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How to Form an LLC in Washington D.C.
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Affordable investment starting at $99 to set up your limited liability protection.
This guide to starting an LLC in Washington D.C. provides step-by-step instructions on filing formation documents, obtaining tax IDs, and setting up company records.
Overview
LLCs are the most popular business structure because they are inexpensive to form, provide flexibility to the owners, and are easy to run. Forming your LLC legally establishes your business, limits your personal liability, and gains tax flexibility. The following step-by-step will help you as you undertake this process.
Fast Facts: Your Budget and Timeline
Here is an overview of the total paperwork, cost, and time it takes to form an LLC in Washington D.C.. Be sure to read the final step in this guide - "Ongoing Filings" - to understand your ongoing costs to maintain a compliant Washington D.C. LLC.
- Form DLC-1: Articles of Organization for Domestic Limited Liability Company
- Operating Agreement
- IRS Form SS-4: Obtain an EIN
- Form FR-500: Combines Business Tax Registration
- D.C. Business License
- Initial Report
- FinCEN Beneficial Ownership Report
- Formation: $220 + optional $50-$100 expedite fee
- D.C. Business License: varies
- Initial Report: $300
- Formation: ~3-4 weeks by mail. ~10 business days online. ~3 business days for $50 expedite fee. ~1 business day for $100 expedite fee. In-person documents are expedited and processed same-day.
Step-by-Step Washington D.C. LLC Instructions
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Check Name Availability
The legal name of your LLC may not conflict with any other registered name. Check availability of your desired name by conducting a name search.
Name Search: District of Columbia Department of Licensing and Consumer Protection - Business and Professional Licensing Administration - Corporations Division
Name searchName Reservation: Optional Suffix: The name of a limited liability company other than a professional limited liability company shall contain the words "limited liability company" or "limited company" or the abbreviation "L.L.C.", "LLC", "L.C.", or "LC". The name of a professional limited liability company shall contain the words "professional limited liability company" or the abbreviation "P.L.L.C." or "PLLC". "Limited" may be abbreviated as "Ltd.", and "company" may be abbreviated as "Co.".
D.C. Code §29-103.02(f) -
Appoint a Registered Agent
Before you officially file to create your Washington D.C. LLC, you will need to decide who your Washington D.C. registered agent will be. A registered agent is a business's legal appointee to receive notice of lawsuit and other legal or government notices.
State law requires every LLC to have a registered agent. The registered agent is designated when you file Washington D.C. articles of organization with the District of Columbia Department of Licensing and Consumer Protection - Business and Professional Licensing Administration - Corporations Division.
Our reliable registered agent service fulfills this requirement. You get:
- Same-day documents from our local office in Washington
- Immediate online access to state forms with our address and, where required, our signature
- Annual fees from $89 to $99 per state with no additional charges
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File Washington D.C. Certificate of Formation
File the articles of organization to create your limited liability company.
Agency: District of Columbia Department of Licensing and Consumer Protection - Business and Professional Licensing Administration - Corporations Division Form: Articles of Organization for Domestic Limited Liability Company DLC-1
Filing Method: Mail, in-person, or online.
Agency Fee: $99 + optional $50-$100 expedite fee
Turnaround: ~3-4 weeks by mail. ~10 business days online. ~3 business days for $50 expedite fee. ~1 business day for $100 expedite fee. In-person documents are expedited and processed same-day.
Law: -
Establish Company Records
Your LLC must keep correct and complete books and records. Your filed articles of organization are the first documents for your LLC’s records. Your LLC will generate many other official records such as:
- Meeting minutes
- Operating agreement
- EIN verification letter
- Amendments and other filings made to the LLC throughout its lifetime
Organizations need a secure, centralized tool for managing and accessing sensitive records. Our Records Manager software offers a simple, efficient way for LLCs to store records, track members and managers, and customize meeting notifications.
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Create the Operating Agreement
Draft an Operating Agreement (potentially using a template) which is the governing document for the LLC. It defines the formalities of how the LLC will run itself such as holding an annual meeting. You will review and adopt the agreement at your organizational meeting.
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Hold the Organizational Meeting
The first meeting of the members of the LLC is the organizational meeting. You will need your filed articles of organization and your operating agreement in order to conduct this meeting. Keep minutes of this meeting and store them in your company record book.
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Get a Federal Employer Identification Number (EIN)
If your LLC has more than one member or will hire employees, it must obtain an EIN. An EIN is also often required to open a bank account.
Agency: Internal Revenue Service (IRS) Form: Instructions: Applying for an EIN without a SSN/TIN:
- Online applications are not accepted if an individual does not have a SSN/TIN.
- Form SS-4 must be completed, signed, and faxed to the IRS, leaving the SSN/TIN field blank or adding the terminology "foreign" to that line item.
- To follow up on the application, call the IRS and ensure they received the application.
- Depending on the agent you speak with, you may be able to obtain the EIN over the phone. The IRS may then fax the EIN documentation back to you.
Filing Method: Mail, phone, fax, or online.
IRS fee: $0
Turnaround: Immediately online or by phone. 4 business days by fax. 4-5 weeks by mail.
Notes: The IRS website is only available during certain hours. Print your EIN before closing your session. For additional guidance, see IRS Pub 1635: Understanding Your EIN.
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Get Washington D.C. State Tax Identification Numbers/Accounts
The District of Columbia offers a consolidated state tax registration application.
