Forming an LLC in Washington state costs about $305 in mandatory state fees in year one and roughly $75 each year after that. Once you add a registered agent, insurance, an operating agreement, and tax preparation, most small LLCs spend between $1,500 and $5,000 in their first year before any business taxes. The state charges nothing close to that on its own; the bulk of what you’ll actually pay is in the professional services and taxes surrounding the filing.
State Fees to Form the LLC
A domestic Washington LLC starts with a Certificate of Formation filed with the Secretary of State. The base fee is $180, and filing online adds a processing surcharge on top of that.1Washington Secretary of State. Start a Domestic (WA) Limited Liability Company (LLC) Online Filing by mail is a flat $180 with no surcharge, but turnaround stretches to weeks instead of a few business days.
Every new LLC also owes an Initial Report within 120 days of formation. Submit it together with the Certificate of Formation online and it costs nothing extra. Filing it later on its own is $10.2Washington Secretary of State. Initial Report Instructions
You then register with the Department of Revenue through a Business License Application. The processing fee for a new business at its first location is $50.3Washington State Department of Revenue. Business License Application Form BLS 700 028 That registration assigns your Unified Business Identifier (UBI) number, which you’ll use for every state tax filing after that.4Washington Department of Revenue. Apply for a Business License
If you formed your LLC in another state and just want to operate in Washington, you file a Foreign Registration Statement instead. That fee is also $180, with an optional $100 expedited-service charge.5Washington Secretary of State. Foreign Registration Statement Instructions
Annual State Fees to Keep It Active
Every year you owe two small state fees. The annual report filed with the Secretary of State costs $70.6Washington Secretary of State. Fee Schedule/Expedited Service Renewing your business license through the Department of Revenue adds a $5 processing fee per location.7Washington Department of Revenue. Variable Business License Processing Fees For a single-location LLC, that’s $75 a year in ongoing state compliance costs.
The annual report is due by the last day of your LLC’s formation anniversary month.8Washington Secretary of State. Annual Reports Form in March and you’ll owe every year by March 31.
What Missing a Deadline Costs
Miss the annual report and you owe a $25 delinquency fee on top of the $70 filing fee, bringing the total to $95.6Washington Secretary of State. Fee Schedule/Expedited Service Stay delinquent long enough and the Secretary of State can administratively dissolve the LLC.
Reinstatement is much more expensive than staying current. You pay a $70 filing fee for each missed annual report year, plus a flat $140 penalty fee.9Washington Secretary of State. Reinstate a LLC, PLLC, Profit or Professional Service Corporation Online An LLC dissolved for two missed years faces $280 in back reports and penalties before it can operate again. You also lose the liability protection the LLC provides during the dissolution period, which can turn a routine dispute into a personal claim.
Registered Agent
Washington requires every LLC to continuously maintain a registered agent with a physical street address in the state.10Washington State Legislature. RCW 25.15.021 Registered Agent A P.O. box does not qualify.
Serving as your own registered agent is free, but your address becomes part of the public record and you need to be available there during business hours. A commercial registered agent service typically costs $100 to $300 per year. Basic plans forward documents; higher-priced plans add compliance tracking and annual report reminders.
Common Optional Costs
Operating Agreement
Washington does not require you to file one, but going without an operating agreement tends to cause problems in multi-member LLCs. The document sets ownership percentages, profit-sharing, and exit terms. A lawyer-drafted agreement runs $500 to $2,500 depending on membership and complexity. Single-member LLCs can often use a simpler template, though even a basic version helps reinforce the separation between you and the business.
EIN
An Employer Identification Number from the IRS is free and takes minutes to get online.11Internal Revenue Service. Get an Employer Identification Number Some formation services charge $50 to $100 to do it for you. The IRS itself warns against sites that charge for an EIN.
Trade Name
If your LLC operates under a name different from what’s registered with the Secretary of State, Washington requires you to register that trade name for $5 per name, plus the applicable business license processing fee.12Washington Department of Revenue. Register Trade Names An LLC named “Emerald City Dining, LLC” that operates as “Pike Street Grill” would register the second name.
Insurance
General liability insurance isn’t legally required for every LLC, but going without leaves your business assets exposed to a single slip-and-fall or property damage claim. Most small businesses pay $500 to $2,000 per year for a general liability or business owner’s policy. A solo consultant working from home lands at the low end; retail and restaurants with foot traffic pay toward the top.
