How to Start an LLC in District of Columbia

How to Start an LLC in District of Columbia

by Michael H. Cohen, Esq., October 2014

LLCs in the District of Columbia are affordable and easy to form. And as with the states, the District of Columbia has some unique LLC requirements.

Interested parties must register with the District of Columbia Corporations Division by filing the necessary forms, paying the necessary fees and meeting all naming and formation requirements.

The specifications required of LLCs in the District of Columbia are as follows:

Registration. Registrants must file Articles of Organization with the Corporations Division. The articles must include pertinent information such as:

  • LLC name and principal office address
  • Duration, if the LLC will not be permanent
  • Purpose of LLC
  • Registered agent’s name and address
  • List of names and addresses of all organizers, members and managers
  • Dated signature of all organizers

All documents submitted must be accompanied by the payment for the filing fee, as well as a signed Registered Agent Written Consent Form (RA-1).

Forms and fees. LLC registrants are required to file Articles of Organization and a Registered Agent Written Consent Form, accompanied by the necessary filing fee of $220, with the Corporations Division. All documents must be filed in duplicate and must both be originals.

Expedited processing services are available for additional fees, as follows: same-day processing for $100 and three-day processing for $50. These fees are subject to change, check with the Corporations Division for the most recent requirements.

Timeline. The usual processing time for LLC documents and filings can take up to 14 working days. Expedited processing services are available for additional fees.

Naming requirements. LLC naming requirements can be confusing. However, the easiest way to make sure that your LLC name will be approved is to ensure that it is distinguishable from other LLCs. Most states and districts have a list of specific words that must be included in the name of your LLC. You may opt to have a preferred name checked for availability before filing your LLC formation documents with the Corporations Division.

Formation requirements. To form an LLC, a registrant must first file Articles of Organization with the Corporations Division.

An LLC with more than one member is also strongly advised to have a limited liability operating agreement among its members.

Should your LLC offer professional services, you may have to obtain certain licenses and permits from the district’s professional licensing boards.

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Starting an LLC in the District of Columbia

Before you begin the registration process for an LLC in the District of Columbia, it’s important to know what an LLC is and whether or not it is a viable business structure for your company, so be certain to read up on the definition and benefits of an LLC.

These steps will guide you through the LLC registration process with the District of Columbia Corporations Division:

1. Decide on a name for your business. You can choose any name for your LLC as long as it ends with “Limited Liability Company” or any variation of its abbreviation—e.g., LLC or L.L.C.

A name may be reserved for up to 60 days. You must file a name reservation application, along with the $50 filing fee, with the Corporations Division. Be sure to include the name to be reserved, the entity type and the applicant’s name and dated signature.

2. Assign an agent for service of process. Registered agents are individuals or corporations authorized to do business in the state and which have permanent addresses in the District of Columbia. Registered agents accept legal documents on behalf of the LLC and make sure its members are notified.

3. Get an Employer Identification Number (EIN) from the IRS. If there are two or more members in your LLC, your company will need to obtain an EIN from the IRS, for tax purposes.

4. Create an operating agreement. Although LLCs in the District of Columbia are not required to have a limited liability company operating agreement, it is wise to have one in place with other members should your LLC have more than one member. The District of Columbia recognizes limited liability company operating agreements as governing documents.

5. Familiarize yourself with the LLC’s continuing legal obligations, specifically biennial reports. Reports are filed with the Corporations Division on or before April 1 every other year. Reports may be done online by accessing CorpOnline and must include the $300 filing fee. There is a $100 penalty fee for late reports. The first report is due on April 1 of the year following that in which the LLC was formed.

LLCs in the District of Columbia that gross more than $12,000 in profit per year are required to file Unincorporated Business Franchise Taxes (Form D-30) with the Office of Tax and Revenue. The form must be filed and paid by April 15 every year. The minimum amount an LLC will be mandated to pay is $250 per year.

Make sure that your LLC, should it offer professional services, meets the district’s legal requirements.

Additional continuing legal obligations may vary with each state and district. These could be, but are not limited to, district taxes, annual or biennial reports and so on.

Filing an LLC and Fees

Following are the forms and fees that are required when starting an LLC in the District of Columbia:

1. Forms. First, you need to complete and submit Articles of Organization to the Corporations Division. All documents submitted must be accompanied with the payment for the necessary filing fee.

2. Fees. The filing fee for Articles of Organization is $220. This must be paid upon submission of the documents to the Corporations Division. These fees are subject to change, check with the Corporations Division for the most recent requirements.

3. Limited liability company operating agreement. Although the LLC operating agreement will not be submitted to the Corporations Division, it is a good idea to have one in place for LLCs with more than one member. This agreement should be kept on file by the registered agent.

4. Taxes. LLCs in the District of Columbia are treated as corporations, limited liability partnerships or single-member LLCs and are subject to federal income tax classifications. Depending on the type of taxation you opt to have for your LLC, you will have different federal tax responsibilities.

You should always make sure to acquaint yourself with the district laws regarding taxation. Your LLC may be subject to other taxes depending on the kind of services it offers.

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