How To Form an LLC In Virginia (VA)?

Business trade publications and news organizations name Virginia as one of the top states in the US for businesses. So, it’s no wonder so many entrepreneurs want to learn how to form an LLC in Virginia.

If you’re one of those people, we’ll guide you through the entire process. While the process of forming your LLC in Virginia can be daunting and time-consuming, this guide will break down all the steps of starting your Virginia LLC. Read on to learn more!

Pick a Name for Your Business

The first step in forming your LLC in Virginia is to choose a name for your business.

There are many pointers you should use to guide you in choosing a perfect name for your Virginia LLC. First, select a name that accurately represents your business activities and values. Next, make sure the name is memorable and easy to pronounce.

You’ll also need to ensure your business name complies with the naming requirements and guidelines in the United States. These include the following:

• Your LLC name should be unique and distinguishable from the names of other LLCs operating in Virginia.
• The chosen name must describe the structure of your Virginia business by including one of the following phrases at the end: “LLC,” “limited liability company,” or “L.L.C.”
• Restricted words, such as University, Trust, Charity, Bank, etc, will require extra paperwork or a licensed professional, such as a lawyer or doctor, to be part of your Virginia LLC.
• The chosen Virginia LLC name must not include words that may confuse your business entity with government agencies.

Ensure your chosen LLC name is available in Virginia and that no other business entity has already acquired it by running a Virginia business name search on the state website.

You may want to establish an online presence after forming your LLC. So, we recommend checking if your chosen business name is available as a web domain.

Hire a Registered Agent

If you are forming an LLC in Virginia, you are legally required to nominate a registered agent to receive and forward legal and state correspondence documents on your behalf.

A registered agent is a company or person authorized to do business in Virginia. There are some requirements that a registered agent must meet. These include having a physical street address in Virginia, being over 18 years old, and being available to work during regular working hours.

You can nominate yourself to serve as your LLC’s registered agent. However, this can be a potentially risky and time-consuming task. That is why we recommend hiring a third-party registered agent service provider.

Here are our best three recommendations for a registered agent in Virginia:

ZenBusiness

Ranked #1 on Investopedia and Forbes, ZenBusiness is a reputable name in the registered agent industry. It offers a range of registered agent services, including mail forwarding, a personalized dashboard, document scanning, and email notifications.

Their annual cost is $199, although you can choose to upgrade this standard package to include more services, such as document submission and annual support alerts.

IncFile

IncFile is a perfect registered agent option if you want to purchase an LLC formation package. For instance, any business owner who hires IncFile as their LLC formation company will get a complimentary year of free registered agent services.

In terms of the compliance features offered by IncFile, you will get access to a digital personalized dashboard, tailored email and SMS notifications, and automatic mail forwarding.

A year of IncFile’s registered agent services costs only $119.

Northwest

Northwest is another popular option for a registered agent in Virginia. Combining affordability with practicality and flexibility, Northwest will give you access to all the compliance and registered agent features at an affordable price.

Their annual fee is $125, and in return, you will get scanned documents, document storage, report reminders, and pre-filled forms.

Northwest is popular for its excellent customer support, known as Corporate Guides. These professional compliance experts will help you with any issues or questions about compliance and registered agent services.

If you hire Northwest’s registered agent services in 4+ states, you will be eligible for a reduced or discounted fee of $100.

File Your Article of Organization

On top of hiring a registered agent, every LLC owner in Virginia must register their business as a legal entity with the Virginia State Corporation Commission.

The easiest way to register your Virginia business is by filing the Article of Organization online via the Virginia Online Business Formation Portal. Just click the link, fill out the form and pay the filing fee of $100.

Alternatively, you can file your Article of Organization by mail. To do this, you must first download and fill out the Virginia LLC Articles of Organization Form. Then, send the filled form with a money order or check for $100 to the following address:

State Corporation Commission, Clerk’s Office
P.O. Box 1197
Richmond, VA 23218-1197

Your Article of Organization should include details, such as the location of your business, basic details about your hired registered agent, the intended purpose of your LLC, etc.

Draw Up an Operating Agreement

An operating agreement for your Virginia LLC is a legal document defining your LLC’s operating procedures and ownership.

While drafting a comprehensive operating agreement is not an official or legal requirement by the state of Virginia, creating one protects your LLC and makes it easier to run your business. For instance, an operating agreement prevents disputes and conflicts as it outlines all the obligations of every member and keeps all members on the same page regarding the operation of the LLC.

A well-created operating agreement should include vital details. These include the roles and responsibilities of each member, profit and loss distribution, procedures for removing and adding members, voting rights, and ownership percentages.

While you can use the free online operating agreement templates and samples to create one for your LLC, we recommend hiring a legal expert to review it and ensure it complies with the state laws in Virginia.

