Whether you are opening a brand-new business, making changes to your existing business structure, or hiring employees for the first time

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Getting Started

The first thing you need to know if you are opening a new company is what kind of business structure will work best for your purposes. At Baldwin Legal Group, we can assist you in this decision. On this page, you will find the different types of businesses and benefits to each type. You will also find the steps needed to open a business in the state of Washington. We know there is a lot of information to look through. If you start to feel overwhelmed, please contact our staff at This email address is being protected from spambots. You need JavaScript enabled to view it. or 360.464.3591 and we would be happy to answer as many of your questions as we can.

We know that starting a new business can be a daunting task, and we are dedicated to helping you through it step-by-step. We can accommodate whatever level of involvement you are comfortable with, whether you want to do it yourself with our assistance or leave it all up to us so you don’t have to worry about it at all.

We charge a minimum service fee of $300 to prepare documents that you will have to file with all of the different state and federal agencies yourself or a flat rate of $1000 for the full-service package. With the full-service package, we will ensure all of the documents needed to form your business are filed accurately with the state and federal government agencies and prepare a professional binder for you with all your corporate documents in one place within 7-10 business days.

If you feel confident enough to go through the process yourself, click here for the next steps.

If you would rather let Baldwin Legal Group handle the drudgery of paperwork and filing for you while you work on all the fun stuff, please click here to fill out our short questionnaire. It’s that easy! In less than 5 minutes, you will have started the entire process to get your business licensed in the state of Washington.

Registered Agent Services

Certain business structures require a registered agent. A registered agent is a responsible third-party who is registered in the same state in which a business entity was established, handles all the annual filing of your corporate documents, and accepts tax and legal documents on behalf of your business, making sure you don't miss important information regarding tax payments, lawsuits, or judgments involving your business.

While it is usually legally possible to serve as your own registered agent, it is advisable to designate a third-party to perform this important role. Washington State does not allow you to open a business with just a P.O Box so if you do not have a physical location in the state in which your business is registered, you should select a registered agent to accept documents on your behalf.

By hiring Baldwin Legal Group to be your registered agent, you can have the peace of mind that someone will always be available to claim any important information on your behalf, and you don’t have to worry that a process server might show up at your business—or worse, might miss you because your office isn’t open. For the low monthly rate of $50 per month, you can trust us to take care of keeping your corporate filings current—and other headaches—so you can focus on the actual purpose of your business.

What type of business should you choose?

There are many different types of businesses. Here is a comprehensive list of business types and the benefits of each:

Single Owner or Partner-Owned Businesses

Sole Proprietorship

A Sole Proprietorship is one individual or married couple in business alone. Sole proprietorships are the most common form of business structure. This type of business is simple to form and operate, and may enjoy greater flexibility of management, fewer legal controls, and fewer taxes. However, the business owner is personally liable for all debts incurred by the business.

 

General Partnership

A General Partnership is composed of 2 or more persons (usually not a married couple) who agree to contribute money, labor, or skill to a business. Each partner shares the profits, losses, and management of the business, and each partner is personally and equally liable for debts of the partnership. Formal terms of the partnership are usually contained in a written partnership agreement.

 

Limited Partnership

A Limited Partnership is composed of one or more general partners and one or more limited partners. The general partners manage the business and share fully in its profits and losses. Limited partners share in the profits of the business, but their losses are limited to the extent of their investment. Limited partners are usually not involved in the day-to-day operations of the business. Filing with the Washington Secretary of State is required.

 

Benefits of Single Owner or Partner-Owned Businesses

  • Ease of formation: Starting a sole proprietorship is much less complicated than starting a formal corporation, and also much cheaper. Some states allow sole proprietorships to be formed without the double taxation standards applicable to most corporations. The proprietorship can be named after the owner, or a fictitious name can be used to enhance the business’ marketing.

  • Tax benefits: The owner of a sole proprietorship is not required to file a separate business tax report. Instead, they will list business information and figures within their individual tax return. This can save additional costs on accounting and tax filing. The business will be taxed at the rates applied to personal income, not corporate tax rates.

