Image credit: Unsplash
- As in other states, when you’re ready to register your startup, Washington requires you to choose a unique business name, meaning no other Washington-registered businesses have a name similar to your chosen one.
- Before you register your startup in Washington, in addition to creating a business plan and choosing your business name, you must also determine your startup's legal ownership structure.
- After you complete the above steps, it's time to submit your formation forms to Washington’s Secretary of State’s office.
- Depending upon your chosen entity for your startup, you will have filing fees due when registering your startup. For example, if you register as an LLC, corporation, or a limited partnership, you’ll pay a fee of $180.
- If you want to do business in Washington, but your startup was registered in another state, your fee is also $180 unless you maintain a nonprofit entity, in which case the filing fee is $30.
- When you register your startup in Washington, you’ll be required to obtain a Unified Business Identifier (UBI) number.
- Depending upon your entity, you may be liable for Washington’s business and operations (B&O) taxes, a gross receipts tax.
In a state known for Mt. St. Helens, Mt. Rainier, and the Space Needle, Washington is also a popular state for startups — not just in the United States but globally. According to a 2020 study, Seattle broke into the top ten list for global cities boasting a vibrant startup ecosystem.
Washington is home to large and startup companies alike, with 630,819 small businesses, making up 99.5 percent of all the state’s companies and numerous Fortune 100 companies, including Amazon, Microsoft, Costco, and Starbucks.
If you consider registering your startup in Washington, this article will walk you through the in's and out's of what you need to know.
How to Register a Business Name in Washington State
When you’re ready to register your startup, Washington, like other states, requires you to choose a unique business name, meaning no other Washington registered business has a name similar to your chosen one. To confirm if your startup’s name is distinguishable from any other registered Washington businesses, you can use the corporation registration data search database.
For some entities, such as an LLC or corporation, once you register your startup, your business name is also registered with the state. For other entities, such as a sole proprietorship or a partnership, if your startup name differs from the founders' name, you’ll need to register that name with the state.
Additionally, if your startup is a corporation, limited liability, or limited partnership, and you’d like to use a different name than your startup's legal name, you may do so by registering your trade name with the state. This is often called your “doing business as” (DBA) name. You may choose to use a DBA name, for example, if you offer different product lines that you would like to differentiate in marketing and sales.
How to Register a Business in Washington
When you register your startup in Washington, you'll need to satisfy several compliance requirements. However, before registering your startup, it’s a good idea to research the market and potential competitors, plan for operations and personnel, map out your financing, and create a business plan. The State of Washington provides various resources to help you when launching your startup.
In drafting your business plan, you’ll want to consider marketing, advertising, sales, location, and ownership, to name a few categories. To help guide you, you can check in with the U.S. Small Business Administration or the state of Washington. Both agencies can provide founders with additional guidance for creating a business plan.
Once you’ve identified some of the basics about your business’s operation, it is then time to register your startup. Below, we'll address explore the ins and outs of registering your business in Washington.
Determine Your Business’s Entity Structure
Before you register your startup in Washington, in addition to creating a business plan and choosing your business name, you must also determine your organization's legal ownership structure. For example, in Washington, you may choose to register as a:
- Limited Liability Company (LLC)
- General Partnership (GP)
- Limited Partnership (LP)
- Limited Liability Partnership (LLP)
- Sole Proprietorship
To learn more about the state’s permissible entity types, please visit Washington’s Department of Revenue website, which provides a chart comparing each entity type as to operational requirements, management, taxation, and potential liability. Your chosen business entity also determines the next steps in registering your startup.
For example, suppose you choose an LLC structure. In that case, one or more individuals may engage in any lawful, for-profit business in Washington after registering with the Washington Secretary of State’s office. Additionally, you’ll need to enter into a written agreement with any other founders of your startup, specifying certain activities such as the management of your startup and the distribution of profits and losses among the founders.
On the other hand, if you choose a sole proprietorship, which is the most common business structure for startups and small businesses, you will not have to register with the Secretary of State. However, you will still have to file your startup’s name with the state of Washington, in addition to filing any other state or local licenses or permits.
Identify Your Registered Agent
Next, you need to identify and obtain a registered agent designated to receive court and other legal documents on behalf of your startup. In Washington, “[a]ll Corporations, LLC’s, and Limited Partnerships doing business in Washington must have a Registered Agent with a physical Washington State address [called the registered office]. The Registered Agent may be an individual or business.”
Submit Your Formation Forms
After you complete the above steps, it's time to submit your formation forms to Washington’s Secretary of State’s office. When you register in Washington, you must first determine if your startup is domestic or foreign. A domestic entity is a “business that has registered under the laws of the State of Washington.” A foreign entity is a “business that was created outside of Washington State.”
