Starting a LLC in Washington State: Everything to Know
Starting a LLC in Washington State is the process for creating a limited liability company.3 min read
Starting a LLC in Washington State is the process for creating a limited liability company. This business structure combines the advantageous tax structure and administrative flexibility of a partnership with the limited liability protection offered by a corporation.
LLCs are popular among small business owners. To create a Washington LLC, you'll need to file a certificate of formation with the state and adhere to other procedures and eligibility requirements.
Naming Your LLC
Washington has specific naming rules for your LLC as follows:
- The name must include LLC, L.L.C., Limited Liability Company, or Limited Liability Co.
- The name must be different than those of other businesses registered with the state.
- The name must not cause confusion with the name of another business.
- The name must not include restricted words such as bank, banking, banker, trust, partnership, cooperative, corporation, corp., incorporated, LP, LLP, inc., ltd., or combinations of industrial and loan and combinations of any of the following words: savings, loan, association, home, society, and building.
Once you choose a name that meets these requirements, you can search the Washington Secretary of State business name database to find out whether it's available. If the name is not taken, you can reserve it for 180 days for a fee of $30. You should also see whether a domain name is available for your preferred name and purchase it to create a website for your business.
Designating a Registered Agent
The registered agent is an individual or business who is responsible for accepting service of process and other legal paperwork on behalf of your LLC as well as submit annual state filings. The registered agent must be a Washington resident or an LLC or corporation that is registered to do business in the state, both with a physical address in the state. You or another LLC member can serve as a registered agent. You can also opt to use a registered agent service if you live out of state, if you want the convenience of a service that's open during business hours, and if you want guidance about legal professionals and accountants in the state.
Filing a Certificate of Formation
You can access the certificate of formation from the Washington Secretary of State website. This form is required to create your Washington LLC. It asks you to provide the name and registered address of your LLC, its date of formation, whether its existence is perpetual or limited, whether the business will be managed by the members or by professional managers appointed by the members, and names and addresses of the members responsible for creating and signing the certificate.
The paperwork can be submitted by mail or online and will be processed in two to three business days if you do so online. The online filing fee is $230 and the filing fee for mailed documents is $180. The form is payable by a debit or credit card online and can also be paid by check if you file through the mail.
Drafting an Operating Agreement
An operating agreement is not required by Washington state, but can help you organize the affairs of your LLC. This document does not need to be filed with the Secretary of State but should be saved as a reference of the business's operating rules and regulations.
An EIN, or employer identification number, is used to identify your business with the IRS and is used to open a business bank account, hire employees, and file state and federal taxes. You can request a free EIN from the IRS. Even if your LLC only has one member, registering for an EIN helps you establish a separate credit history for your business and distinguish between personal and business finances.
To preserve the limited liability protection offered by your Washington LLC, keeping business and personal finances and expenses separate is essential. Opening a business bank account and line of credit are two important steps in this process. This will also make it easier to keep your business books and file taxes.
Most Washington businesses must pay a Business and Occupation Tax. If your business has employees, you are subject to Unemployment Insurance Tax.
If you need help with starting a limited liability company in Washington 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.