  • Employment: Sole proprietorships can hire employees. This can lead to many of the benefits associated with job creation, such as tax breaks. Also, spouses of the business owner can be employed without having to be formally declared as an employee. Married couples can also start a sole proprietorship, though liability can only assumed by one individual.

  • Decision making: Control over all business decisions remains in the hands of the owner. The owner can also fully transfer the sole proprietorship at any time as they deem necessary.

Limited Liability Company (LLC)

A Limited Liability Company (LLC) is formed by 1 or more individuals or entities through a special written agreement. The agreement details the organization of the LLC, including provisions for management, assignability of interests, and distribution of profits and losses. LLCs are permitted to engage in any lawful, for-profit business or activity other than banking or insurance. Filing with the Washington Secretary of State is required.

 

Limited Liability Partnership (LLP)

A Limited Liability Partnership (LLP) is similar to a General Partnership except that normally a partner doesn’t have personal liability for the negligence of another partner. This business structure is used most by professionals, such as accountants and lawyers. Filing with the Washington Secretary of State is required.

 

Limited Liability Limited Partnership (LLLP)

A Limited Liability Limited Partnership is a Limited Partnership that chooses to become an LLLP by including a statement to that effect in its certificate of limited partnership. This type of business structure may shield general partners from liability for obligations of the LLLP. Filing with theWashington Secretary of State is required.

Benefits of an Limited Liability Company/Partnership

The benefits of creating an LLC typically outweigh any perceived disadvantages and are typically unavailable to sole proprietorships and general partnerships.

 

  • Protected assets. LLCs provide limited liability protection to their owners (members), who are typically not personally responsible for the business debts and liabilities of the LLC. Creditors cannot pursue the personal assets (house, savings accounts, etc.) of the owners to pay business debts. Conversely, in a sole proprietorship or general partnership, owners and the business are legally considered the same—leaving personal assets vulnerable.

  • Pass-through taxation. LLCs typically do not pay taxes at the business level. Any business income or loss is "passed-through" to owners and reported on their personal income tax returns. Any tax due is paid at the individual level.

  • Heightened credibility. Forming an LLC may help a new business establish credibility with potential customers, employees, vendors and partners because they see you have made a formal commitment to your business.

  • Limited compliance requirements. LLCs face fewer state-imposed annual requirements and ongoing formalities than S corporations and C corporations.

  • Flexible management structure. LLCs are free to establish any organizational structure agreed upon by the company owners. LLCs can be managed by the owners (members) or by managers, unlike corporations which have a board of directors who oversee the major business decisions of the company and officers who manage the day-to-day affairs.

  • Few restrictions. There are few restrictions on who can be an LLC owner or how many owners an LLC may have (unlike S corporations).

 

Corporate Businesses

Corporation

A Corporation is a more complex business structure. A corporation has certain rights, privileges, and liabilities beyond those of an individual. Doing business as a corporation may yield tax or financial benefits, but these can be offset by other considerations, such as increased licensing fees or decreased personal control. Corporations may be formed for profit or nonprofit purposes. Filing with the Washington Secretary of State is required.

 

Nonprofit Corporation

A Nonprofit Corporation is a legal entity and is typically run to further an ideal or goal rather than in the interests of profit. Many nonprofits serve the public interest, but some engage in private sector activities. If your nonprofit organization is, or plans to, raise funds from the public, it may also be required to register with the Charities Program of the Washington Secretary of State. Charitable activities may require additional registration. Contact the Office of the Secretary of State for more information.

 

Benefits of a Corporation

  • Limited Liability – Corporations provide limited liability protection to their owners (who are called shareholders). Typically, the owners are not personally responsible for the debts and liabilities of the business; thus, creditors cannot pursue owners’ personal assets, such as a house or car, to pay business debts. Conversely, in a sole proprietorship or general partnership, owners and the business are legally considered the same and personal assets can be used to pay business debts.

  • Tax Advantages – Corporations often gain tax advantages, such as the deductibility of health insurance premiums paid on behalf of an owner-employee; savings on self-employment taxes, as corporate income is not subject to Social Security, Workers Compensation and Medicare taxes; and the deductibility of other expenses such as life insurance. For information on the types of tax advantages your business may gain by forming as a corporation, consult an accountant or tax advisor.