For example, suppose you choose a domestic for-profit corporation structure for your startup, meaning the initial registration of your business is in Washington. In that case, you can use the state's official forms to complete your articles of incorporation with Washington’s Secretary of State to create your startup. You may file online, through the U.S. mail, or in person. The filing fee is $180.
If you need your filing expedited, then the Corporations Division of Washington’s Secretary of State office offers expeditious filing for those forms submitted online, through the U.S. mail, or in person. For online filings, the fee is an additional $20 per entity. For filings through the U.S. mail or in person, the fee is an additional $50 per entity. If you need your filing done in the shortest amount of time, it’s best to visit the Secretary of State’s office in person, which can often be process forms within an hour.
When you register your startup in Washington, you’ll be required to obtain a Unified Business Identifier (UBI) number. A UBI may also be called a tax number, business license number, or business registration number. However, a UBI is not the same as a federal employer identification number. A UBI is unique to the state of Washington and needed to conduct business within its borders.
When you register your startup, and you’re a domestic entity registering in Washington, you’ll select “NO” as your response as to the UBI number and continue with your filing. Your UBI number will be issued after your complete your registration.
If you are a foreign entity registering in Washington, you may already have a UBI number that can be entered. If this is the case, then you’ll enter your previously assigned UBI number on your registration form. However, do not enter a UBI number for sole proprietorships or general partnerships, even if you already have one.
Lastly, unless you registered as a limited liability partnership or a nonprofit corporation, you must also file an initial report with the Secretary of State’s office within one hundred twenty (120) days after the date your registration is effective. This applies to both domestic and foreign entities. The regular filing fee for this is $10, and the expedited fee is $50.
How Much Does It Cost to Register a Small Business in Washington?
Depending upon the chosen entity for your startup, you will have filing fees due when registering it. For example, if you register as an LLC, corporation, or a limited partnership, you’ll pay a fee of $180. If you want to do business in Washington, but your startup was registered in another state, your fee is also $180, unless you maintain a nonprofit entity, in which case the filing fee is $30.
Also, depending upon your entity, you may be liable for Washington’s business and operations (B&O) tax, which is a gross receipts tax. This tax is “measured on the value of products, gross proceeds of sale, or gross income of the business.” To determine if you owe B&O taxes and the amount due, it’s best to engage an accountant familiar with Washington tax laws to advise you.
After submitting your registration forms, you need to learn about any required state or local licenses, such as a business license. Additionally, you must understand what annual registrations and fees are required of your startup, such as annual reports, requiring a $60 fee for for-profit corporations, LLCs, and LPs. An expedited filing is available for an additional $50.
Benefits of Registering a Business in Washington
Here are some benefits of registering your startup in Washington State:
- Washington is pro-business. For example, for startups in high-growth sectors, Washington offers tax incentives to those founders, encouraging them to grow their businesses through innovation.
- Overall, Washington supports favorable tax policies for businesses. In the Tax Foundation’s 2021 State Business Tax Climate Index, Washington ranked number 16, right behind Oregon.
- Washington does not have a corporate or personal income tax.
- More than 17 percent of Washington’s economic activity is connected to the tech industry.
- Washington is home to many startup and entrepreneurial incubators and accelerators, spurring significant capital investment.
Limitations of Registering a Business in Washington
Here are some limitations of registering your startup in Washington State:
- The business formation and registration processes in Washington are more complex than in other states.
- Although Washington has no personal or corporate income tax, startups must pay B&O tax, which can be complicated to determine amounts owed, as well as a public utility tax. As to the B&O tax, founders are not allowed to deduct labor or any costs of doing business.
- Salaries and benefits are also higher in Washington than in other states. For example, Seattle has instituted a mandatory $15 per hour minimum wage.
Learn more with us
- How to register a business in New York
- How to register a business in Oregon
- How to register a business in Texas
- How to register a business in Lousiana
- Learn more about state registration for your business
Access more guides in our Knowledge Base for Startups
We can help!
At AbstractOps, we help early-stage founders streamline and automate regulatory and legal ops, HR, and finance so you can focus on what matters most — your business.
If you're looking for help registering your Washington startup, we can get your documentation ready, overall shepherding this process to ensure it's done right, get in touch with us.
Like our content?
Subscribe to our blog to stay updated on new posts. Our blog covers advice, inspiration, and practical guides for early-stage founders to navigate through their startup journeys.
Note: Our content is for general information purposes only. AbstractOps does not provide legal, accounting, or certified expert advice. Consult a lawyer, CPA, or other professional for such services.
Looking for a different state?
Visit our State Registration & Compliance Library to explore how to register a business in a different state.