Last updated January 7, 2021

Washington State LLC
Business License

Quick Start Guide
This Quick Start Guide is a brief overview of how to form an LLC in Washington.

Detailed Lessons:

 

Washington LLC Costs:
Washington LLC state filing fee: $200
Washington LLC annual report fee: $60

Need help?
Hire a reliable service to form your Washington State LLC:
Northwest ($39 + state fee) or LegalZoom ($149 + state fee)

★ Check out Northwest vs LegalZoom

↓ Jump to the Business License Application

What is the Washington State Business License (aka “bulk registration”)?

All LLCs in Washington must get a State Business License.

The term “Business License” can be a little confusing, because in addition to being a business license, it’s also a “bulk registration“.

Meaning, after you complete the Business License Application, the following things happen:

(Below is an overview of what occurs after completing the Business License Application. Each item is discussed in greater detail further down the page.)

1. Your LLC gets a State Business License

The State Business License is issued by the Washington Department of Revenue and it grants your LLC the ability to do business in the State.

2. Your LLC gets a City Business License (depends on the city)

If your town or city has partnered with the Washington Department of Revenue, then you can also obtain your LLC’s City Business License at the same time. The City Business License grants your LLC the ability to do business in the city or town in which it will operate.

If your city or town has not partnered with the Washington Department of Revenue, then it likely partnered with FileLocal. If your city or town partners with FileLocal, then you can’t get a City Business License at the same time as your State Business License.

Instead, you’ll have to go through FileLocal after your LLC is approved. FileLocal is typically used by cities in the Puget Sound region.

3. Your LLC gets a Specialty Business License (if applicable)

  • Tip: Another way to think of the Specialty Business License is as a “Regulatory Business License”.

LLCs which engage in business activities that pose more risk to the public or are more heavily regulated will need to get a Specialty Business License in addition to the State Business License.

The Specialty Business License can be obtained at the same time as the State Business License.

Some examples of regulated business activities are: selling liquor and alcohol, operating vehicles-for-hire, lottery retail, and travel services.

If your LLC does not engage in these types of activities, then it will not need a Specialty Business License.

4. Your LLC can get a Trade Name/DBA (not required)

  • Tip: Most people mistakenly think that their LLC needs a DBA (Doing Business As) Name. This is not true. Please see Does my LLC need a DBA?

Typically in most states, if your LLC wants to use a DBA (Doing Business As) Name, they need to make a separate filing with the Secretary of State office or the County Clerk.

Things are done differently in Washington. First, a DBA Name in Washington is called a Trade Name.

Second, Trade Names aren’t filed with the Secretary of State or the County Clerk in Washington, but instead, they are filed with the Department of Revenue and it’s “baked into” the Business License Application.

If you want your LLC to use a Trade Name – (aka DBA or Doing Business As) – you will need to apply for that Trade Name during the Business License Application.

5. Your LLC gets registered for taxes with the Washington Department of Revenue (“Tax Registration Endorsement”)

As part of the Business License Application, your LLC will get registered for taxes with the Washington Department of Revenue.

While Washington has no personal income tax or corporate income tax, Washington State (and many cities) charge a Business & Occupation Tax (B&O) tax.

Additionally, your LLC may need to collect Sales & Use Tax. Sales & Use Taxis typically charged for selling tangible personal property, however, there are also some services that pay sales tax in Washington.

6. Your LLC gets registered with the Washington Department of Labor & Industries (if you’ll have employees)

If your LLC will hire employees in Washington, your LLC will get registered with the Washington Department of Labor & Industries (L&I).

L&I administers the workers’ compensation system. Workers’ compensation is an insurance program that pays compensation to employees who suffer job-related injuries or illnesses.

7. Your LLC gets registered with the Washington Employment Security Department (if you’ll have employees)

If your LLC will hire employees in Washington, your LLC will get registered with the Washington Employment Security Department (ESD).

ESD administers the registration of employees, filing of quarterly wage reports, and the payment of unemployment insurance taxes.

