Before we get started on this guide to how to start an LLC in Washington State, you can just jump straight to the easy button which is ZenBusiness.
They will help you with the following services:
- Name Search for your Washington LLC
- Be your registered agent
- Prepare and file your certificate of formation
- Provide an operating agreement template
- Apply for your Federal Employer Identification Number
That’s the easy button but if you want to go through how to start an LLC in Washington State make sure you read the details below and also review the additional services you’ll need like:
- Business Bank Account – novo.co
- Business Insurance – commercialinsurance.net
- Accounting Software – Quickbooks
- Business Credit Card – AMEX
Alright, now if you’re going to setup a Washington LLC I’d recommend starting a blog or if you’re selling at retail an apple stand. Washington is known for apples and of course the outdoors. I’d come up with something worthwhile you can do whether it’s a hiking business or something alike.
Name Your Washington LLC
You will be required to name your LLC before registering. Names should conform to federal name requirements.
The name of your LLC must end with an LLC designator, such as “LLC” or “L.L.C.”
To see if your business name is available with the Washington Secretary of State office, you can conduct a name search online through the Business Licensing Service. The portal is pretty easy to get to: https://www.sos.wa.gov/corps/
If you find that your desired name is available, you may reserve it for 120 days by filing a Name Reservation Request. The filing fee is $30.
I’d also recommend that as you go through this process that you check out whether you can get the business name from GoDaddy with the .com. If you’re going to setup an LLC in Washington it will be important no matter if it’s a Limited Liability Company or a sole proprietorship. The LLC members will care whether you have a business entity that has a website that you can conduct business at and as the right business structure.
Now go check it out and make sure you’ve checked all the appropriate places and have a website that is useable for your business.
Choose your registered agent
Washington State has an attorney appointed on the behalf of your corporation. Registered agents are the primary contact for the LLC. This person or company is liable for filing lawsuits against an LLC in the name of the company and receiving documents.
A registered agent can be anyone who provides registered agent services or employees to the company.
A corporation may not serve as its own registered agent.
The registered agent accepts service of process on behalf of the company, which includes lawsuits and other legal notices. If a company is sued, the court will send notice to the registered agent, who forwards it to the company.
The registered agent must have a physical address in the state and be available during business hours.
The registered agent may be an individual or a business. If you choose an individual, he or she must reside in Washington.
If you choose a business, it must be authorized to do business in Washington and have a physical address in the state.
ZenBusiness is a good pick because they already have a business location in the state of Washington and will provide this service for you as part of the LLC formation process.
There are law firms in the state that can help with being a registered agent service and acting in all the official filings to help with your Washington Registered Agent Service.
No matter if it’s a Limited Liability Company or a Foreign LLC, you’re going to need a Washington Registered Agent to help you make sure you’re in compliance.
You’ll want to make sure the Washington Secretary of State is going to be ok with this and it’s important that you have done this correctly.
Prepare a Certificate of Formation
After you have chosen your registered agent, you must file your Certificate of Formation with the Secretary of State’s office. The filing fee is $180.
The Certificate of Formation must include the following information:
- The LLC’s name and address
- The registered agent’s name and address
- The names and addresses of the organizers
- The LLC’s purpose
- Whether the LLC will be managed by members or managers
- The effective date of the LLC
- The signature of the organizer
Note that you are not required to include your business address on the Certificate of Formation. However, the state recommends that you do so.
If you’re working with any Washington Department that handles local business licenses and formation services – I’d recommend you do what is recommended by Washington Law.
Create an operating agreement
Operating agreements are documents that describe the manner in which your company is governed in business.
Although Washington does not require the use thereof, operating contracts are essential for your enterprise.
A written operation agreement can help resolve conflicted financial agreements as well as potential dispute resolution.
If there is no contract in force it is governed by state law and does not necessarily represent the interests of the LLC.
