Starting a Limited Liability Company (LLC) in Washington State can be an exciting yet complicated endeavor.
One of the most important considerations before you embark on this journey is understanding the costs involved. In this article, we’ll walk you through the various fees associated with forming and maintaining an LLC in Washington State to help you better prepare your budget.
Washington LLC Formation Filing Fee
The first cost you’ll encounter is the LLC formation filing fee, which is a one-time fee of $200. This fee is paid to the Washington Secretary of State when you submit your Articles of Organization, either online or by mail. Note that an expedited service is available for an additional $50.
Washington Initial Report Fee
Within 120 days of your LLC formation, you’ll need to file an Initial Report. This report has a filing fee of $10 and helps the state of Washington maintain updated information on your business.
Washington Registered Agent Fee
All LLCs in Washington must designate a registered agent for service of process. The costs for this service can vary, depending on whether you act as your own agent or hire a professional service. The professional service fees can range from $100 to $300 annually.
Washington State Business License Fee
In addition to the LLC formation fees, you’re also required to obtain a Washington State Business License to operate. This license has an initial cost of $19 and is renewable every year for the same fee.
Washington Professional Licensing Fees
Some businesses, such as those in healthcare, real estate, or contracting, may require professional licenses. These fees vary depending on the profession and can range from $100 to several hundred dollars.
Local Business License Fees in Washington
Local jurisdictions may have their own licensing requirements and associated fees. These fees are separate from the state license and can vary from $50 to $300 depending on the locality and type of business.
Optional LLC Fees in Washington
There are additional services that you might consider, such as obtaining a Certificate of Good Standing ($20), or filing an amendment to your Articles of Organization ($30). These are optional and depend on the specific needs of your LLC.
Business Insurance Premiums
Business insurance is not a government-required fee but is highly recommended. Depending on the type of coverage you choose, premiums can range from $400 to $3,000 annually.
Cost to Register a Foreign LLC in Washington
If you have an existing LLC in another state and wish to operate in Washington, you’ll have to register as a foreign LLC. The filing fee for a foreign LLC is $200, similar to a domestic LLC. An Initial Report will also be required, with an additional $10 fee.
What are the costs involved in the formation process of an LLC in Washington?
Starting an LLC in Washington involves various costs to ensure your business entity is a legal entity compliant with state regulations. The formation process typically starts with a filing fee of $200. You can pay this fee online, by mail, or in person, and an expedited filing option is available for an extra charge. After entity formation, a $10 initial report is due, serving as your first annual report.
You’ll also need a registered agent, which can range in cost from acting as your own agent (free) to hiring a professional service (typically $100-$300 annually). A state business license is also mandatory, carrying a $19 state fee for both the initial issue and annual renewal. Some professions may require professional licensing, which requires an exam, specialized training, and additional fees.
Optional services like name reservation, certificate of good standing, and DBA (Doing Business As) or fictitious name registration come with additional charges. Also, if your LLC is a foreign LLC, you’ll need to register in Washington with the same $200 filing fee plus an initial $10 report fee.
Don’t forget about business insurance premiums, workers’ compensation insurance, and local municipality fees depending on your jurisdiction and type of business.
What are the compliance requirements, and what happens if my LLC is delinquent on state fees or reports?
Compliance with state regulations is crucial for operating an LLC in Washington. This involves timely filing of your annual report and payment of state fees, maintaining a registered agent, and ensuring that any professional licensing is up to date. If your LLC is delinquent in filing its annual report or paying required government fees, penalties and interest may apply. The due date for these obligations varies, so it’s essential to keep track.
An operating agreement, although not mandatory, is highly recommended for outlining the business entity’s internal rules and procedures. Failure to maintain one could jeopardize the legal entity’s privacy and liability protections.
Unregistered or foreign LLCs operating in Washington will face severe penalties if caught operating without proper registration in the jurisdiction.
For those in professions requiring professional licensing, failure to comply can result in additional fines and revocation of the license, which could render your business inoperative.
Make sure you’re in full compliance to avoid unnecessary complications. Check the Washington Secretary of State website regularly for any updates on fees or compliance requirements.
By being aware of all these costs and compliance requirements, you’ll be better prepared to successfully operate your LLC in Washington.
Forming an LLC in Washington involves a variety of fees, some mandatory and others optional. It’s essential to understand these costs upfront to budget appropriately for your business journey.
Always remember to stay updated with any changes in state requirements by visiting the Washington Secretary of State website. With the proper planning and budgeting, you’ll set your Washington LLC up for a successful start.
Brian Wilson is the content manager and founder of LLC Radar.
Brian grew up in North Texas, just outside of Dallas, and has a bachelor’s degree in business journalism from Southern Methodist University. Since graduating from SMU, Brian has gained over 10 years of experience in business writing for several online publications.
Brian resides in Plano, Texas and he can be reached by email: firstname.lastname@example.org