How to Start an LLC in Virginia: Cost and Registration Steps

Distinguished by a rich history, Virginia is one of the oldest US states, which is strong both culturally and economically. Its diverse terrain with valleys, mountains, rivers, and long coastal areas creates great conditions for shipbuilding, marine business, seafood harvesting, tobacco growing, and winemaking.

Besides, today, Virginia is a home for multiple technological companies thanks to its proximity to Washington D.C. and high educational potential.

As such, Virginia has a high state ranking and attracts both big national companies and startuppers. It’s a great place to start your smaller business and become a part of a thriving community. If this is what you are going to do and you’ve chosen an LLC as a legal structure for your future business, our article will provide answers to all the questions you might have about how to start an LLC in Virginia:

• Steps you need to take to bring your Virginia LLC to life;
• Tips on how to give your LLC the right legal start and support it the right way;
• Compulsory regulations to match to stay compliant with the state and skip any law problems. 

In fact, below, you’ll get a detailed plan for not only forming but also maintaining an LLC to initiate your business in Virginia and smoothly run it afterward. So, keep on reading.

How to Get an LLC in Virginia: Step by Step

Step 1: Name your Company

Just like you’d give a name to your kid, you need to pick a name for your future venture too. Not only is it some kind of ritual or tradition but also it’s a legal requirement. An LLC cannot be registered without a name, hence, choosing a moniker for your prospective company is the very first step you need to take.

Words You Have to Use

Just like you’d give a name to your kid, you need to pick a name for your future venture too. Not only is it some kind of ritual or tradition but also it’s a legal requirement. An LLC cannot be registered without a name, hence, choosing a moniker for your prospective company is the very first step you need to take.

While sticking to the state naming regulations is important, creating a really good name for a company is easier said than done. Wonder how to invent an LLC moniker that will work for your business and come to your liking? We have a few helpful tips for you

• Don’t contemplate too much: Too much thinking is not always good. Put down all the quick ideas you have in your head. It will let you spot the versions you like the most;
• Focus on the principle message: It’s great when you are allowed to be creative and use all your imagination. However, this way, you can go wild and distract from the main message your company name should deliver. Being your company business card, an LLC name should relate to the activity you are engaged in. So, it shouldn’t be vague or too neutral;
• Be original yet simple: To let your LLC stand out from the crowd of competitors, you need to be different and original. However, original doesn’t mean complicated or too tricky. Stay simple and use acronyms, foreign words, and fancy combos to look interesting and catchy;
• Stay away from popular company names: There are big company names that are well-known nationwide and even worldwide such as McDonald’s, Amazon, Google, Apple, and alike. While it’s nice to get inspired by those companies' success, it’s better to avoid any reminiscence of those names in your LLC moniker. Not only will it feel misleading but also it can cause unwanted legal disputes.

Words You Can’t Use Starting an LLC in Virginia

While you are not too limited in your naming endeavors, there are still some rules you’ll have to follow. LLC laws are state-specific and the same is true for naming regulations. Most often, those are standard rules, yet, some states might have peculiarities in this concern. Hence, checking the state dos and don’ts is a must if you want to name your company properly, without breaching the law.

If you do need to get a license to perform some types of activities, it’s recommended that you consult the State Corporation Commission to ensure that your projected LLC name is fully compliant with the current state laws in this area. This will help avoid licensing issues and any related problems in the future. 

In Virginia, business naming rules fall within the purview of Virginia Code Section 13.1-1012. The naming requirements set forth in this document are as follows:

• Traditionally, an entity identifier is to be a part of a company name. “Limited Liability Company”, “Limited Company” or any abbreviated versions should be included in the registered name of your future enterprise;
• Rude, offensive, and humiliating words are unacceptable, as well as words showing intolerance, racism, or any expressly negative attitude to certain social, religious, or national groups; 
• You can’t mention other entity identifiers in your LLC name. Thus, using the words “incorporated” or “partnership” is forbidden;
• LLC names are not allowed to contain references to governmental, educational, and financial structures. You should steer clear from such words as “police”, “university”, “school”, “bank”, “trust”, etc.;
• Some professional terms are also under ban. Thus, you need to be careful while using the names of certain professions in your LLC moniker since many of them require specific permissive documents to be used. To use the terms “attorney”, “barber”, “engineer”, “plumber”, or “clinic”, you should have an appropriate license and be qualified for the job;
• A rule of thumb for LLC names is distinguishability. Virginia law calls for your LLC name to be different from any other company names already registered in the state or reserved for future registration. It means if some name has been put on hold and is not even in the rotation yet, you are not permitted to use it.  