Tax Preparation
Between Washington’s B&O tax and federal obligations, most LLC owners find professional tax help worthwhile. Annual tax preparation for a single-member LLC with revenue under $750,000 typically runs $550 to $1,350. Multi-member LLCs pay $900 to $2,400 because partnership returns are more complex. Monthly bookkeeping, if you need it, adds $300 to $800 per month.
Local Licenses and Permits
Your state UBI does not authorize you to operate in every city or county. Most local jurisdictions require their own business licenses or endorsements. Seattle, Spokane, and Tacoma each run their own systems with application fees and annual renewals. Food service, contracting, and alcohol sales layer on additional permits. These fees vary widely, and the only reliable way to pin them down is to check directly with your city and county.
Ongoing Tax Costs
Washington has no personal or corporate income tax.13Washington Department of Revenue. Income Tax The state’s main business tax is the Business and Occupation (B&O) tax, calculated on gross receipts rather than profit.14Washington Department of Revenue. Business and Occupation Tax You owe it even in years where expenses exceed income.
Rates depend on what you do. Service businesses pay 1.5% of gross receipts, the highest common rate. Retailing is 0.471%. Manufacturing and wholesaling are 0.484%.15Washington Department of Revenue. Business and Occupation (B&O) Tax A consulting firm with $200,000 in gross revenue owes $3,000 in B&O tax whether it made a profit or lost money. A retail store at the same revenue owes about $942.
A small business B&O credit can reduce or eliminate the tax for lower-revenue LLCs. Businesses reporting at least half their taxable amount under service and other activities can get up to $160 per month in credit, or $1,920 per year. Other businesses get up to $55 per month. The credit phases out as income rises and can’t reduce liability below zero.16Legal Information Institute. Washington Administrative Code 458-20-104 – Small Business Tax Relief Based on Income of Business Many new LLCs with modest revenue owe little or no B&O in their early years, so it’s worth checking before your first filing.
LLCs selling physical products register with the Department of Revenue to collect and remit sales tax. Combined state and local rates typically fall between 7% and 10.5% depending on location. The tax passes through to customers, but tracking rates and filing returns is real work. LLCs with employees also pick up state unemployment insurance, workers’ compensation, and a 0.58% WA Cares Fund payroll tax on employee wages.17WA Cares Fund. How the Fund Works
The Biggest Hidden Cost: Federal Self-Employment Tax
Washington’s lack of an income tax does not spare LLC owners from federal taxes, and this is where the largest ongoing cost usually hides. Single-member LLCs and multi-member LLCs taxed as partnerships are pass-through entities, so profit flows onto owners’ personal federal returns.
On top of regular federal income tax, LLC members owe self-employment tax of 15.3% on net earnings: 12.4% for Social Security and 2.9% for Medicare.18Internal Revenue Service. Self-Employment Tax (Social Security and Medicare Taxes) The Social Security portion applies only to the first $184,500 in combined wages and self-employment income for 2026.19Social Security Administration. Contribution and Benefit Base Medicare has no cap, and earnings above $200,000 ($250,000 for married filing jointly) add a 0.9% Medicare surtax.
An LLC netting $100,000 in profit owes about $14,130 in self-employment tax alone, before any federal income tax. That single line dwarfs the state fees by a wide margin. LLCs with consistent net income above $60,000 to $80,000 often find that electing S-corporation tax status with the IRS lets them split income between a reasonable salary (subject to payroll taxes) and distributions (not subject to self-employment tax), potentially saving several thousand dollars per year. The election adds payroll and filing requirements, so running the numbers with an accountant is worth the fee.
First-Year Budget Summary
Mandatory state fees for a straightforward domestic LLC:
- Certificate of Formation (online): $180 plus online processing fee
- Initial Report filed with formation: $0
- Business License Application: $50
- First Annual Report: $70
- Business License Renewal: $5
Mandatory first-year state costs land around $305. Add a commercial registered agent ($100 to $300), a basic operating agreement ($500 to $2,500), general liability insurance ($500 to $2,000), and tax preparation ($550 to $1,350 for a single-member LLC), and realistic first-year costs for a typical small LLC come to between $1,500 and $5,000 before business taxes. In later years, the recurring state baseline drops to $75, and your real ongoing costs are your registered agent, insurance, tax prep, and whatever B&O and self-employment tax your revenue generates.