How to Start an LLC in Virginia
Figuring out how to start an LLC in Virginia is not as challenging as it seems. It can be a bit of a hassle, though. Any little slip-up can cost you time and money, not to mention your Virginia LLC’s compliance with the state. To help you out, we put together a step-by-step guide to start an LLC in Virginia.
- What to do before you start an LLC in Virginia
- Filling out and submitting Virginia articles of organization
- Next steps after forming your Virginia LLC
If you want to skip the paperwork, we at Virginia Professional Services LLC can help. We don’t just set up your Virginia LLC—we include free use of our business address, free limited mail forwarding, and a secure online account through which you’ll get timely compliance reminders to keep your LLC in good standing with the Virginia State Corporation Commission. As local experts, we can offer premium services because we keep our focus on the ins and outs of Virginia LLCs.
What are the benefits of an LLC in Virginia?
The benefits of an LLC in Virginia are similar to the benefits of an LLC in other states: asset protection, business flexibility, and lower filing fees. So why are business owners choosing to form Virginia LLCs? Well, it’s pretty straightforward: Virginia business has been booming. On the one hand, business owners could simply choose to operate as a sole proprietorship, but then they risk their personal assets being held liable for any debts their business incurs. On the other hand, business owners might opt to incorporate in Virginia. While that’s great for scaling up, that also means more strict adherence to corporate formalities and higher expenses.
For most small business owners, an LLC is the best of both worlds:
- Personal Asset Protection. A limited liability company establishes legal separation between your LLC and your personal assets. This is often called the “corporate veil.” That separation can help keep your personal assets protected from LLC creditors seeking to “pierce the corporate veil.”
- Avoid Double-Taxation. Unless they elect a different tax status, limited liability companies are taxed as disregarded entities or partnerships, both of which are considered “pass-through” entities. What this means is that, rather than having to pay business taxes and your personal income taxes, everything “passes through” the LLC and is taxed on the individual tax returns of the Virginia LLC members (the LLC owners). This is different from standard corporate taxation, where the business itself pays a corporate income tax, and owners pay another round of taxes on the money they receive on their individual returns
- Flexibility. There are not as many formalities to running an LLC as there are for a corporation. For example, the Code of Virginia lays out requirements for holding annual meetings, giving notice for meetings, and meeting procedures for corporations, but not for LLCs. Additionally, LLCs can be managed by members (much like a partnership) or managers (much like the officers of a corporation). Overall, more flexibility in procedures and management allows small business owners to adapt to an ever-changing business environment in a more agile way.
At the end of the day, starting an LLC in Virginia is a fast and simple way to register with the state and gain all the legal benefits without having to be bogged down by bureaucratic hullabaloo. The added benefits of an LLC in Virginia is the fact that you are operating in a state that is consistently at the top of national rankings for business climate.
How to Set Up an LLC in Virginia
To set up an LLC in Virginia, your main requirements are to file your Virginia Articles of Organization with the Virginia State Corporation Commission (SCC) and pay a $100 filing fee. But if you want to know how to set up an LLC in Virginia properly, we cover it all below.
Before You Set Up an LLC in Virginia
Before you set up an LLC in Virginia, it’s essential to ensure you’ve chosen a business name and designated a registered agent.
- Name Your LLC. If you are going to register a business with the state, you will need to choose a unique business name. You can use the Virginia SCC business entity search to check if your business name is available. Aside from that, your business name must end in “limited liability company,” “limited company,” or an abbreviation of these such as “L.L.C.” or “LLC.”
- Designate a Registered Agent. A registered agent is the person designated on the public records as the “go to” person for official communications to the LLC. Your registered agent could be a person or company with a physical address in Virginia where they hold normal business hours to accept service of process and official correspondence. Typical examples of “official correspondence” are letters from the Virginia State Corporation Commission and service of process (lawsuits, employee garnishments, etc.) from the county sheriff and process servers.
The naming is up to you, but if you are looking for a registered agent service to handle your business mail, visit our “Registered Agent” page. We not only form Virginia LLCs but also serve as local registered agents with a robust suite of professional business services.
Form an LLC in Virginia
After you’ve named your LLC and designated a registered agent, it’s time to officially register your business with the state. Here are the steps you will need to take:
- Fill Out Your Articles of Organization. This part is pretty straightforward. Filing Virginia Articles of Organization requires some key information about your business:
- Company name
- Registered agent name
- Registered agent address
- Principal address (This cannot be a PO box. The address does not have to be located in the state.)
- Organizer’s name and signature (The organizer is the person or business filing the document.)
