a company authorized to do business in Washington.

You can act as your company's registered agent or hire a registered agent service. Using a service comes with benefits such as always having an agent who's available during normal business hours.

Understanding Washington LLC Requirements

Before officially forming your LLC, it’s important to understand Washington’s legal and administrative requirements for business entities. Each LLC must comply with specific naming, filing, and registration rules set by the Washington Secretary of State and the Department of Revenue.

Key requirements include:

  • Principal Office Address: Your LLC must list a physical address in Washington (P.O. boxes are not allowed).
  • Registered Agent Consent: If using a third-party registered agent, they must provide written or electronic consent.
  • Foreign LLCs: If your business is formed in another state but operates in Washington, you must register as a foreign LLC by submitting a Certificate of Registration and appointing a Washington registered agent.
  • Professional LLCs (PLLCs): If your business provides professional services (e.g., legal, medical, accounting), it must form as a PLLC and ensure all members hold valid state licenses.

Important Documents

Washington doesn't require that you have an operating agreement, but it's still a good idea to prepare one. This legal document outlines your LLC's ownership and operating procedures.

Also, complete a certificate of formation. You'll fill in the blanks on this form and add the following information:

  • LLC name and address
  • The registered agent's name, address, and signature
  • Date of formation
  • Terms of existence (i.e., limited or perpetual)
  • Management type
  • Organizers' names and addresses

You can submit your certificate online or by mail. It takes two to three business days to process online filings. The fee is $180 for mail-in filing and $230 for online filing.

Operating Agreement Essentials

Although Washington law does not mandate an operating agreement, drafting one is strongly recommended to define how your LLC will function. This internal document clarifies ownership rights, voting powers, profit distribution, and procedures for adding or removing members.

A well-drafted operating agreement typically includes:

  • Member roles and responsibilities: Clearly define each member’s authority and duties.
  • Profit and loss distribution: Specify how profits are divided among members.
  • Voting procedures: Outline decision-making processes and voting thresholds.
  • Buyout and exit strategies: Establish terms for ownership transfer, dissolution, or withdrawal.
  • Management structure: Clarify whether the LLC will be member-managed (owners run operations) or manager-managed (appointed managers handle daily tasks).

Having a detailed operating agreement also helps protect your LLC’s limited liability status in case of legal disputes.

Reports, Licenses, and Taxes

You also need to obtain an Employer Identification Number, or EIN, from the IRS. You can apply for your EIN online for free from the IRS website.

You'll need an EIN to:

  • File business taxes
  • Open business bank accounts
  • Hire employees

If your LLC has two or more owners or members, you must have an EIN.

Next, file a business license application and pay the $20 fee. This officially registers your business in Washington state. When you file for a business license, you'll get a Unified Business Identification (UBI) number. The UBI is required to conduct business in the state. 

Your UBI links your business to the following:

  • Secretary of State
  • Business Licensing Service
  • Department of Revenue
  • Department of Employment Security
  • Department of Labor and Industries

Your business license also allows you to create a state employment account, which is required if your business hires employees. If you plan to hire someone within the next three months, you must have a state employment account.

File your initial annual report with the state within 120 days of filing your formation documents. The cost for the initial filing is $10.

Washington has no personal or corporation income tax, and most LLCs don't pay state income taxes. However, LLCs pay a business and occupation (B&O) tax.

If your business has employees, you must pay employer taxes. You'll also have to inform the state and the IRS when you hire workers. You must then register for unemployment insurance and workers' compensation. You can do this at the same time you file for your business license.

LLCs are generally an easy, inexpensive enterprise to form, and it's the preferred structure for many small business owners. You can refer to the Secretary of State office for tips and information on starting an LLC.

Ongoing Maintenance and Compliance

Maintaining your LLC’s good standing in Washington involves ongoing administrative tasks:

  • Annual Report: File an annual report with the Secretary of State by the end of your LLC’s anniversary month. The filing fee is $60.
  • Recordkeeping: Maintain accurate financial and membership records to comply with state audit requirements.
  • Registered Agent Updates: Notify the state promptly if you change your registered agent or their contact information.
  • Business License Renewals: Renew state and local licenses annually to avoid penalties or suspension.

Failure to meet these obligations can result in late fees, administrative dissolution, or loss of liability protection.

Tax Classification and Compliance

By default, LLCs in Washington are treated as pass-through entities for federal tax purposes, meaning profits and losses are reported on individual members’ tax returns. However, LLCs can elect to be taxed as an S corporation or C corporation to potentially reduce self-employment taxes or reinvest profits back into the company.

Other key tax considerations include:

  • Business and Occupation (B&O) Tax: Most LLCs must pay this gross receipts tax, which varies by industry.
  • Sales and Use Tax: Required if you sell goods or taxable services within Washington.
  • Employer Taxes: If hiring employees, register with the Employment Security Department (ESD) and Department of Labor & Industries (L&I) to handle payroll taxes and workers’ compensation.

Business Licensing and UBI Registration

Once your Certificate of Formation is filed, you must apply for a Washington State Business License through the Business Licensing Service (BLS). This step registers your LLC and issues a Unified Business Identifier (UBI), a nine-digit number required for state tax filings, employment records, and regulatory compliance.

Some businesses may also need additional local permits or industry-specific licenses, depending on their activities. Examples include:

  • Health permits (for food service businesses)
  • Liquor licenses (for bars or breweries)
  • Professional licenses (for healthcare, legal, or financial services)

Frequently Asked Questions

  1. How much does it cost to start an LLC in Washington?
    Filing a Certificate of Formation costs $180 by mail or $230 online. Additional expenses may include business licenses, registered agent fees, and local permits.
  2. How long does it take to form an LLC in Washington?
    Online filings are typically processed within 2–3 business days, while mail submissions may take up to 2 weeks.
  3. Can a single person start an LLC in Washington?
    Yes. Washington allows single-member LLCs, which are treated as sole proprietorships for tax purposes by default.
  4. Do I need a business license for my LLC?
    Yes. Every LLC must register with the Washington Business Licensing Service and obtain a Unified Business Identifier (UBI) before legally operating.
  5. What happens if I don’t file an annual report?
    Failing to file your annual report can lead to late fees, administrative dissolution of your LLC, and loss of legal protections.

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