  • Establishing Credibility – Incorporating may help a new business establish credibility with potential customers, employees, vendors and partners.

  • Unlimited Life – A corporation’s life is not dependent upon its owners. A corporation possesses the feature of unlimited life, meaning if an owner dies or wishes to sell his or her interest, the corporation will continue to exist and do business.

  • Transferability of Ownership – Ownership in a corporation is typically easily transferable. (However, there are restrictions on S corporation ownership).

  • Raising Capital – Capital can be raised more easily through the sale of stock. Additionally, many banks, when providing a small business loan, want the borrower to be an incorporated business.

  • Retirement plans – Retirement funds and qualified retirements plans, such as a 401(k), may be established more easily.

 

  1. Wait for processing and your UBI number.
    If you filed online, your filing will be processed within 3 days. If you file by mail without expediting, it may be up to 3 weeks to receive confirmation. The Secretary of State will send you an email confirming that your business is formed, and providing you with your 9-digit UBI number. UBI stands for “Unified Business Identifier,” which means that multiple Washington state use the UBI to identify your business. The key is to make sure you receive your UBI number from the Secretary of State—otherwise you could get duplicate numbers from multiple agencies, and you may waste valuable time trying to sort that out, instead of forming your WA company.

  2. Submit your master Business License Application.
    With your UBI number, you’re ready to apply for your business license—that isn’t really a business license—with the Business Licensing Service. The Master Business License Application is really a business registration that lets each related agency know what you’re up to, so you can pay taxes, employment insurance, etc. In some cases, you can file this application online (with 2-day processing), and in other cases, you must file by paper (up to 21-day processing).

It’s important to fill this 4-page application out with care, because the way you fill out each section alerts specific agencies to the reports, fees and other requirements you’ll need to submit to them. The last thing you need is extra paperwork, zero returns, etc.

  1. Apply for other licenses and permits.
    Depending on what business you’re in, you may be able to apply for your specialty license with your Master Business License Application. See the links below to learn about which specialty licenses you can apply for at the same time as the master business license, and which ones will require you to file by paper. In some cases, additional fees and paperwork will still be required even if your specialty license is included, but you’ll receive a packet of information from the proper agency.

Most WA cities require you to get a license to do business within the city limits. You may apply for a license for a few cities via the Master Business License Application. You may also need to apply for zoning and permits, or a contractor’s license depending on the scope of work of your business.

  1. Obtain a Federal Tax ID Number (EIN).
    If you will need to pay federal taxes as a business or will have employees, you are required to get an EIN. You can obtain one yourself 
    online, or hire us to get one for you.

  2. File your Initial Report.
    For WA State corporations and LLCs, an initial report is due 120 days after the day you filed your formation document. If you filed online, you can file your initial report online as well. You’ll need your UBI number and the application ID you were given during your online filing process when you formed your business.

  3. Pay taxes to the Department of Revenue.
    If you checked certain boxes on your master business application, you should be receiving a packet of information from the Department of Revenue. Washington State has no personal income tax, but they do have what’s called a B & O tax on your gross income. Find out more on our 
    Washington taxes page.

  4. Get Workers’ Compensation and Unemployment Insurance
    If you have employees and indicated that on your master business license application, the WA Department of Labor & Industries will automatically set up a workers’ compensation account for you. Then the WA Employment Securities Department will set up your unemployment insurance account. Within 2 weeks, you’ll receive information packets from L&I and Employment Securities, including how much money to deduct from employees’ paychecks, quarterly report instructions, your workers’ comp rate, and workplace health and safety information.

  5. Keep in compliance.
    The state of Washington requires what they call an annual license renewal, or annual report, every year. The Secretary of State has the Business Licensing Services handle it for them. The fee is $71, and you may file online. Your registered agent will receive an Annual Renewal Notice in the mail with a password that you’ll need to log in to the online filing system. This renewal notice will arrive 45 days before the due date, which is the last day of the month you formed your company—your anniversary month.

 

Whether you are opening a brand-new business, making changes to your existing business structure, or hiring employees for the first time

Start Questionnaire

Baldwin Legal Group is here to help you!