Get Licenses and Permits

After creating an operating agreement, you must acquire business permits and licenses to legally operate your LLC in Virginia.

The specific permit and license you require will depend on your LLC’s location and kind of business or industry. For example, if your LLC sells taxable goods and services, you must obtain a sales tax permit, popularly known as a seller’s permit.

It is also vital to note that some licenses and permits are distributed at the local government level. Therefore, check with your county or municipality to ensure you have all the permits and licenses you need.

You can check the Virginia Business Licensing website to learn more about the licensing fees and requirements.

Acquire a Federal Tax IDs

Almost all LLCs in Virginia are required to acquire an Employer Identification Number (EIN), which is like a social security number for your business.

Not every LLC requires an EIN. LLCs that are taxed as separate business entities and have employees are those that are legally obliged to acquire an EIN.

Even if your Virginia LLC doesn’t require an EIN, acquiring one comes with several perks. These include making it easier to open a business bank and credit account for your LLC, manage taxation, hire employees, and file the necessary taxes.

Acquiring an EIN is easy, just apply via the IRS website.

Open a Business Bank Account

While this step is optional, opening a business bank account for your Virginia LLC is vital in separating your LLC finances from your personal ones.

There are many other benefits of opening a business bank account. For beginners, your expenses and income will be better organized. It will also help you keep track of your LLC’s taxation requirements.

To open a business bank account in Virginia, check with your preferred financial institution to see what is required. While each financial institution has its own requirements for opening a bank account, most banks need your EIN and a small opening deposit. You may also need an operating agreement and an article of organization.

We recommend the following three financial institutions in Virginia:

• Virginia National Bank
• Freedom Bank of Virginia
• Virginia Partners Bank

Obtain Virginia Business Insurance

Insurance is essential to operating your Virginia LLC, as it protects your LLC, your LLC members, and yourself.

Like most states in the US, Virginia does not require LLCs to have general liability insurance. However, there are other insurance policies that you should consider purchasing.

For example, through the Virginia Workers Compensation Commission (VWCC), the State of Virginia requires LLCs with two or more employees to purchase a workers’ compensation insurance policy. This insurance protects workers against on-the-job injuries, illnesses, and even death.

Property insurance is another vital insurance policy you should consider purchasing. Landlords will need this insurance policy if you are renting their commercial space. It will pay to rebuild in case of a fire, vandalism, theft, or natural disaster.

Get a competitive quote for your Virginia insurance needs by consulting a comparison site like Insureon.

Buy an LLC Formation Package to Speed Up the Process

If all the steps above appear complex, challenging, and time-consuming, you can purchase an LLC formation package to streamline and speed up the process. Fortunately, many companies offer affordable yet professional LLC formation services.

Some companies, such as IncFile, offer to form your Virginia LLC completely free. All you will need to do is pay the state filing fee. In return, you will get all the features and resources that will streamline the formation of your LLC in Virginia.

If you have a budget for forming your LLC, you may want to purchase Northwest’s LLC formation package. Their services include the popular Corporate Guides that will walk you through all the complex steps. Its cost is $225.

There are also many other LLC formation companies, such as LegalZoom, that offer both free and premium packages. For instance, the Basic package is entirely free. If you want an expedited LLC formation process, consider its Pro package ($249) or Premium package ($299).

FAQs About Forming an LLC in Virginia

How Long Will It Take to Form My Virginia LLC?

You can expect your LLC in Virginia to be ready in 2-5 working days if you file your article of Organization online or two weeks by mail. You can also pay for the expedited processing if you want your Virginia LLC formed faster.

How Much Does It Cost to Set Up an LLC in Virginia?

Setting up your LLC in Virginia costs only $100. This is the fee for filing your Article of Organization. You may incur additional costs, such as the fee for obtaining licenses and insurance policies, which vary depending on the location and type of business.

Can I Act as my Own Registered Agent in Virginia?

Yes. Virginia state laws allow you to nominate yourself as your own LLC registered agent. However, you must fulfill all the requirements of being a registered agent in Virginia. These include being 18+ years old, working during regular business hours, and having a street address (not a P.O. box) in Virginia.

Can I Form a Single-Member LLC in Virginia?

Yes. By following the steps outlined in this guide, you can easily form your single-member LLC in Virginia. However, you must meet the guidelines and legal requirements of forming a single-member LLC in Virginia.

Conclusion

Forming a Virginia LLC is a relatively affordable and straightforward process that you can complete in only a few steps. Virginia will give you access to template forms to simplify the paperwork and streamline the process. However, if you find any step daunting or time-consuming, buy an LLC formation package to speed up and streamline these steps.

Also see:

• Virginia (VA) Secretary of State (SOS) LLC & Business Search
• Virginia (VA) Registered Agent Services
• How To Find Virginia Bookkeepers