Fact Checked by Editorial Staff
Perhaps you are hoping to form an LLC in DC. People assume how to start an LLC is difficult and costly. However, it’s generally not difficult, and the cost would vary across states. We have all the info you need to know about the cost of forming an LLC, particularly the LLC cost in DC.
On this page, you’ll learn about the following:
DC LLC Cost of Filing
Here are the costs involved in forming an LLC in DC.
Cost of Filing Formation Certificates
The DC Certificate of Formation is responsible for the majority of the cost, which could also vary depending on whether you’re forming a domestic LLC or a foreign LLC. Still, you can file both at the DC Secretary of State.
DC Domestic LLC
- Online Filing costs $220.
- Expedited Filing Fee $320
- By mail: Fill out the application form, and send it to Department of Consumer and Regulatory Affairs Corporations Division PO Box 92300 Washington, DC 20090. costs $320
- In-person filing: Fill out the application form, and send it to the Department of Consumer & Regulatory Affairs, 1100 4th St. SW, Washington, DC 20024. costs $320.
- Biennial Report filing costs $300.00. Late filing of the report bears a penalty of $100.00.
DC Foreign LLC
- Online Filing Costs $220
- By mail: Fill out the application form, and send it to the Department of Consumer and Regulatory Affairs Corporations Division PO Box 92300 Washington, DC 20090, costs $220.
- Biennial Report filing costs $300.00. Late filing of the report bears a penalty of $100.00.
Note that filing online is ideal, not only because you need to go to the Secretary of State office, but also it would be faster. You won’t have to wait in a queue in doing so.
DC LLC Formation Service or Registered Agent Fee
You need a registered agent to form an LLC in DC, hence, added costs for service fees. Here are three of the best LLC services on our list that will provide you with registered agents to ease your worries.
LLC Service | Our Rating & Pricing | Top Features | Learn More |
#1 TOP PICK  | $0 + State Fees |
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Business Permits and Licenses
The business licenses depend on your business’s activity and location and are renewed yearly. As such, the cost will vary. Check the DC Department of Revenue for regulatory boards or agencies requiring licensing.
Business taxes
Apart from the filing of the Annual Report, the DC LLCs are also subject to state tax filing obligations. Though the taxes vary from place to place. There are different types of taxes imposed on entities operating their businesses in DC, such as federal income tax, payroll tax, sales tax, etc.
Income Tax
The income tax in the State varies between 4%-8.95% depending on the amount of income earned. If your business sells products into the State, it shall also attract sales tax at the rate of 6%.
Self-Employment Tax
DC Federal Self-Employment Tax is imposed on the business members who take profits out of the LLC. The current tax rate is 15.3%.
Federal Income Tax
DC Federal Income Tax is paid only on the income that you extract from the profits of your business, reducing the allowances and other deductions. The bracket for this is the same as the State Income Tax.
Withholding Tax
If you employ any person in your business, you must withhold the payroll tax from your employees at the rate of 7.65% of their taxable salary.
Other Mandatory Costs
DC LLC Name: It costs $50 to reserve the name of your LLC for 60 days.
Home Occupation Permit: The application for a Certificate of Occupancy for a DC LLC costs $72.60.
Business License: Obtaining Basic Business License costs around $200 for DC LLCs. Assessment of the licenses is done every two years and the licenses can be renewed at a cost of $70 with $25 for each endorsement. The DCRA Government website provides updated costs information to set up an LLC in DC.
Comparison with the Neighbouring States
Every state has different costs of filing for an LLC to their respective State Authorities. If you wish to gain a better understanding of the costs of opening an LLC in a different state in comparison to DC, check out the table below:
| States | DC | Maryland | Pennsylvania | Delaware | West Virginia |
| Online filing fee | $220 | $100 (Mail) $150 (online or in-person) | $125 | $90 | $100 |
| LLC Annual fee | $300 (Biennial) | $300 | $520 times the number of members of the LLC | $300 | $25 |
| Name reservation fee | $50 | $25 | $70 | $75 | $15 |
| Sales Tax | 6% | 6% | 6% | No sales tax | 6% |
The Department of Consumer and Regulatory Affairs offers several programs for the District of Columbia to support businesses. Those who want to start an LLC in DC can explore different sectors and trade as per their preferences. The major sectors contributing to the GDP of DC are retail trade, wholesale trade, construction, and utilities.
Other Costs
- DC Name Reservation: $50 by mail
- Doing Business As (DBA): $55 for online filing or by mail
- Certified Document Copies: $50 per document.
- Certificate of Good Standing: $50
- Business Domain Name and Website: depend on your preference, but domain name could be as low as $2.99/yr at NameCheap, and web hosting is at least $30/mo at Kinsta.
- Online workspace: at least $4.20/mo for GSuite.
- Business Insurance: would vary depending on insurance type–whether general liability insurance or professional liability insurance–and coverage.
- Dissolution of DC LLC: $220
F.A.Qs
It is possible to form an LLC without professional help, but forms still have associated costs, regardless of where your LLC is formed.
It is difficult to say whether forming an LLC is expensive. Nevertheless, the cost could be anywhere from $40 to $500. If you refuse to hire professionals, you’ll still have expenses like form fees to cover.
The need to separate personal money from business funds, thus necessitating the creation of a business bank account for your LLC.
How Much Does It Cost to Maintain an LLC in District of Columbia
To maintain an LLC in District of Columbia you will need to pay a biennial fee of $300 along with sales tax at 6%, income tax (4-8.95%) and federal taxes.
One of the primary costs associated with maintaining an LLC in the District of Columbia is the annual report fee. All LLCs in the District of Columbia are required to file an annual report with the Department of Consumer and Regulatory Affairs (DCRA) each year. This report includes updated information about the LLC, such as its registered agent, mailing address, and member/manager information. Failing to file this report can result in penalties or even the dissolution of the LLC.
In addition to the annual report fee, there are also registration fees that must be paid when forming an LLC in the District of Columbia. These fees can vary depending on the type of business and its specific requirements. It’s important to budget for these costs when starting your LLC to avoid any surprises down the road.
Furthermore, LLCs in the District of Columbia are also subject to certain taxes, such as the franchise tax. This tax is levied on all LLCs operating in the District of Columbia and is based on the gross receipts or net income of the business. Additionally, LLC members may also be required to pay self-employment taxes on their share of the LLC’s profits.
Another aspect to consider when calculating the costs of maintaining an LLC in the District of Columbia is the potential need for professional services. While it is possible to handle many of the administrative tasks yourself, such as filing the annual report and managing the business’s finances, some businesses may benefit from hiring a professional, such as an accountant or attorney, to ensure compliance with all legal requirements.
Overall, the cost of maintaining an LLC in the District of Columbia can vary depending on several factors, including the size and type of business, as well as the level of professional services required. It’s important for business owners to carefully budget for these expenses and plan ahead to ensure that their LLC remains in good standing with the state.
In conclusion, while there are costs associated with maintaining an LLC in the District of Columbia, the liability protection and other benefits that come with this business structure can outweigh the expenses. By being aware of the fees and taxes involved, and planning accordingly, business owners can ensure the long-term success and compliance of their LLC.
In Conclusion
The cost of D.C. is much lower compared to other forms of business. Apart from the state filing fees and annual taxes, you might bear the cost of the registered agent. Compare the price of professional LLC services and choose the most affordable one.