Pay attention to the fact that by introducing articles, conjunctions, suffixes, prefixes, punctuation marks, or switching to abbreviations, plurals, or capital letters you won’t make a company name unique. What does help, though, is adding personal names or juggling with keywords and synonyms.

Research the LLC Name You Want

To keep up with the distinguishability rule when choosing a name for your Virginia LLC, you need to find out if the name you want is available in the state. For that purpose, you’ll have to perform a name search before filing your LLC with the state. Our recommendation is that you don’t neglect this aspect since should your LLC name fail to be unique in Virginia, your LLC formation will be rejected. There are several ways you can check a business name and we suggest that you use all of them:

• Google the name versions you have an eye on to see if some other companies use anything similar in Virginia or any other states;
• Use a free search tool available on the website of the Virginia State Corporation Commission to monitor registered business names in the state. There is also an expanded search to dig deeper and look through related documents and papers;
• Check the trademark database to see if some entity has trademarked the name you want. In case the moniker you have in mind is used as a trade or brand name, you might still be able to register it as an LLC name, yet, you won’t be able to trademark it further on.

Virginia DBA: Using a Fictitious Business Name

It might happen that the name version you like the most is already occupied in Virginia, and you’ll have to choose some other name option for business registration to stay compliant with the rules. Don’t get upset, though. You can get one more name for your LLC in Virginia, and it’s all legal. A DBA (doing business as) name is a fictitious, assumed or so-called trade name that still refers to your LLC but is different from the registered name that appears in your formation documents.

Apart from matching your individual preferences, a DBA has a number of quite tangible business benefits:

• DBAs are great for marketing and promotions. You can skip a compulsory “LLC” tag in a fictitious name, which is nice for setting up an attractive trade name that will pop up in advertisements and appear on your marketing materials;
• You can register multiple DBAs for a single LLC, thus, getting an opportunity to launch several product lines or create several brands without the need to form a separate LLC for each of them. Besides, it’s an easy way to expand your business to other areas;
• Changing a DBA name is as easy as filing another one. Meanwhile, changing your registered LLC name will take you quite a bit of legal hassle and paperwork.

With all the pluses it brings, getting a DBA is a breeze. You just need to submit a certificate for a fictitious name with the Virginia State Corporation Commission. And this certificate should include the following basic info:

• The applicant’s name and how he or she relates to an LLC (member, manager, employee, hired representative);
• Your current LLC name;
• A fictitious name you want;
• Your LLC’s ID you should get when filing formation documents.

To make it even easier for you, the Commission’s website has a DBA certificate form you can download and simply fill in the blanks. To register a DBA in Virginia will cost you $10.

Step 2: Appoint a Registered Agent to Create an LLC in Virginia

When the naming hassle is over, it’s time to think about a Virginia registered agent for your limited liability company. This function is not a recommendation, it’s a legal requirement in all US states. And the Virginia Code calls for it as well.

Who is a registered or resident agent? In a word, it’s your LLC’s official representative. To be more specific, it’s a person or entity meant and entitled to receive your legal mail. We are talking rather about services of process than business correspondence overall. Services of process refer to the letters, documents, and papers sent by federal and state authorities and other governmental structures and public entities to your LLC as a legal person. These are lawsuit papers, tax notes, any official requests, statements, notifications, and other similar letters.

The main role of a registered agent is to be always there to obtain those crucial documents in time and hand them to you in a timely manner. Thus, this function becomes vital if your LLC is sued. The law requires complainants and courts to address LLC lawsuits and summons to registered agents. Should they fail to find your agent, you risk losing the lawsuit by default judgment.

Who can be a registered agent for your LLC? Well, The Virginia Code is pretty specific in this concern. You can either be a registered agent for your own LLC or hire a third party for that purpose. A third party is an adult person registered in Virginia or a legal entity registered in this state. There are no strict requirements for the educational and professional backgrounds of individuals. However, an LLC cannot serve as its own registered agent. When delegating this function, entrepreneurs most often choose their attorneys, business consultants, accountants, tax advisors, their LLC employees or hire one of the special registered agent companies for this role.

In our Best Registered Agent review, you’ll find what is a registered agent for LLC and companies that we consider the best in the industry and that will fit varying budgets and needs

Which is a better alternative? Many startuppers and beginner businessmen choose to serve as agents for their own LLCs mostly because it’s affordable. To be more specific, it’s free of charge since you don’t have to pay yourself from your LLC for this job. So, it’s certainly an option for stringent budgets. Besides, it’s a simple and straightforward choice. You don’t have to look for anyone and you’ll have a single address for all communications. Finally, you’ll be the only one to handle your crucial mail, with no other eyes on it.

