How to start a Virginia LLC
By Bazal Razzaq
Updated: September 22, 2023, 12:30pm
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Virginia, a southeastern United States state, offers great opportunities to people who want to start their own business, especially a Limited Liability Company, aka LLC. The tenth state in the Union of States has multiple opportunities for everyone who wants to become their own boss and contribute to the state’s revenue stream. If you have a plan to be a part of The Old Dominion by establishing your own business and want an online article where all information is available for you easily and effectively, then you have reached the right place. We would cover every aspect that you would want to know about to establish your LLC in the State of Virginia.
The prospect of growing your business in Virginia is huge, as the place home to the ‘Virginia Museum of Fine Arts’ has very simple and effective processes in place to make it an exemplary experience for you as you open your business over there. Now that you are prepared and want to know about the entire process let’s begin our journey and help you know about anything and everything regarding opening an LLC in the State of Virginia. So let’s dive into the information now and find out:
#1 Name Your Virginia LLC
William Shakespeare wrote in his play, “Romeo and Juliet,” ‘What’s in a name?’ but if you want to start an LLC, then everything stems from the name. You would have to pick a name that would be in line with your business division and the work of your stream. The name needs to have the term Limited Liability Company (LLC) in it and shouldn’t be a confusing name with any other entity of the same type in the State of Virginia. The big question arises of how we can ensure the same happens at all costs.
Your business name shouldn’t have a Federal, State, or Treasury name in it. It surely shouldn’t have restricted words like Bank, Attorney, or University. If these names are included, then you would need to add additional documentation to substantiate the reason for choosing the name.
There are some State Corporation Commission guidelines for naming an LLC in Virginia, and you need to run your business name through it to be sure that you have a business name that is as per the guidelines. You can always run your business through Business Entity Search on the Virginia State Corporation Commission website to ensure that your business name doesn’t coincide with anyone else’s business.
#2 Virginia LLC Registered Agent
Now that you have decided on the name and run it through the Business Entity Search, the next step is to find a registered agent who would be the Point of Contact for your business in the State of Virginia. This person must be a resident of Virginia, and if this is a business, then it must be registered to carry out Virginia LLC Business operations. You would have to ensure that this person takes care of all the business proceedings on your behalf.
It includes handling any state or federal lawsuits, official communication, tax forms, and other business-related requests of the same nature. You would need to ensure that this person or business will be able to and has previously abided by the laws and regulations in the State of Virginia. In case you think this may be a bother for you, then you can select anyone from your team (in case of a multi-member LLC) to be the registered agent for your business. You will be the direct registered agent in case your business is a single-member LLC.
#3 Virginia LLC Articles Of Organization
With the aforementioned covered and completed, the next step involves you filing Form LLC1011: Articles of Organization with the State Corporation Commission. This application can be done online or over postal mail. This is the perfect time to determine if you want to keep your business a single-member LLC or a multi-member LLC.
You can fill out the form online and offline by paying a non-refundable amount of $100 to the State Corporation Controller. Alternatively, if you are doing it offline, then you need to share it to a different address by mail. You would have to make the decision of whether you want to register it as a domestic LLC or if you want to register it as a foreign LLC (in case you want to expand your business outside of Virginia). Appended is the address where you need to share the details over mail:
State Corporation Commission
P.O. Box 1197
Richmond, VA 23218-1197
#4 Virginia LLC Operating Agreement
The State of Virginia doesn’t require an operating agreement, but you can surely create one for yourself. It will help streamline details for you and keep everyone in check (in case yours is a multi-member LLC). It avoids disputes in the long run and also keeps everything in black and white.
The fact that this operating agreement serves as a legal document confirms that you can use it in a court of law in case such a situation arises for you wherein you are required to present yourself in the event of a dispute.
#5 Generate Your Virginia LLC EIN
Your LLC needs to be registered with the State of Virginia, and to do that; you would need an Employer Identification Number (EIN). You can obtain this for free from the Internal Revenue Service (IRS). It serves as a Social Security Number (SSN) for your company, and you can get it without using your Social Security Number.
The EIN can be generated online and offline. It is required to open a bank account for the company. It is required for state and federal tax purposes and if you want to hire employees for the company. You need to make sure that you have your EIN based on the type of LLC you wish to register. In case you want to open your business’ branches outside of Virginia, then you need to register as a foreign LLC. In the event of an offline request, you need to send out the request at the appended address:
Internal Revenue Service
Attn: EIN Operation
Cincinnati, OH 45999
Fax: (855) 641-6935
#6 Virginia LLC Annual Registration Fee
When in Virginia, you don’t need to file an annual report. Contrary to other states, Virginia would require an annual registration fee of $50 to the State Corporation Commission. Paid online by or before the last day of the month when your LLC was registered to transact in Virginia, you can always pay it electronically.
If you miss the deadline, you will be charged a $25 late fee. The State of Virginia will also dissolve your LLC in three months if you fail to pay your annual registration fee. It is, therefore, important that you look into the details and make sure that you have everything in check at all times in the State of Virginia.
#7 Comply With The Laws In Virginia LLC
When you plan to open a Virginia LLC, you need to make sure that you comply with the laws of the State of Virginia. You would need to pay different taxes for your LLC depending on the type of business you have registered with the state. Appended are some of the taxes that you may have to pay:
Virginia LLC Sales Tax
In case your LLC is involved in making a sale using a physical product, then you need to register for a seller’s permit from the Virginia State Tax Department. The basic sales tax in the state of Virginia is 5.3%, while an additional 1% tax is implied statewide on food, especially groceries and personal hygiene items. The Department of Taxation for the state of Virginia has outlined the additional regional or local tax that may be implied on different items.
Virginia LLC Employers Tax
In case your business has employees based out of the State of Virginia, then you would need to register for Unemployment Insurance Tax and Employee Withholding Tax on the Virginia Tax website to ensure that you comply with the norms of the state and pay the employees that are required for you to pay them to become a law-abiding business.
The State of Virginia has four tax brackets for individual income tax sections. These tax brackets will vary based on the LLC’s income and would be between 2% to 5.75%. The Viriginia LLC must file its State Income Tax returns by the 1st of May, but fiscal year returns are to be done by the 15th day of the fourth month of the fiscal year. You would need to visit the Virginia Department of Taxation website to calculate your tax and determine your tax bracket.
Filing your federal tax return can be done using Form 1065 for a multi-member LLC and Form 1040 Schedule C for a single-member LLC. These details are important in case you are willing to start an LLC in Virginia and don’t want to fall into issues following your business ethics and guidelines.
Employees are what run a business, and to make sure that your employees are authorized to work in the US, you can always report them as ‘new hires’ to the state. You would be required to provide worker’s compensation insurance and withhold employee taxes. The workspace compliance posters would work well for you and would help others understand that you have a business to run.
Frequently Asked Questions
It takes a week by mail and instantly when the payment is made online. This ensures that you have everything in order at one go for yourself when you set up an LLC in Virginia.
The cost for setting up a Virginia LLC is $100 and needs to be paid when you set up your Virginia LLC.
The minimum wage for Virginia is $12.00 per hour and needs to be paid on time. Failing to do so will have considerable consequences.
Employees need to be paid bi-weekly in the State of Virginia. If an employee has a weekly wage that institutes 150% of the average weekly wage of the common user base, then the person can be paid on a monthly basis. This has to be consensual. Also, Executives, Administrators, and Professionals need to be paid monthly.