If you're considering forming a limited liability company (LLC) in Washington D.C., you'll want to be familiar with the business formation expenses.
To help you save time, we spent weeks researching the costs of the essential requirements needed to establish a Washington D.C. LLC.
In this article, we’ll share everything you need to know about Washington DC LLC fees so you can plan your business funds wisely.
Quick Summary
- Forming an LLC in Washington D.C. includes a $220 filing fee with the Department of Consumer and Regulatory Affairs.
- In addition to state fees, other costs may be associated with forming an LLC, such as legal or accounting fees.
- While forming an LLC in Washington D.C. can be costly, it can provide liability protections and tax benefits for business owners, making it a worthwhile investment for many entrepreneurs.
How Much Does An LLC Cost In Washington, D.C.?
An LLC in Washington D.C. costs $200, which only covers the filing fee for the Articles of Organization, also referred to as the Certificate of Formation.
In addition to the $200 filing fee, there are several other expenses to consider when setting up an LLC in Washington, D.C.
Factors to consider include whether you plan to engage a Washington DC Registered Agent, reserve a Business Name, obtain a Certificate of Occupancy or Home Occupation Permit, acquire a Basic Business License, and submit your LLC's Biennial Report.
Washington D.C. LLC Filing Fee
The Washington D.C. LLC Filing Fee is $220, and this fee is charged by the Department of Consumer and Regulatory Affairs (DCRA).
This fee covers the basic processing and filing of the Articles of Organization. However, additional fees may apply if expedited processing or other services are required.
Washington D.C. Registered Agent Service Fee
The Washington D.C. LLC Registered Agent Service Fee is the cost of hiring a registered agent for an LLC in Washington D.C.
The fee for a registered agent service in Washington, D.C., can range from approximately $100 to $300 per year, depending on the service provider and the level of service required.
A registered agent must have a physical address in Washington, D.C., and be available during normal business hours to receive legal documents and other official correspondence on behalf of the LLC.
Though you can be your own registered agent, hiring a professional registered agent is essential to ensure that the LLC complies with all state and federal regulations and that all legal correspondence is received and handled appropriately.
Washington D.C. Business/License Tax
The Washington D.C. LLC Business/License Tax is a tax imposed on LLCs in Washington D.C. LLCs in Washington, D.C., must pay annual fees for LLC Business Licenses based on the LLC's gross receipts earned in the District of Columbia.
The Business License fee for LLCs in Washington DC ranges from $250 to $4,000, depending on the LLC's gross receipts.
Other LLC Filing Costs
1. Name Reservation Fee
A Name Reservation Fee is required for those who want to reserve their desired business name for their LLC in Washington, D.C.
The name reservation fee is $50 and can be paid by check, money order, or credit card. The name reservation application can be filed online or by mail with the Department of Consumer and Regulatory Affairs (DCRA).
Once the application is processed, you will receive a confirmation notice with the reservation number, allowing you to reserve your desired business name for up to 120 days.
You need to know that a name reservation does not guarantee that the name will be approved for use when you file the Articles of Organization for your LLC.
2. DBA
A DBA is known as a trade name. The D.C. LLC cost of filing for a DBA is $55. This fee is paid to the Department of Consumer and Regulatory Affairs (DCRA) at the time of filing.
Registering for a DBA allows a business to operate under a different name than its legal name.
Still, it does not provide legal protection for the name or prevent others from using a similar name.
Registering a DBA is primarily for branding and marketing, as it allows a business to operate under a name that is more memorable, descriptive, or creative than its legal name.
3. Certificate Of Fact
The fee for obtaining a Certificate of Fact is $50. In Washington, D.C., a Certificate of Fact is a document that verifies the existence and status of a business entity registered with the Department of Consumer and Regulatory Affairs (DCRA).
A Certificate of Fact may be required for various purposes, such as for legal or financial transactions, to obtain specific licenses or business permits, or to satisfy a request from a third party that requires proof of a business entity's existence and status.
To obtain a Certificate of Fact, a business owner or authorized representative must submit a written request to the DCRA and pay the required service fee.