Washington State Business License Fee

The Washington State Business License costs $90. This is a one-time fee.

In order to get a State Business License for your Washington LLC, you must complete the Business License Application.

There is no annual renewal for the State Business License. The State Business License never expires.

I read somewhere that the State Business License costs $19?

The Business License Application used to cost $19, however, that changed in July 2020.

Substitute Senate Bill 6632 amended RCW 19.02.075 and changed the Business License Application fee from $19 to $90.

The Washington Department of Revenue has updated their variable business license fees page to reflect the new $90 fee.

But it says the $90 fee is for “opening the first location” on that page? My business won’t have a storefront.

That language can be a bit misleading.

It doesn’t matter if your business has a physical location (ex: storefront or office) or if it doesn’t have a physical location (ex: online business or working from home). The way to apply for a State Business License is by “opening” a location. Said another way, regardless of the type of business you have, you still need to obtain a State Business License for your Washington LLC and pay the $90 application fee.

City Business License & Specialty Business License

In addition to getting a State Business License for your LLC:

  • most LLCs need a City Business License (aka “City Endorsement“)
  • and some LLCs need a Specialty License (aka “Specialty Endorsement“)

The City Business License and the Specialty Business License have associated fees. However, unlike the State Business License which doesn’t need to be renewed (it exists forever), both the City Business License and the Specialty Business License need to be renewed every year.

Note: The official terms are actually “City Endorsement” and “Specialty Endorsement”, however, we prefer to use the terms City Business License and Specialty Business License as they are easier to understand.

City Business License (“City Endorsement”)

Notes:

  • For licensing purposes, cities and towns are both called “cities”.
  • City Business License, City Endorsement, and City General Business License are all the same thing.
  • There are 3 “types” of cities in regards to the Business License: (1) those that have partnered with the Department of Revenue, (2) those that have partnered with FileLocal, and (3) those that have not partnered with a “combined licensing system” yet, but will have to by 2023.

In addition to the state of Washington requiring a State Business License, most cities and towns in Washington also require LLCs to obtain a City Business License.

For example: If your LLC is doing business in Granite Falls, it needs a Granite Falls City License. This license costs $45 initially. And then $45 each year.

Combined licensing system: Department of Revenue vs. FileLocal

There is a law in Washington (RCW 35.90) that requires all cities to join a “combined licensing system“. This means that most cities (except a handful) partner with the Washington Department of Revenue and let the Department of Revenue handle the filings for City Business Licenses.

So when you’re getting the State Business License for your LLC, you can also get the City Business License for your LLC (depending on the city where your LLC is doing business and whether or not that city has partnered with the Department of Revenue (DOR).

For a list of cities that have partnered with the DOR, please see here:
Washington Department of Revenue: City License Endorsements

As of early 2021, a handful of cities have not partnered with the Washington Department of Revenue, but instead use another “combined licensing system” called FileLocal. FileLocal is a joint organization formed by several large cities in the Puget Sound region.

Here are the list of cities that have partnered with FileLocal:

  • Bellevue
  • Bremerton
  • Des Moines
  • Everett
  • Lake Forest Park
  • Renton
  • Seattle
  • Shoreline
  • Snoqualmie
  • Tacoma

If your LLC will be located in any of these cities:
If your LLC does business in any of these cities or your home address is located in any of these cities, then you can’t get a City Business License through the Business License Application (you still must complete the Business License Application though). Instead, you need to create an account with FileLocal to register your LLC for a City Business License.

What if my city/town hasn’t partnered with DOR or FileLocal?

If your city or town isn’t listed on the City License Endorsement page of the DOR or the Tax Office Contact Information page of FileLocal (click the drop down list), then you’ll need to call your city/town and ask if a City Business License is required and ask for instructions.

An important thing to note is that by 2023 all cities that have a City Business License requirement will need to partner with the Department of Revenue. So if you need to obtain a business license manually in 2021 or 2022, please keep in mind that this will change in 2023.