However, in our opinion, this approach is not the best one since a seemingly simple job can become a true burden over time, not to mention minor problems and inconveniences you’ll face from the very beginning. These are the facts that might persuade you to hire an independent registered agent:

• Pierced Privacy: Do you want your personal data to be out in the open? It’s rather no than yes, right? Serving as your own registered agent, you’ll have to make your data publicly available;
• Huge Mail Flow: Business mail is not only about important letters but also about tons of spam. The bigger your business grows, the more junk mail you’ll receive and the harder it will be to control it;
• Limited Freedom of Travel: Being a registered agent means being bound to your registered address since this role implies being consistently available for receiving regular or express mail during business hours on weekdays. In practice, it will greatly restrict your ability to travel or simply walk out of the office for lunch;
• Peace of Mind: With a hired registered agent on your side, you’ll rest assured your business mail is duly treated, processed, and handled to you. The risk of missed letters is much lower, and your sensitive info will be kept secret.

If these reasons are enough for you to stay with a hired registered agent, we strongly recommend setting your eyes on a professional service. While their service costs about $100 a year, those companies are usually available nationwide. So, you won’t have any problem finding an agent in any US state.

Step 3: File Your LLC Articles of Organization

With a company name selected and a registered agent assigned, it’s high time to proceed to your Virginia LLC registration, which is about filing the Articles of Organization with the state. In fact, this very step will “give birth” to your LLC legally. Once this document is registered and approved by the state, your LLC will be entitled to transact and conduct business as an independent entity. It’s as simple as that, especially taking into account that the Article of Organization is a generic document with standardized content. At the same time, remember that without this formation doc, your LLC has no legal power. So, don’t let things slide and double-check that everything is done right.

While there is nothing in the LLC formation process you can’t handle by yourself, you can entrust this task to an LLC service. The good thing is that a formation company will not only take care of the registration formalities but also settle some post-formation issues. Sounds promising? Then check our Best LLC Formation Services review to find your formation assistant.

What to include in my Virginia Articles of Organization?

Normally, this formation document covers basic company information so to say to introduce your entity to the state authorities and competitors. Despite that, though, the Virginia Articles of Organization content is regulated by law, so you should check it anyway.

Thus, Virginia Code Section 13.1-1011 outline the following data to be included in your Virginia LLC formation documents:

• Full LLC name and registered address;
• Registered agent name and address;
• The address at which you are going to have a principal office of your LLC. Chances are great it will be different from the registered LLCs address;
• Purpose of your LLC (generally);
• Organizer’s name and signature. It’s not necessary that all LLC members be mentioned in the document. It’s enough to specify the name of the person in charge of the filing process.

At the Virginia State Corporation Commission website, you’ll find a downloadable form you can use that will save you the need of creating the Articles of Organization from scratch.

How Much Does Cost an LLC in Virginia? Filing Fee

All states incur fees for reviewing, processing, and approving LLC formation documents. Virginia is not an exception. The filing fee in this state is $100, and you’ll have to pay it when submitting the Articles of Organization. Otherwise, your papers won’t be accepted.

Since you can file either online or by mail, you’ll have two payment options accordingly including a credit card or an eCheck. Unlike with other states, Virginia won’t charge any added interest, whatever the payment method.

Virginia LLC Processing Time

How long it will take the Virginia state department to consider your formation documents depends on the processing option you choose. Default processing time is about 2 to 3 business days, which is noticeably faster than in many other states. Yet, you can further cut it down:

• You can count on next-day processing at $100 subject to submitting the papers before 2 p.m. You’ll get them processed before 4 p.m. the next day;
• At $200, your documents will be approved the same day if you file them before 10 a.m.

Step 4: Draft your Virginia LLC Operating Agreement

The Articles of Organization is your major formation document. Yet, it’s rather proof of your state registration and doesn’t tell much about how to operate and control your newly formed company. An Operating Agreement does. Strange though it might sound, needing no filing, this document is more important in practice than the Articles of Organization. Wonder why? It’s a company bylaw that describes your company structure in detail, stipulates operating procedures, and outlines how you should behave in certain business situations. As such, it’s an operational mantra for any LLC.

The law doesn’t require LLCs to have Operating Agreement. However, we consider it one of the major instruments you need to execute in writing and have it signed by all of your company co-owners. Unless you have this internal contract in place, your business operations will be governed by default laws, which are not always what you need for your day-to-day operations.