- Submit Your Articles of Organization. Once you’ve filled out your Articles of Organization, you must file them with the Virginia State Corporation Commission and pay the $100 filing fee. You have three options for submission:
- Online: SCC Clerk’s Information System
- By Mail:
Virginia State Corporation Commission
P.O. Box 1197
Richmond, VA 23218
- By Hand:
Virginia State Corporation Commission
1300 E. Main Street, 1st floor
Richmond, VA 23219
- By Hand:
Or you could hire us to form your LLC for you. As straightforward as it is to do all of the above, the information you file with the Virginia SCC is public record. That means junk mail, unsolicited salespeople, and attempts to sell your information. When you hire us, there’s no need to list your personal information on the Articles of Organization, as we will serve as your registered agent and organizer and provide free use of our business address to help secure your privacy.
After Forming an LLC in Virginia
You’ve tackled the most important part: protecting your personal assets and embracing the advantages of officially forming an LLC in Virginia. Before you dive into business though, there are some additional steps you can take to ensure a smooth business operation and help prevent anyone trying to “pierce the corporate veil” through litigation:
- Draft an Operating Agreement. While not required by the state, an operating agreement is a legally binding internal document that delineates how your LLC will operate as per Va. Code §13.1-1023. Without an operating agreement, your business will default to Virginia’s LLC statutes—statutes that might not be in the best interest of your company. All of our clients have access to our pre-drafted Virginia LLC Operating Agreement along with several key Virginia LLC documents that will set your business up for success.
- Obtain an EIN. An EIN (employer identification number) is a unique number issued by the IRS that corresponds to your LLC’s tax filings. You will need an EIN if you choose to hire employees or elect to be taxed as a corporation. Even opening a bank account, which is the next and perhaps most crucial step after forming your Virginia LLC, will likely require an EIN. Otherwise, you might end up having to give out your social security number to banks and vendors—a move that is not only less secure but blurs the lines between you and your company. You can apply for an EIN through the IRS EIN application portal.
- File BOI Report to FinCEN. All LLCs formed on or after January 1, 2024 must file a Beneficial Owner Information (BOI) report to the Financial Crimes Enforcement Network (FinCEN) within 30 days of formation. LLCs formed prior to 2024, have until the end of 2024 to complete the free filing. The BOI report is required as part of the Corporate Transparency Act in an effort to fight financial crimes within the US, and requires the following information for beneficial owner & company applicant reporting: Full legal names of individuals, their date of birth, physical residence, and a photo/copy of an identifying document (such as a passport, or US driver’s license) that includes a photo, lists the issuing jurisdiction, and a visible, unique identifier number. Beneficial owners include anyone who owns at least 25% of the company, or holds any sort of executive role in decision-making, and company applicants are individuals who may not have any ownership in the company but complete company registrations, and/or direct the filings to be filed for the LLC. LLCs formed January 1, 2024 or later must also provide company information for their LLC including the company’s legal name and any trade, fictitious, or DBA names, the domestic jurisdiction (i.e. Virginia, if formed here), current address, and the tax ID. Beneficial Ownership Information reports are held secure and are not public information.
- Open a Business Bank Account. This is perhaps the most crucial step because it truly fortifies the separation between your personal assets and your LLC. While forming a limited liability company already affords you personal asset protection, a litigious enough attorney can pierce the corporate veil if you mingle your personal and bank assets. Here’s what you’ll need to open bank account for your Virginia LLC:
- Your Virginia LLC Articles of Organization
- Your LLC’s Operating Agreement
- Your LLC’s Resolution to Open a Bank Account (for multi-member LLCs)
- Your LLC’s EIN
We know that one of the main benefits of forming an Virginia LLC is that it’s a fast and simple way to limit your personal liability for business debts. The above steps might seem an afterthought, but really, they’re just a savvy way to strengthen your Virginia LLC’s existing protections and lay out ways to resolve any internal disputes down the line.
We take pride in our personalized, high-quality business services. We don’t just set up your Virginia LLC, either. We include the following when you hire us:
- Free use of our business address on your public filings to protect your privacy
- Free limited mail forwarding (and paid mail forwarding options for those who want more)
- A secure online account through which you’ll get compliance reminders to keep your business in good standing with the Virginia SCC
- Pre-filled out LLC documents (like an Virginia Operating Agreement) immediately accessible through your client account
Our local filings experts complete and submit Articles of Organization for our registered agent clients for $200, which includes the state filing fees. After that, our registered agent service is $125 a year. We are not just another business formation service that files your articles and collects mail as your registered agent. We offer a comprehensive, premier LLC formation package that includes everything you’ll need as a modern business owner. For anything else, you can always reach out to our local business filings experts.
Virginia Registered Agent Services
Located in the capital of Virginia, we can capably act as your registered agent today