The request must include the business entity's DC LLC name, registration number, and the specific information that needs to be verified.
4. EIN
EIN stands for Employer Identification Number, a unique nine-digit number the Internal Revenue Service (IRS) assigns to identify a business entity for tax purposes.
In Washington, D.C., obtaining an EIN is free of charge and can be done online, by mail, fax, or by phone.
Business owners must obtain an EIN if they hire employees, operate as a partnership or corporation, file certain tax returns, or engage in other specific business activities.
To apply for an EIN, a business owner or authorized representative must provide certain information about the business, such as the legal name, mailing address, and business entity type.
5. Operating Agreement Fee
The operating agreement fee for an LLC in Washington, D.C., is $0, as there is no requirement to file an operating agreement with the DCRA.
An operating agreement is a document that outlines the rules and regulations governing your LLC's management and operation.
It is highly recommended that all LLCs have operating agreements to protect the members' interests and to establish the business structure.
While there is no official operating agreement fee in Washington, D.C., the cost of creating one can vary depending on how you draft it.
Costs Of Registering A Foreign LLC In Washington D.C.
When expanding your business to Washington, D.C., it’s essential to understand the costs associated with registering as a foreign Limited Liability Company.
From filing fees to ongoing LLC annual report expenses, here is an in-depth analysis of the costs you can expect to encounter when registering a foreign LLC.
1. Application Fee
Registering a foreign LLC in Washington D.C. requires a $220 application fee which must be paid to the District of Columbia Department of Consumer and Regulatory Affairs (DCRA). This fee is non-refundable, and failure to pay this fee may result in the application being rejected.
2. Certificate Of Good Standing
Before registering as a foreign LLC, you obtain a Certificate of Good Standing (also known as a Certificate of Existence) from the state or country where your LLC was initially formed.
The cost of this certificate varies depending on the jurisdiction but typically ranges from $25 to $125.
While not a requirement, some foreign LLCs may hire professional services, such as legal or accounting assistance, to help navigate the registration process and ensure compliance with all applicable laws and regulations.
FAQs
Are There Any Ongoing Fees To Maintain An LLC In Washington, D.C.?
Yes, LLCs in Washington D.C. must file an Annual Report with the Department of Consumer and Regulatory Affairs (DCRA) and pay a $300 fee.
How Long Does It Take To Form An LLC In Washington, D.C.?
The processing time for LLC formation service in Washington, D.C., varies, but it typically takes 3-5 business days for standard processing. Expedited processing is also available for an additional fee.
Do I Need A Physical Office In Washington, D.C. To Form An LLC There?
No, you don't need a physical office space in Washington, D.C., to form an LLC there. You can use a D.C. registered agent.
What Are The Benefits Of Forming An LLC In Washington, D.C.?
Benefits of forming an LLC in Washington D.C. include personal and business assets protection, pass-through taxation, flexible management structure, and raising capital by selling LLC ownership interests.
Do You Need Professional Help With Your Washington D.C. LLC?
Seeking professional help to set up an LLC in Washington D.C. is generally recommended to ensure compliance with legal requirements and avoid potential issues in the future.
If complying with all the requirements for establishing a formal business entity seems daunting, you can turn to these best LLC formation services in Washington D.C., for help with the entire process.
These services cover everything, from creating your company to ensuring you meet all regulatory requirements.
Furthermore, their expert team in business formation can handle a range of tasks, such as drafting your Articles of Organization and organizing the submission of your required legal business documents with the Washington D.C. Secretary of State.
References:
- https://www.sos.wa.gov/sites/default/files/2022-09/12.10.2020---certificate-of-formation---wa-llc.pdf?uid=641b5270e7784
- https://www.sos.wa.gov/sites/default/files/2022-09/12.10.2020---amended-certificate-of-formation---wa-llc.pdf?uid=641b5270e8615
- https://www.sos.wa.gov/sites/default/files/2022-09/certificate-of-dissolution---washington-limited-liability-company-and-pllc....pdf?uid=641b5270ea614
