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How much does an LLC cost in Washington DC cost?
Forming an LLC in Washington DC costs $99, but that’s just the filing fee for the Articles of Organization. What about the other costs to form a Washington DC LLC?
Besides the $99 filing fee, there are a few other costs to consider before forming an LLC in Washington DC.
Ongoing LLC costs in DC include the Certificate of Occupancy or Home Occupation Permit, your Basic Business License, and your LLC’s Biennial Report.
Need to save time? Hire a company to form your LLC:
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The table below shows all the fees for forming an LLC in Washington DC. Further below in the article, you’ll find more detailed explanations of each cost.
Washington DC Limited Liability Company Costs:
| Requirements | Cost |
|---|---|
| LLC Name | $0 |
| Registered Agent | $0 or $125 per year |
| Articles of Organization | $99 |
| Tax Registration | $0 |
| Certificate of Occupancy or Home Occupation Permit | $72.60 |
| Basic Business License | $200 - $500 (every 2 years) |
| Operating Agreement | $0 |
| EIN Number | $0 |
| Biennial Report | $300 (every 2 years) |
| Taxes | Varies (paid each year) |
District of Columbia LLC Name ($0)
There is no cost associated with naming your DC LLC. You are not required to file a Name Reservation or anything like that.
You’ll simply just enter your desired DC LLC name on the Articles of Organization. Once the Department of Licensing and Consumer Protection (DLCP) approves your filing, your Washington DC LLC name goes into existence. You don’t need to file anything extra or pay any additional fees for the name.
Washington DC Registered Agent ($0 or $125/year)
Washington DC law requires that you designate a Registered Agent when forming your LLC. However, there is no additional filing fee (no “registered agent fee”) to list a Registered Agent on your Articles of Organization.
A DC Registered Agent is a person or company who receives legal documents and state notices for your LLC. A Registered Agent needs a street address in the state and should generally be available during normal business hours.
There is no additional cost if you will be your own Registered Agent, or have someone you know be your LLC’s Registered Agent. This could be one of your business partners, or a friend or family member.
However, you have the option of hiring a Registered Agent service. This will cost you between $100 to $300 per year. But Registered Agent service companies offer other helpful business services and can protect your privacy.
Hiring a Registered Agent service is a good idea if:
- You don’t have an address in the state (DC law requires Registered Agents to have a physical address in the state)
- You want to keep your address off public record (depending on which company you hire, you may be able to use their address to keep your address private)
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District of Columbia LLC Articles of Organization ($99)
Forming an LLC in DC requires filing the District of Columbia Articles of Organization.
This can be filed online and the cost is $99 (and this is a one-time filing fee).
We recommend filing this online since it’s much easier (and has a faster approval time) than filing your Articles of Organization by mail.
Note: The cost for forming a Washington DC LLC online and by mail are the same; they are both $99.
Once your LLC is approved, the DLCP will send you a stamped and approved copy of your Articles of Organization as well as a Certificate of Organization with the official DC seal. If you filed your LLC online, you’ll be able to download these documents from within your CorpOnline account.
Washington DC Tax Registration ($0)
Once your Washington DC LLC is approved, you must register for taxes with the Office of Tax & Revenue (OTR). The form to Register for Taxes is called the FR-500.
There is no cost associated with this tax registration ($0).
Certificate of Occupancy or Home Occupation Permit ($72.60)
Every Washington DC LLC must have either a Certificate of Occupancy or a Home Occupation Permit.
A Certificate of Occupancy is used for a commercial building and a Home Occupation Permit is used for a residential building.
If you’re renting office space you can most likely use the Certificate of Occupancy that’s already in place for the building, but if you’re developing a new commercial space or you already own a commercial building, then you’ll need to apply for your own Certificate of Occupancy.
The cost for a Certificate of Occupancy starts at $72.60. However, it may cost more depending on the square footage of the building.
If you’re going to run the LLC from your business from home, you will need a Home Occupation Permit. The cost for a Home Occupation Permit is $72.60.
Both the Certificate of Occupancy and Home Occupation Permit are one-time fees. Meaning, you don’t need to renew them every year.
You only need to get a new Certificate of Occupancy if you purchase or move to a new building. And you only need to get a new Home Occupation Permit if you move or change the purpose of your business.
District of Columbia LLC EIN Number ($0)
An EIN Number is also known as an Employer Identification Number (EIN), Federal Tax Identification Number, or a Federal Employer Identification Number (FEIN).
This number is used to file income taxes, to open an LLC bank account, and to hire employees (if applicable).
