Here are the steps you need to take to form an LLC in the District of Columbia. For more information on how to form an LLC in any state, see Nolo's article How to Form an LLC.
Under District of Columbia law, an LLC name must contain the words “Limited Liability Company” or the abbreviation “L.L.C.”
Your LLC’s name must be readily distinguishable from the names of other business entities already on file with the District of Columbia Corporations Division of the Department of Consumer & Regulatory Affairs (DCRA). Names may be checked for availability by searching the District of Columbia Corporations Division business name database.
An available name may be reserved for 120 days by paying a $50 fee. Reservations are made online on the District of Columbia Corporations Division website or by mail by filing Name Reservation Registration & Transfer, Form GN-3.
Every District of Columbia LLC must have an agent for service of process in the state. This is an individual or business entity that agrees to accept legal papers on the LLC’s behalf if it is sued. The registered agent may be (1) an individual who resides in the District, (2) a business entity with an office in the District, or (3) a commercial registered agent registered in the District. The registered agent’s address must be within the District, and the address given must be the physical street address. A member of the LLC may serve as the registered agent if the LLC’s office address is within the District. You can find a registered agent in the District of Columbia by searching the Internet.
A District of Columbia LLC is created by filing Articles of Organization for Domestic Limited Liability Company, DLC-1, with the District of Columbia Corporations Division.
The certificate must include:
The Articles may be filed online or by postal mail. The filing fee is $220.
An LLC operating agreement is not required in the District of Columbia, but is highly advisable. This is an internal document that establishes how your LLC will be run. It sets out the rights and responsibilities of the members and managers, including how the LLC will be managed. It can also help preserve your limited liability by showing that your LLC is truly a separate business entity. In the absence of an operating agreement, District of Columbia LLC law will govern how your LLC operates. An operating agreement does not need to be filed with the Articles of Organization.
All of the paperwork and procedural steps to start a limited liability company can be done online using Nolo's Online LLC Formation service.
Additional tax and regulatory requirements may apply to your LLC. These may include:
EIN: If your LLC has more than one member, it must obtain its own IRS Employer Identification Number (EIN), even if it has no employees. If you form a one-member LLC, you must obtain an EIN for it only if it will have employees or you elect to have it taxed as a corporation instead of a sole proprietorship (disregarded entity). You may obtain an EIN by completing an online application on the IRS website. There is no filing fee.
Business Licenses: According to the Department of Consumer and Regulatory Affairs, to operate legally in the District of Columbia, a business must be licensed. The necessary license will vary depending on the kind of business. In many cases, you’ll need a Basic Business License (BBL). For more detailed information, including lists of business license categories, check the Basic Business License (BBL) area of the DCRA website. See also Nolo's article How to Get a Small Business License in Washington, D.C.
Register with Office of Tax and Revenue: In some cases, for example if you will be selling goods and collecting sales tax or if you have employees, you’ll need to register with the District of Columbia Office of Tax and Revenue (OTR). You must register online using Form FR-500, New Business Registration. For more information on state LLC tax registration, check Nolo's article, District of Columbia LLC Annual Filing Requirements.
District of Columbia LLCs and foreign LLCs registered in the District must submit a report biannually with the Department of Consumer and Regulatory Affairs, along with a registration fee of $300. The report is filed using Two-Year Report for Domestic & Foreign Filing Entity, Form BRA-25. It must include:
The first biennial report must be filed by April 1 of the year following the calendar year in which the LLC was formed or registered to do business in the District. Subsequent biennial reports must be filed by April 1 of each second calendar year. The report can be filed online, or by mail.
If you are just starting your business or have already been operating as a sole proprietor, you should consider forming an LLC. LLCs limit an owner's personal liability for business debts and lawsuits and offer a lot of flexibility when it comes to ownership, management, and taxation of the business. To learn more about LLCs and decide if it is the right business structure for you, see What is a Limited Liability Company (LLC)?
It is important to make sure that your LLC's name is distinguishable from the names of other existing businesses on file with the District of Columbia Corporations Division of the Department of Consumer & Regulatory Affairs. You can conduct a name search for free on the District of Columbia Corporations Division website to make sure your proposed name is available.
Filing on your own is often the cheapest option, but completing all of the forms and filing them yourself can be complicated. Hiring a lawyer is another option, but will often cost you hundreds, if not thousands, of dollars in the process. Nolo's Online LLC formation service can complete all of the paperwork and filings for you, with packages starting at just $49.00. To learn more about the costs associated with forming and running an LLC, see How Much Does It Cost to Form an LLC?
The District of Columbia does not require LLCs to have operating agreements, but it is highly advisable to have one. An operating agreement will help protect your limited liability status, prevent financial and managerial misunderstandings, and ensure that you decide on the rules governing your business instead of state law by default. For more information, see The LLC Operating Agreement.
All LLCs organized outside of District of Columbia must register with the superintendent of Corporations of the District of Columbia Regulatory Affairs agency to do business in District of Columbia. Foreign LLCs must appoint a registered agent for service of process physically located in District of Columbia. To register, file a Foreign Registration Statement, Form FN-1. The statement may be filed online or by mail. The filing fee is $220.
For most formation purposes, a District of Columbia single-member LLC is considered the same as a multi-member LLC. The steps to form a single-member LLC in D.C. are the same as those listed above.
Single-member LLCs do have additional flexibility when it comes to filing a tax return. To learn more, see Nolo’s article, How Single-Member LLCs Pay Federal Income Tax.
If you provide a licensed professional service in the District of Columbia and want to form an LLC, you will be required to form a professional limited liability company (PLLC). Examples of professional services include architects, attorneys, dentists, certified public accountants, and more. Generally, if you provide a service that requires you to obtain a The District of Columbia state license before practicing, then you are a professional service. Each member of the company must be licensed in order to form a PLLC. To learn more about forming a D.C. PLLC, see our article, How to Form a Professional LLC in the District of Columbia.
If you reach the point where it is time to close your business and cease all operations, then you will want to properly dissolve your LLC to limit your liability for lawsuits and government fees. Learn about the steps you will need to take in Dissolve a Corporation or LLC to End Your Liability.