- Submit to:
- District of Columbia - Office of Tax and Revenue
http://otr.cfo.dc.gov/ - Form:
- Form FR-500: Combines Business Tax Registration
- Fee:
- $0
- Filing Method:
- Mail or online
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Report Beneficial Ownership Information to FinCEN
As of January 1, 2024, millions of entities in the US need to report beneficial ownership information (BOI) to the Financial Crimes Enforcement Network (FinCEN) as part of the Corporate Transparency Act (CTA). LLCs formed before that date must submit BOI before January 1, 2025, while those formed after must submit it within 30 days of formation.
Our BOI reporting service completes the initial filing and provides support for updating your information going forward. We will:
- Submit your beneficial ownership filings to FinCEN
- Handle initial filing, updates, and changes as needed
- Ensure compliance with BOI reporting requirements for $149 per year
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Consider Electing S-Corp or C-Corp Taxation
By default, your LLC receives pass-through taxation and the vast majority of LLCs keep this tax classification. Some LLCs benefit from electing S-Corp or C-Corp tax treatment:
- S-Corp treatment can help owner-employees who earn more than ~$75,000 per year save on self-employment taxes. File Form 2553: S-Corp Election.
- C-Corps suffer from double taxation: the corporation pays taxes on profits then members pay taxes on their distributions. If profits exceed $250,000 per owner, you provide employee benefits, or you will re-invest most of your profit in the business, you may benefit from the low tax rates on retained earnings under C-Corp treatment. File Form 8832: C-Corp Election.
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Obtain Business Licenses & Permits
To run your business legally, you must obtain applicable licenses and permits. The easiest way to navigate the wide range of federal, state, and local requirements is to search by your business type and locality using the Small Business Administration Business License & Permit look-up tool.
District of Columbia Basic Business License - General Business
Agency: District of Columbia Department of Licensing and Consumer Protection - Business and Professional Licensing Administration - Business Licensing Division Law: Notes: Businesses that have a basic business license in a different classification than the general business license typically do not need a general business license as well. Only businesses with elevator, retail cigarette, patent medicine, food product, or vending machine classifications will need to apply for the additional general business license. Nonprofit organizations generally hold a charitable solicitation license instead of a general business license.
To obtain a general business license, the organization must:
- foreign qualify
- obtain a tax registration or exemption
- obtain their certificate of clean hands
- obtain a certificate of occupancy if they have a physical presence in the district
- apply for the general business license
What is “Clean Hands”? (DC Code § 47-2862)
During the Basic Business License application process, all applicants must certify that no more than $100.00 is owed to the District of Columbia Government as a result of fees, penalties, interest, or taxes. This must be obtained in one of two ways:- If you are a District of Columbia individual or business taxpayer, you must log-in to your MyTax.DC.gov account to generate the request. If you do not have a MyTax account and are required to pay District of Columbia taxes (business or individual), you must first create a MyTax.DC.gov account. Once the account has been created, you can utilize the self-service feature to execute the request.
- If you are not required to pay District of Columbia taxes and require a Certificate of Clean Hands, a manual request can be requested here.
In either case, the Certificate of Clean Hands will expire 90 days from the date of issuance.
Automatic Exemption
Exemption Eligible Organizations: - Entities that have an endorsement under a different license endorsement category
- Entities comprised of principals who are required to maintain licenses granted or regulated by a local, state, or national certification board or body
Law: Initial Registration
Filing Method: Agency Fee: $99
Turnaround: Immediate
Registration Renewal
Filing Method: Agency Fee: $99
Due: - Biennially by the end of the month prior to the registration anniversary month.
- Renewals can be filed as early as 75 days prior to the expiration date.
Penalties: Penalty fees accumulate as follows:
- $250 starting 1 day after the expiration date
- $500 starting 1 month after the expiration date
- $500 + an additional fee based on the license fee starting 6 months after the expiration date. The license also becomes ineligible for renewal and a new application must be filed.
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Ongoing Filings to Maintain Your LLC
You must file federal and state tax returns.
Many states also require business entities to file an annual report to maintain good standing with the secretary of state. If an annual report is required for LLCs formed in Washington D.C., view the table below.
Washington D.C. Corporation Annual Report Requirements:
Agency: District of Columbia Department of Licensing and Consumer Protection - Business and Professional Licensing Administration - Corporations Division Form: BRA-25: Two-Year Report for Domestic and Foreign Filing Entity
Filing Method: Mail, in-person, or online.
Agency Fee: $300. $100 expedite fee is required if delivering in-person.
Turnaround: 15 days for Mail or Online filings; Fee of $100 for one day service or $50 for 3 day service for In-person filings.
Due: The first report is due April 1 in the calendar year after registration. After the first filing, reports are due biennially by April 1. Reports may be filed as early as January 15.
Law: Penalties: $100 late fee.
Notes: - An officer, director, manager, member, or agent may file.
- File online and pay by credit card. Print the confirmation page for your records.
For more details, see our Washington D.C. annual report information center page.
As your LLC grows, you will need to demonstrate your company’s good standing to banks, customers, and other state agencies. After all the work involved in forming your Washington D.C. LLC, don’t let a missed annual report filing cause your new business to fall out of compliance.
Tracking and filing annual reports on your own can be time consuming and lead to accidental lapses. Protect your LLC’s good standing with Managed Annual Report Service, which tracks and automatically files reports on time, every time, so you can focus on your business.
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