How do I form an LLC in Virginia and what are the annual costs?
The formation itself is straightforward. You file Articles of Organization with the Virginia State Corporation Commission (SCC) and pay a $100 filing fee. You can file online through the SCC’s Clerk’s Information System, which is the fastest option, or submit by mail. The articles require basic information like your LLC name, registered agent and office address in Virginia, organizer name, and whether the LLC will be member-managed or manager-managed. Virginia requires that your LLC name include “Limited Company,” “Limited Liability Company,” or an abbreviation like “LLC.”
Before or right after filing, apply for an Employer Identification Number through the IRS website. This is free and takes about five minutes. You’ll need the EIN to open a business bank account, and you should open one immediately. Mixing personal and business transactions from the start creates a mess that takes real effort to untangle later.
Annual costs are minimal compared to other states. Virginia charges a $50 annual registration fee due by the last day of the month in which your LLC was originally formed. So if you filed in March, your $50 is due every year by March 31. Unlike Virginia corporations, LLCs do not have to file an annual report. Miss the registration fee and the SCC can administratively dissolve your LLC, which creates complications you don’t want.
How your LLC gets taxed at the federal level depends on how many members it has. A single-member LLC is treated as a disregarded entity by default, meaning your business income and expenses flow through to your personal return on Schedule C. A multi-member LLC is treated as a partnership by default and files Form 1065 with K-1s issued to each member. Either type can elect S-Corp taxation if it makes sense for your situation, but that decision should involve someone who understands the tax implications for your specific income level and circumstances.
Beyond the SCC filing and EIN, you may need a Virginia business license depending on your locality. Fairfax County and most Northern Virginia jurisdictions require a Business, Professional, and Occupational License (BPOL). Requirements and thresholds vary by locality, so check with your county or city before you start operating.
One thing many new LLC owners overlook is full-service bookkeeping from day one. Starting clean is always easier and cheaper than going back to reconstruct months of transactions. When your books are accurate from the beginning, your first tax return is straightforward and you have real numbers to make decisions with instead of guessing.
If you want help with the actual bookkeepers in Fairfax filing and getting your financial systems set up correctly from the start, ATS handles business formation and can make sure your accounting software, chart of accounts, and processes are ready to go before you record your first transaction. Getting the foundation right saves you from paying someone to fix it later.
Northern Virginia's Bookkeeping & Advisory Firm
First Step:
Tell Us About Your Business
Every engagement starts with a conversation. Tell us what's going on with your books and we'll give you our honest assessment.
More Questions
What records do I need to keep for a DOT audit or IRS audit as a trucking company?
DOT audits focus on safety compliance records like driver qualification files, HOS logs, and vehicle maintenance. IRS audits focus on financial records including bank statements, depreciation schedules, and per diem documentation. Trucking companies need to maintain both sets at all times.
Read answerWhich version of Form 990 does my nonprofit need to file?
It depends on your gross receipts, total assets, and whether you're a private foundation. Most small nonprofits file the 990-N or 990-EZ, while larger organizations file the full Form 990.
Read answerHow do I handle bookkeeping for a house flip vs. a long-term rental?
Flips and rentals are treated completely differently in your books and on your tax return. A flip is inventory held for sale, with all costs capitalized into cost of goods sold. A rental is investment property that gets depreciated over time on Schedule E.
Read answerHow should a medical practice handle bookkeeping for multiple locations or entities?
It depends on your entity structure. If each location is a separate LLC or PC, keep separate books for each and consolidate for owner reporting. If everything runs under one entity, use class or location tracking in QuickBooks or Xero to segregate financials by site.
Read answerHow does Fairfax County business personal property tax work?
Fairfax County taxes tangible business assets like equipment, furniture, and computers annually. Businesses file a return listing assets and their depreciated values, and accurate fixed asset records in your books make the process straightforward.
Read answerHow do I bookkeep for a concierge or direct primary care practice?
Concierge and DPC practices run on membership revenue instead of insurance billing, which changes how you recognize income and manage receivables. The key is treating membership fees as deferred revenue and recognizing them monthly as services are delivered.
Read answer