Although many websites charge a service fee to get an EIN for your LLC, it can actually be done for free.
You can obtain an EIN for your LLC from the Internal Revenue Service (IRS) website at no cost. The online filing can be completed in a few minutes.
Basic Business License (varies, paid every 2 years)
Every Washington DC LLC also needs to get a DC Basic Business License (BBL). This LLC cost varies depending on what your company does, so we can’t say exactly what you’ll pay.
The type of BBL you get depends upon your LLC’s “endorsement category”. This is a fancy term DC uses, but it just means the category of business activities your LLC does.
Some Basic Business License endorsement categories cost as little as $150 every 2 years and some can be as high as $500 every 2 years. Again, it all depends on the endorsement category that applies to your Washington DC LLC.
Note: Before you can apply for a Basic Business License, your LLC must:
- be approved by the DLCP
- get an EIN Number from the IRS
- register for taxes with the OTR
- have a Certificate of Occupancy or Home Occupation Permit
Washington DC LLC Operating Agreement ($0)
A District of Columbia LLC Operating Agreement is a written contract between the LLC Members. Operating Agreements include detailed information about LLC ownership, how the LLC is managed, and how profits are distributed.
Single-Member LLCs and Multi-Member LLCs should draft an Operating Agreement, keep it with their business records, and give a copy to each Member.
Most websites charge $50 to $200 for LLC Operating Agreements.
Here at LLC University®, we offer free Operating Agreement templates for all types of LLCs.
Washington DC LLC Biennial Report ($300 every 2 years)
All LLCs in Washington DC need to file a Biennial Report, which is due every 2 years. The fee for a Biennial Report is $300.
The LLC Biennial Report must be filed in order to keep your LLC in good standing within the District.
Note: In other states, LLCs may be required to file Annual Reports every year. In DC, it’s only required every other year (every 2 years).
District of Columbia LLC Taxes (varies)
There are many different types of taxes that business owners must pay. Federal taxes (like federal income tax), DC taxes, franchise tax, payroll tax (if you have employees), sales tax, and more.
How much you’ll pay in taxes can be determined by working with a qualified accountant in the District.
The amount you’ll pay your accountant will vary, but most accountants will cost between $400 to $900 per year.
Washington DC LLC Total Filing Cost
The DC LLC cost (the cost to create the LLC) is $99. You’ll also pay $72.60 (one-time fee) for a Certificate of Occupancy or a Home Occupation Permit. And you must get a Basic Business License, the cost of which depends on what industry/occupation your LLC operates in.
Washington DC LLC Recurring Costs
The recurring costs are the following, due every 2 years:
- $300 for the LLC Biennial Report
- $200 – $500 for the Basic Business License Renewal
Additional Costs
$125 (per year) if you hire a Registered Agent in Washington DC (but if you or a friend/family member are the Agent, there is no cost ($0).
And of course there’s taxes, which include the amount you pay in taxes and how much you pay your accountant for their services. This will vary quite a lot and we’re not able to provide an estimate. You’ll need to speak to a few accountants regarding your business.
District of Columbia Department of Licensing and Consumer Protection
If you have questions about the cost of an LLC in Washington DC, you can contact the Department of Licensing and Consumer Protection.
Note: Before 2022, this department was called the Department of Consumer and Regulatory Affairs in DC.
District of Columbia LLC Cost FAQs
How much does it cost to open an LLC in Washington DC?
It costs $171.60 plus the cost of the Basic Business License to start an LLC in Washington DC. This is a one-time filing fee for the LLC Articles of Organization ($99) plus the fee to obtain the Home Occupation Permit or Certificate of Occupancy ($72.60).
All DC LLCs need a Basic Business License, but the cost varies on what type of business your LLC does. So the total cost of starting a District of Columbia LLC is at least $171.60, plus the cost of your LLC’s BBL.
And depending on what your LLC does, you may need to obtain business insurance. The cost of this varies.
How much does an LLC in the District of Columbia cost per year?
There are no annual fees in Washington DC. However, there are two types of bi-annual fees (costs that are paid every 2 years).
All Washington DC LLCs need to pay $300 every two years for the Biennial Report. All District of Columbia LLCs have to pay ongoing fees for Biennial Reports to remain in good standing.
Your Washington DC LLC Basic Business License must be renewed every two years. So you’ll pay the business licenses fee every two years, also. Remember, this fee varies depending on what type of business your LLC does.
