How to Start an LLC in the District of Columbia
To start an LLC in the District of Columbia, you must file Articles of Organization with the Department of Consumer & Regulatory Affairs (DCRA). You can file the document online, by mail or in person. The Articles of Organization cost $220 to file. Once filed with the state, this document formally creates your District of Columbia LLC. However, to actually ready the LLC to do business, you must complete several additional steps.
Starting a District of Columbia LLC Guide:
District of Columbia LLC Filing Options
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District of Columbia LLC Articles of Organization free download. When you're done filling out the form, submit it to your state.
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DC LLC Articles of Organization Requirements
To form a District of Columbia LLC, you must complete and file the Articles of Organization with the DCRA. See the document below and click on any number to see what information is required in the corresponding section.
You have to include “Limited Liability Company,” “Limited Company” or an abbreviation.
Your principal office should be a street address, not a PO Box. Some people list their home office, but it’s important to remember that your Articles of Organization are a matter of public record, so putting a personal address could jeopardize your privacy and security. When you hire Northwest, you can list our address.
You can list an individual or a business that provides registered agent service, such as Northwest.
This is the address where your registered agent will be available. It has to be a street address in DC (like our address).
Skip this section if you want your LLC to start right away. Want to wait a bit (maybe the current tax year’s almost done with)? You can list a start date up to 90 days in the future.
Most people think your organizer has to be a member or manager of the LLC. Nope. Your organizer is just whoever signs and submits your Articles. Organizers must include their name and address. Why include any more personal information than you have to? Hire Northwest, and we’ll be your organizer.
How much does it cost to start a District of Columbia LLC?
The DCRA filing fee is $220. Hire Northwest to form your DC LLC, and your total, out-the-door cost is $445. This includes registered agent service, biennial report reminders, and loads of forms and tools to help your business get up and running.
Need it expedited? Our total package cost, including expediting fees, is $495 for 3 days or $545 for 1 day.
How long does it take to start a District of Columbia LLC?
The fastest method is either online or in person with expediting. 1-day expediting is an extra $100, and 3-day expediting is an extra $50. If you forgo expediting and file online, the standard processing time is 15 business days. If you have all the time in the world, you could mail your filing, which takes and average of 3-4 weeks.
If you hire Northwest to start your LLC, we file online and can typically have your DC LLC formed within 24 hours when you choose the fastest expediting option.
Does a District of Columbia LLC need a registered agent?
Yes, the District of Columbia requires LLCs to appoint a registered agent. You could be your own registered agent, but the few bucks you save can cost you privacy and tie you to your desk. Any names and addresses you list in your Articles of Organization become a part of the permanent public record. Public records are unfortunately prime targets for data sellers who sell your information over and over again and fill your mailbox with junk.
Also, in a city where you’re defined by your job—where the first thing people ask you is “what do you do?”—you want to be the best at what you do. At Northwest, we work hard to be the best at what we do, and we think you should too. Devote your time and energy to improving your business and living your best life—go run DC’s beautiful trails and actually go visit the galleries—and leave the registered agent service to us.
Create the DC LLC Operating Agreement
Do I need an Operating Agreement?
Your LLC should absolutely have an operating agreement. While a written operating agreement isn’t legally required, it’s one of your LLC’s most critical internal documents.
Why is an Operating Agreement important?
Your operating agreement is a snapshot of how your business really runs—it lists how much each person invested, how profits and losses will be allocated, what happens if the business goes belly up, and more. DC is a city built on paperwork. Documentation of your basic business operations is expected. Don’t wait to create an operating agreement until a dispute happens or the bank or a potential member or business partner asks to see it.
You know that feeling when you’re stuck in DC traffic for hours behind a motorcade (or even more likely, stuck behind groups of adorable yet painfully slow elementary students on field trips to the capital)? And there’s nothing you can do except slowly inch your car forward while the temperature, humidity and your anxiety rise? And you’re kicking yourself because you know you could have prevented this situation with better planning? But you’re stuck.
Do I have to write the Operating Agreement?
You may luck out and never need your operating agreement, but why risk it? Plan ahead, and don’t get stuck. As you’ve probably guessed, we feel very passionate about operating agreements at Northwest. We include an operating agreement—specific to your LLC’s management style—for free with all orders. We also have loads of other free LLC forms that we’ve spent years refining—our free forms have been used by over a million LLCs.
Get a District of Columbia LLC EIN
Do I have to get a tax ID number (EIN)?
Your LLC will need an EIN if you plan to have employees or if you’re required to submit special tax filings, such as an Alcohol/Tobacco/Firearm return. Most banks will request your EIN when you go to open a business bank account. EINs can even help you out with the security of your personal information—you can often use your EIN instead of offering up your personal social security number in situations like establishing credit with a vendor. Getting an EIN from the IRS is free, so you might as well get one just in case. (If you really just don’t want to fill out the paperwork, you can add on EIN service when you hire Northwest.)
Open a Bank Account for Your DC LLC
To open a bank account for your District of Columbia LLC, you will need to bring the following with you to the bank:
- A copy of the DC LLC Articles of Organization
- The LLC operating agreement
- The DC LLC’s EIN
If there are multiple members in the LLC, you may also want to bring an LLC resolution to open a bank account that states that the person going to the bank is authorized by the members to open the account in the name of the LLC.
We recommend calling your bank ahead of time before going in and asking what their requirements are. Most banks don’t open business accounts nearly as frequently as personal accounts, so some bankers may be unfamiliar with their own bank’s requirements. As frustrating as that may be for you, calling ahead will help save you from being super annoyed when you walk into the bank.
Obtain a Business License
Does a District of Columbia LLC need a business license?
Yes, if you’re engaging in business in DC, you’ll need a business license. A basic business license from the DCRA business center is sufficient for most businesses. A basic license lasts 2-4 years and will cost upwards of $100 (and sometimes over $1000 depending on the license category). A business license for a bakery, for example, currently lasts two years and will set you back $517.
File the LLC Biennial Report
What is a District of Columbia LLC Biennial Report?
The DC Biennial Report updates the DCRA on your LLC’s ownership and contact information. Even if your information hasn’t changed, you’re still required to file this form and pay the $300 filing fee every two years. Forget to file? You’ll owe an additional hundred bucks in late fees and lose your good standing. When you hire Northwest, we’ll send you reminder notifications for these reports (or if you don’t want to worry about it at all, you can hire us to file your Biennial Reports for you as well).
How much does an LLC in the District of Columbia cost each year?
Not including taxes and licenses, the cost averages out to $150 a year—every other year, your LLC is required to file a Biennial Report, which has a filing fee of $300.
Pay the LLC Taxes
What are the District of Columbia LLC taxes?
The Washington DC personal net income tax rates are:
The sales tax for most goods and services is 5.75%. However, there’s a reason DC visitors are often hit with sticker shock. A few of the categories of goods and services that visitors utilize the most also have significantly higher sales tax. There’s a whopping 18% sales tax for commercial parking (like trying to park in DC isn’t bad enough), 14.8% for hotels, and 10% for restaurant meals, rental vehicles and liquor sold for consumption.
DC also has a few other taxes that often surprise new business owners, including a personal property tax (you only have to pay it if you have personal property valued at over $225,000, but you still have to file). There’s another unusual tax that some LLCs will have to pay called the Unincorporated Business Franchise Tax. The tax starts at $250 for unincorporated businesses (like LLCs) with gross receipts over $12,000.