You can find contact information for every city and town in Washington here:
Access Washington: License and Tax Information for Cities and Towns

What address or location determines the city?

The City Business License requirements are determined by where your LLC is conducting business in Washington. For example, if your LLC runs a gym, then your LLC is conducting business in the city where the gym is located. If your LLC runs an online business, then your LLC is conducting business in the city where you operate and run the business from.

What if my LLC does business in multiple cities?

If your LLC does business in multiple cities, you’ll need to get a City Business License for each city where your LLC is doing business.

What if my LLC hired Northwest Registered Agent and I’m using their address as my business address?

If you hired Northwest as your Washington Registered Agent and you are using their address throughout your Washington LLC Certificate of Formation for address privacy, you can carry that privacy over to the Business License Application.

The reason for some people doing this is because Business License information is on public records (see Washington Department of Revenue: Business Lookup).

Northwest’s address is located in Spokane. So if you use Northwest’s address as the physical address on your Business License Application, you’ll need to get a City Business License in Spokane. And if your LLC owes any city-level taxes, those will also get filed in Spokane.

What about for an online business (or home-based business)?

If you have an online business and you run that business from home, then your LLC is doing business in the city where your home is located. If you don’t want to use your home address, your other alternatives are to use the address of Northwest Registered Agent or use the address of a virtual office. On the other hand, if you have an online business, but have an office with employees, then your LLC is doing business in the city where your office is located.

What if I live in Georgia, but have an LLC in Washington?

If you have an LLC in Washington, but are doing business out of state (and not doing business in Washington), your LLC will need a State Business License, but it won’t need a City Business License. You’ll list your LLC’s out-of-state physical address during the Business License Application.

What if I’m a non-US resident that has an LLC in Washington?

If your Washington LLC isn’t doing business in Washington, you can use your home country as the LLC’s physical location. During the Business License Application, there is a Country drop down menu for Physical Business Address (screenshot). You can select your country from this list. In this situation, your LLC will get a State Business License, but it will not need a City Business License, since your LLC isn’t doing business in Washington.

Addresses that aren’t allowed in the Washington Business License Application:

The state doesn’t allow you to use a PO Box address. If your LLC has no physical location, you’ll need to use a home address, a virtual office address, or the address of your Commercial Registered Agent (if allowed).

Specialty Business License (“Specialty Endorsement”).

Note: The technical term is Specialty Endorsement, however, we will refer to it as the Specialty Business License, as we think it’s easier to understand.

Alright, let’s recap:

  • Your LLC needs to get a State Business License.
  • Your LLC needs to get a City Business License.

In addition to those, your LLC needs a Specialty Business License if it engages in certain business activities (mostly those which pose a risk to the public or customers).

Included in the Business License Application:

Unlike the City Business License – (where most cities are grouped into the Business License Application) – only a few Specialty Business Licenses are grouped into the Business License Application.

Here are the Specialty Business Licenses that are a part of the Business License Application:
WA Department of Revenue: State endorsements

Not included in the Business License Application:

Many industries that require a license are not grouped into the Business License Application. Instead, you must contact the respective state agency and ask for instructions.

For a list of all business activities that require a state license, please see here: WA State Department of Licensing: List of Licenses

How much does a Specialty Business License cost?

The Specialty Business License costs between $20 and $250 per year, depending on the industry.

This license fee must be renewed each year.

Trade Name (DBA) Registration

If you want your LLC to do business under a name that is different than its true and legal name, you’ll need to register a DBA (Doing Business As) Name in Washington.

DBAs are officially called Trade Names in Washington.

Unlike most other states where Trade Names are filed with the Secretary of State’s office, in Washington, Trade Names are filed as a part of the Business License Application.

A Trade Name in Washington only costs $5.

How to apply for a Washington State Business License

You can apply for your LLC’s State Business License online or by mail by completing the Business License Application.

The Business License Application is like a questionnaire.