If you hired a Registered Agent service, you’ll have an annual subscription fee to pay each year. This is usually about $125 per year.
Should I hire an LLC formation service?
You aren’t required to hire a professional service company to form your District of Columbia LLC. You’re allowed to form your LLC yourself if you’d like. If you do it yourself, you’ll only pay the Washington DC LLC filing fee, not any service fees to a filing company.
However, if you want to save time and make sure your LLC is filed correctly, we recommend hiring Northwest Registered Agent.
Northwest Registered Agent has excellent customer service and they include Registered Agent services free for the 1st year. They also offer other services, like an Operating Agreement and filing your Annual Report.
Check out Best LLC Services for more suggestions.
Do I need to hire an attorney to form an LLC?
No, you aren’t required to hire an attorney to form your District of Columbia LLC. You’re allowed to complete the LLC formation process yourself if you’d like.
However, some people may want to hire an attorney if their LLC has a complex ownership or management structure, has investors, or requires industry-specific documentation.
A business attorney usually charges between $800 and $2,500 to form an LLC (we can’t say for sure what the minimum fee would be, since every attorney charges differently).
How do I start an LLC in Washington DC?
Here are the steps to starting an LLC in the District of Columbia:
- Choose an LLC business name and make sure it’s available
- Choose who will be your DC Registered Agent
- File the District of Columbia LLC Articles of Organization
- Complete and sign an Operating Agreement
- Get a Tax ID Number (EIN) from the IRS
- File your DC LLC Tax Registration
- Obtain a Certificate of Occupancy or Home Occupation Permit
- Get the DC Basic Business License
- Open an LLC bank account
What’s the cheapest way to start District of Columbia LLCs?
You can get an LLC cheaply by filing your formation documents yourself. You’ll also save money by being your own Registered Agent, and using our free LLC Operating Agreement template.
By forming your LLC yourself, being your own Registered Agent, and using our Operating Agreement template you can save over $400.
How long does it take to get an LLC in Washington DC?
How long it takes to get an LLC in the District of Columbia depends on how you file your Articles of Organization.
You can get an LLC in Washington DC approved in 5 business days if you file online. On the other hand, filing by mail takes about 2-4 weeks (plus mail time).
How much does a District of Columbia business bank account cost?
It varies. Some banks charge monthly fees ($10 to $20 per month), but these can sometimes be avoided by meeting certain requirements. For example, if you make a certain number of direct deposits or maintain a specified minimum balance, then they’ll waive the monthly fees.
And you might be able to find a bank that doesn’t charge any monthly fees.
Before you open your LLC business bank account, we recommend calling and asking if there are ways to avoid the monthly maintenance fees.
How much is a Foreign LLC in Washington DC?
A Foreign LLC is an LLC formed in another state that must register (aka Foreign Qualify) in Washington DC. This is because the LLC is doing business in both states.
The District of Columbia Foreign LLC cost is $99. This is the fee to register an LLC in DC after it’s been formed in another state.
If you form an LLC in Washington DC, it is called a “Domestic LLC”. If you formed your LLC in another state, it would be a Foreign LLC once you register it in the District of Columbia.
Is Washington DC a good state for an LLC?
The most important factors in deciding where to start a business are where you live and where you’re doing business.
Meaning, if you live in or do business in Washington DC, then you should start your business in Washington DC. While many websites talk about tax rates and advantages of certain states, none of that applies if it’s not the state where you live and do business. And just because a certain state has cheaper LLC fees doesn’t mean it’s a good idea to form your LLC there.
For example, if you form an LLC in Delaware, but live in and conduct business in Washington DC, you’ll also need to register your Delaware LLC in Washington DC (and pay fees). And you’ll end up paying Washington DC taxes anyway. This ends up leading to more costs and more headaches with no advantages.
In summary, if you are a Washington DC resident, then yes, Washington DC is the best state to form an LLC. If you don’t live in and do business in Washington DC, then no, Washington DC probably isn’t a good state to start an LLC.
References
DLCP: Business Registration FAQ
DLCP: Domestic Limited Liability Company
Code of DC: Chapter 8 Limited Liability Companies
Code of DC: Subchapter VI. Administrative Dissolution
DLCP: Corporations Division Fees – Limited Liability Company
Matt holds a Bachelor's Degree in business from Drexel University with a concentration in business law. He performs extensive research and analysis to convert state laws into simple instructions anyone can follow to form their LLC - all for free! Read more about Matt Horwitz and LLC University.
District of Columbia LLC Guide
Looking for an overview? See District of Columbia LLC
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