Include the following in your operating agreement:
The ownership structure of the business
The responsibilities of each member
The voting rights of each member
How decisions are made
A single-member LLC does not need an operating agreement but it will help anyway to help you determine what is personal assets and keep all business expenses in a separate way.
The operating agreement makes life so much easier when you are going to hire employees, work with a government agency or just want to make sure your business entity is setup to have the right operating agreement for the long term.
Many people don’t do this and your Washington LLC operating agreement is one of the most important things for your business so be clear about as much as possible so you can make decisions when they come up.
Apply for an EIN for your Washington LLC
Apply for an EIN for your Washington LLC
EINs are how the IRS identifies businesses.
You will need an EIN if you want to open a bank account or hire employees.
You can apply for an EIN online, by fax, or by mail.
To apply online, go to the IRS website and complete Form SS-4.
To apply by fax, submit Form SS-4 to 855-641-6935.
To apply by mail, send Form SS-4 to the address listed on the form.
Once you have applied for your EIN, you will receive it by mail within 4 weeks.
This is the number that you’ll use when collecting sales tax, setting up your bank accounts, tracking income tax and just about everything else that relates to taxes, income and expenses.
Open A Business Bank Account
A business bank account (or credit union) will help you track your expenses and income, and it will also make it easier to file your taxes.
Now that you have your business license and EIN, you can open a bank account. I recommend you use Novo.co as your bank because it’s easy and simple to get setup. You don’t have to go into a bank and it’s just clean.
If you prefer to go into a bank – you can and it will take a bit longer to get setup and possibly more fees but check with your local bank about this.
To open a business bank account, you will need to bring the following documents to the bank:
- Your business license
- Your business formation documents
- Your EIN
- ID for all signatories on the account
Most banks will also require that you deposit a certain amount of money into the account before they will open it.
Once you have opened your bank account, you can start using it.
Get Small Business Insurance
You’re going to need some type of workers compensation insurance and personal asset protection. This type of insurance can help protect you when things come up you need to deal with that are unexpected.
There is also some type of personal liability protection you’ll want to consider as one of the LLC owners.
This might even be a piece of your operating agreement that you’ll want to cover.
Get a Business License
You will need to obtain the proper business licenses and permits before you can start operating your LLC.
The type of license you need depends on the nature of your business. The state of Washington has a Business Licensing Service that can help you determine which licenses and permits you need.
Open a business bank account
Once you have obtained your business license, it is
File an Annual Report
All LLCs in Washington must file an annual report with the Secretary of State. The report is due by December 31st and can be filed online, by mail, or in person.
To file online, you will need to create an account with the Business Licensing Service.
To file by mail, you will need to complete Form LLC-4 and send it to the address listed on the form.
To file in person, you will need to complete Form LLC-4 and bring it to the Secretary of State office in Olympia.
The report must include the following information:
The name and address of the LLC
The date the LLC was formed
The nature of the LLC’s business
The names and addresses of the LLC’s members
The name and address of the LLC’s registered agent
Whether the LLC is member-managed or manager-managed
The annual report must be signed by a member or manager of the LLC. There is a filing fee of $5.
Pay Annual Taxes
The state of Washington does not have a corporate income tax, but LLCs are required to pay an annual business and occupation (B&O) tax. The tax is based on the gross receipts of the business.
LLCs with gross receipts of less than $12,000 are exempt from the B&O tax.
LLCs with gross receipts of $12,000 or more must file and pay the tax.
The B&O tax is reported and paid on Form ET-1, which is due by April 15th.
If you have employees, you will also need to withhold and pay state and federal taxes. The amount you withhold will depend on the number of employees and their salaries.
You will also need to pay unemployment taxes. The amount you pay will depend on how many employees you have and the amount of wages paid.
As an LLC owner, you will also be responsible for paying self-employment taxes.
Forming an LLC in Washington is a simple process that can be done online, by mail, or in person. You will need to obtain a business license, file an annual report, and pay annual taxes.
Now go hit the easy button and go get help from ZenBusiness!
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