You will answer a number of questions and submit information about your LLC.

LLC University® recommendation: We recommend using the online filing method. It’s easier to complete and the application is processed much faster.

Filing by mail

Filing by mail can take 6 weeks to process your Business License Application and the process is more complicated.

Note: If you choose to file by mail, you can answer the questions in the Business Licensing Wizard. Then at the end, click “By Mail” to download the applicable forms.

Filing online

Filing online takes 10 business days to process your Business License Application and the process is much easier than filing by mail.

The instructions and information below are only applicable to the online filing.

Washington State Business License Application (Online filing)

The Business License Application is filed online via MyDOR (“My Department of Revenue“).

However, in order to login to a MyDOR account, you must first create a SAW (Secure Access Washington) account.

You’ll be able to use your SAW username and password to login to multiple state agencies in Washington.

Note: If you have an old “DOR e-File” account, that login information will no longer work.

Find your LLC’s UBI Number

You’ll need the UBI Number from your LLC registration. You can look in the upper right corner of your LLC’s Certificate of Formation to find it.

Or you can use the Advanced Business Search and search your LLC name. You’ll see your LLC’s UBI Number listed in its online record.

Create a SAW account

If you don’t have a SAW account, you’ll need to create one:

  • Visit the SAW Sign Up page.
  • Enter your name and your email address.
  • Create a user ID and a password.
  • Agree to the terms and click “Register”.
  • For the final step, you’ll need to go to your email and find the activation code that the state sent you.

Login to MyDOR and start your Business License application

After creating your SAW account, you should be taken to the MyDOR Services page.

Click the green “Get Started” button. Then in the “Licensing Services” box, click “Apply for a Business License“.

Select “Start a Business in WA state” and enter the UBI Number for your LLC.

Employee vs Independent Contractor

During the Business License Application, you’ll be asked if you plan to hire employees.

If you’re going to hire people and aren’t sure if they are considered an employee or independent contractor, we recommend reading this helpful article: MDK Law: Employee vs. Independent Contractor.

The Employment Security Department also has a test to help determine whether someone is an employee or an independent contractor. Look at the “All other industries” section on this page: ESD: Independent contractors.

Generally speaking, an employee is someone you hire where you have control over how their work is done. Additionally, this person is usually only working for you and not also working for other businesses or clients.

On the other hand, an independent contractor usually doesn’t have their work controlled. They often work for other businesses or clients and they often use their own equipment. Their payment is based on the completion of tasks or projects (and not just paid to “put in time”). And they also pay their own employment taxes.

Note: The DOR’s definition of “employee” is different from many cities’ definition of “employee”. This is because some cities determine their City License price based on a “head count method”. In other words, many cities count everybody working in the business as an “employee” whether or not they are technically an employee. Additionally, the business owner will also count as an “employee” if a city uses the “head count method”.

We can’t walk you through the Business License Application filing:

Unfortunately, we cannot provide step-by-step instructions for the Business License Application.

This is because the answers depend on the facts of your business and it varies widely among our readers.

The Business License Application is fairly straightforward though and just asks a series of questions.

Thank you for your understanding.

If you need assistance:

Approval of your Business License and “Adding Access” in MyDOR

After submitting the Business License Application, the Department of Revenue will review your application and then:

  • Register your LLC for taxes with the Department of Revenue (technically known as a “Tax Registration Endorsement”)
  • Grant your LLC a State Business License
  • Grant your LLC a City Business License (if your city partnered with DOR)
  • Grant your LLC a Specialty Business License (if applicable)
  • Grant your LLC the use of a Trade Name (if applicable)

Within 7-10 business days, you’ll receive two items in the mail:

  1. Approved State Business License
  2. Filing Frequency Letter

What address are these sent to?

The above documents will be mailed to the “Mailing Address” you entered during your Business License Application.

What is listed on the approved State Business License?

