How to Start an LLC in Washington (2026 Guide)
Washington charges $180 to form your LLC — higher than many states — but has no personal income tax at all. That trade-off sounds simple until you learn about the B&O tax: a gross receipts tax owed on your total revenue, not your profit, even in a year you lose money.
To start a Washington LLC, file a Certificate of Formation with the Washington Secretary of State, Corporations & Charities Division for $180 (plus a $20 online processing fee, for $200 total online). Online filings typically process within about 5 business days; mail takes 2–4 weeks. You must also file an Initial Report within 120 days of formation — included free if you form online. Every LLC then files an Annual Report ($70), due the last day of your LLC's anniversary month. Washington has no personal income tax, but most LLCs owe the state's Business & Occupation (B&O) tax — a tax on gross receipts, not net profit, with no deductions for costs.
- State filing fee
- $180 (+$20 online) = $200 online
- Processing time
- ~5 business days online
- Annual Report
- $70 · due anniversary month
- Personal income tax
- None
- B&O tax
- Yes — on gross receipts, no deductions
- Small business B&O exemption
- Under $250,000 gross receipts (2026)
What to Know Before You Form in Washington
Washington's formation process is straightforward, but its tax structure genuinely differs from most states in this series. What's worth understanding clearly before you commit:
- A $180 formation fee — with a $20 online processing fee added, most founders pay $200 total to file online.
- No personal income tax — a real, genuine draw for many founders considering Washington.
- The Business & Occupation (B&O) tax — owed on gross receipts, not net profit, with essentially no deductions for costs. This is the honest trade-off behind "no income tax."
- Two separate early filings — your Certificate of Formation, then a required Initial Report within 120 days (free if you formed online).
"No income tax" doesn't mean "no ongoing state tax" in Washington. Most LLCs doing business here owe the Business & Occupation (B&O) tax — a tax on your total gross revenue, not your profit, with no deductions for cost of goods, labor, rent, or materials. You owe it even in a year your LLC loses money. As of 2026, LLCs with under $250,000 in annual gross receipts are exempt — a genuinely helpful recent change for smaller businesses — but once you cross that threshold, this becomes a real, recurring cost most other states don't have. See Step 8 for the full breakdown.
How to Start a Washington LLC in 8 Steps
Your name must be distinguishable from every Washington entity and contain "LLC" or "Limited Liability Company." Search free through the Secretary of State.
Every Washington LLC must continuously maintain a registered agent — a WA resident or authorized entity with a physical in-state street address.
File the Certificate of Formation
$180 (+$20 online processing fee), filed with the Secretary of State — online approval typically about 5 business days.
Not required by Washington, but it overrides state default rules and satisfies your bank.
Get Your Free EIN from the IRS
Your federal tax ID for banking, hiring, and Washington Department of Revenue registration. Always free at IRS.gov.
File Your Initial Report, Then Annual Reports
Initial Report due within 120 days (free if formed online); Annual Report ($70) every year after, due your anniversary month.
Get Business Licenses & Permits
A Washington Business License is required statewide for most businesses — genuinely different from many states with no general license.
Understand Washington LLC Taxes
No personal income tax, but the B&O gross receipts tax and a 6.5%+ sales tax.
What a Washington LLC Really Costs (2026)
| Cost Item | Amount | When |
|---|---|---|
| Certificate of Formation (required) | $180 (+$20 online) = $200 online | One-time, at formation |
| Initial Report (required) | Free online · within 120 days | Once, shortly after formation |
| Annual Report (required) | $70 | Every year, anniversary month |
| Washington Business License | ~$90 | One-time (with renewal, varies) |
| Registered agent service (optional) | $100–$150/yr | Annual, if hired |
| Expedited processing (optional) | +$100 | Faster turnaround |
| EIN from the IRS | $0 — always free | At IRS.gov |
Bottom line: $200 to form online and $70/yr to maintain — higher upfront than many states, but with no personal income tax to offset it. Whether that trade-off favors you depends heavily on your B&O tax exposure, covered in depth below. Model your exact setup below.
Washington LLC Cost Calculator
Washington LLC Cost Calculator
First-year + 5-year totals · verified July 2026
Includes the $90 Washington Business License. Excludes B&O tax and sales tax, which depend heavily on your specific business — see Step 8.
The B&O Tax Trade-Off, Explained Honestly
This is the single most important thing to understand about Washington's tax structure: the state genuinely has no personal income tax, but it also taxes business activity differently than almost every other state in this series. The Business & Occupation (B&O) tax is assessed on your gross receipts — your total revenue — not your net profit, and offers essentially no deductions for the cost of goods, labor, rent, or materials. Rates range from about 0.471% (retailing) to 1.5% (services), depending on your business classification. As of 2026, LLCs under $250,000 in gross receipts are exempt. Some cities — including Seattle, Tacoma, and Bellevue — layer their own separate local B&O tax on top of the state rate. Full details in Step 8.
Washington LLC Taxes at a Glance
Washington levies no personal income tax — LLC members pay $0 in state income tax on distributed profit. Instead, most LLCs owe the B&O tax discussed above, plus federal self-employment tax of 15.3%. Sellers collect a 6.5% state sales tax plus local rates, for a combined average around 9.37% — among the higher combined sales tax rates nationally. Details in Step 8.
Ahmad Adil's Take: Washington gets marketed heavily on "no income tax," and that part is genuinely true — but I want every founder considering Washington to actually understand the B&O tax before they file, not after their first tax bill surprises them. If your LLC stays under $250,000 in gross receipts, you're in a genuinely favorable position: no income tax, no B&O tax, just the standard federal obligations. Once you cross that threshold, budget for B&O as a real, recurring cost on your top-line revenue — profitable or not. This is one of those states where the honest answer to "is it a good state to form in" is "it depends entirely on your revenue level," and I'd rather tell you that plainly than sell you a headline.
- ✓Forms your Washington LLC for $39 + the $180 state fee
- ✓Files online with the Secretary of State
- ✓Free Washington registered agent the first year
- ✓No upsells · No data selling · Privacy by Default
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Washington LLC — FAQ
Ahmad Adil is the founder and CEO of LLC School. The figures here — the $180 Certificate of Formation, the $70 annual report due your anniversary month, and Washington’s B&O gross receipts tax — reflect current Washington Secretary of State and Department of Revenue guidance. This is educational content, not legal or tax advice.
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