Your approved State Business License is an official certificate for your LLC which includes information such as:

  • LLC name
  • LLC address
  • UBI Number
  • Governing People
  • City Endorsement (if your city partnered with DOR)
  • Specialty Endorsement (if applicable)
  • Trade Name (if applicable)

You won’t be getting a separate City Business License or Specialty Business License (if applicable). Those “endorsements” will be listed on your approved State Business License.

What is the Filing Frequency Letter?

The Filing Frequency Letter is a letter from the Department of Revenue which will let you know about your filing frequency obligations (ex: monthly or quarterly) for your LLC’s Excise Tax Return.

The Excise Tax Return is a “combined filing” return, which includes Sales & Use Tax, Business and Occupation Tax (B&O), and any other applicable taxes your LLC may be responsible for.

Also be on the lookout for any “Welcome Packets” that arrive in the mail from the Washington Department of Revenue which will explain Washington taxes in more detail.

We’ve also written about taxes in Washington here: Washington LLC taxes.

“Adding Access” to MyDOR

After your Business License is approved, you need to connect that information to your MyDOR account. This connection is called “Adding Access”.

In order to “Add Access” you’ll need the Letter ID which you can find on your Filing Frequency Letter.

It will look like this: Filing Frequency Letter example.

In order to Add Access, you need to login to MyDOR:

  • After you login, click the “Get Started” button.
  • Under the “Access” box, click “Add Access to Account”.
  • Add your Letter ID found in your Filing Frequency Letter.
  • Follow the prompts to finish “Adding Access” to your MyDOR account.

After “Adding Access”, you will see 3 new tabs in your MyDOR account (Summary, Action Items, and Other Options). This means you now have full administrative access to your MyDOR account.

Posting your Business License

You are required to post your approved Business License at your place of business. For example, if your LLC has a storefront or office location, your approved Business License must be posted that can easily be seen by a visitor or customer.

If you work from home, you can just keep your approved Business License with your business records. You don’t have to post it in your kitchen or anything like that.

Next Step: Washington LLC Taxes

After you’ve completed your Business License Application, as well as researched and obtained any additional licenses and/or permits for your Washington LLC, you can then proceed to the next lesson: Washington LLC Taxes.

References

Revised Code of Washington: Chapter 19.02
Revised Code of Washington: Section 19.02.010
Revised Code of Washington: Section 26.23.040
Revised Code of Washington: Section 50.04.145
Revised Code of Washington: Section 51.08.18
Revised Code of Washington: Section 51.08.180
Revised Code of Washington: Section 51.08.195
Revised Code of Washington: Section 51.12.020
Washington Administrative Code: Section 458-20-102
Business.WA.gov: Small Business Guidance (Run Your Business)
Access Washington: License and Tax Information for Cities and Towns
Municipal Research and Services Center: City Business Licenses and Fees
Washington Department of Revenue: Find a law or rule
Washington Department of Revenue: New Business Tax Basics
Washington Department of Revenue: Variable business license fees
Washington Department of Revenue: Renew or update business license
Washington Department of Revenue: Business Licensing and renewals FAQs
Washington Department of Revenue: Excise Tax Advisory (December 28, 2009)
Washington Department of Revenue: Register Trade Names
Washington Department of Labor & Industries: Claims
Washington Department of Labor & Industries: Help for Small Business
Washington Department of Labor & Industries: About Labor and Industries
Washington Department of Labor & Industries: L&I Business Requirements
Washington Department of Labor & Industries: Independent Contractor Guide (PDF)
Washington Employment Security Department: Unemployment Insurance Benefits FAQ
Washington Employment Security Department: Frequently asked questions on UI Benefits
Washington Employment Security Department: Unemployment taxes forms and publications

Matt Horwitz
Founder & Educator, LLC University®
Forming an LLC shouldn't be so complicated. Our step-by-step guide will make the process a breeze – and no complex legal jargon! LLC University® teaches people how to form an LLC for free in all 50 states. We hope you find our free guides and resources helpful in your business journey.
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