Regulated by Virginia Code Section 13.1-1023, the scope of the Operating Agreement should cover the rights and duties of the LLC members and managers, as well as those of third parties such as the company’s clients and vendors. To be more specific, though, an Operating Agreement can cover a lot more issues agreed on by the LLC members. Properly drafted bylaws usually include the following items:

• Membership and management structure and making changes to it;
• Powers and responsibilities of LLC members and owners;
• Rights and obligations of appointed LLC managers;
• Profits distribution and allocation principles;
• Issues that require voting and voting rights of LLC members;
• LLC dissolution procedure.

With an Operating Agreement at hand, you’ll run your company smoothly and easily avoid any internal conflicts or disputes between the members. Besides, amending the document is as easy as getting the changes approved by the members. Meanwhile, the Articles of Organization is a state-registered doc that requires re-registration when amended.

Step 5: Get an EIN (Employer Identification Number)

All individuals have a social security number that allows tax authorities and all governmental bodies to identify them as taxpayers. Companies need this type of coding too. An SSN number analog for business is an EIN. An Employer Identification Number or a Federal Tax ID is issued by the IRS and used as an LLC tracker.

While single-member LLCs are not required to have EINs, multi-member companies should get one straight after formation. However, we think that any LLC should get an EIN since you’ll need it sooner or later anyway. Hiring employees, paying excise taxes, opening a business bank account, selecting a corporate tax status for your LLC, all these activities call for an EIN.

Applying for an EIN is as simple as one, two, three. The whole process will hardly take you more than a few minutes. Visit the IRS website, fill out an EIN application form online, and obtain your number for free almost immediately.

First Tasks After Setting Up an LLC in Virginia

When your Virginia LLC is formed, you might think that the hardest part is over. However, the hardest part is waiting for your ahead. It’s driving your LLC to success. And you need to be fully armed in a legal sense not to revert to those issues afterward.

Open a Business Bank Account

While no one can bar you from using your personal checking account for business purposes, it’s a very slippery path to take. In the eyes of the law and state authorities, it will look like you treat company funds as your own. This way, you’ll put your liability protections at risk and your corporate veil will be pierced, should a lawsuit against your LLC arise.

Apart from those serious reasons, there are more practical ones for setting up and maintaining a dedicated bank account for your LLC. First of all, it’s protecting your individual assets from being used to settle business liabilities since losing the LLC protections will make your own funds vulnerable. Secondly, it’s accounting. Mixed assets are hard to account for. You need to split personal and business expenses and cash flows to get a realistic picture of your company’s financial standing. Finally, it’s crediting opportunities. Business growth often requires investments, yet, banks are reluctant to give loans to businesses with no separate bank accounts.

With that, the most reasonable and efficient approach is opening a separate bank account for your business from the very start.

Get Business Insurance For Your Virginia LLC

Business is not only about profit and growth but also about risks. Business insurance is meant to give your company an added layer of protection for certain unexpected situations or accidents. So, next to setting up a checking account for your LLC, think about the types of insurance to safeguard your venture from future dangers and mistakes.

Common insurance types most often used by different businesses that might be relevant for your enterprise too include:

• General liability insurance to pay for injuries on your property; 
• Commercial property insurance to protect your company assets from damages;
• Professional liability insurance for LLCs operating in certain areas or industries to get the defense in case of professional malpractice;
• Workers compensation insurance for employers to cover on-the-job injuries for their employees;
• Business income insurance to get a “lifebelt” for the loss of income.

Keep Your Company Compliant

Staying compliant with state rules is important to maintain your LLC’s eligible status. Hence, there is a number of law requirements all LLCs should match in the course of operation.

Virginia Business Permits and Licenses

Most likely than not, your Virginia LLC will need some sort of license or permission. While the state doesn’t require LLCs to get a general business license, county and city rules vary in this concern. So, it’s advisable that you check locally before starting business transactions to avoid unwanted fines. Health permits, zoning permits, liquor licenses, seller’s permits, professional licenses, and home occupation permits are to name a few.

Virginia Tax Requirements

Similar to individuals, companies are obliged to file taxes annually. The benefit of LLCs is that they are taxed as pass-through entities, i.e. income taxes are payable on personal tax returns of the company co-owners. However, there is a whole range of other taxes your business might be exposed to if you hire employees or are engaged in commercial activities. Hence, it’s highly recommended that you consult your accountant or tax specialist on this issue to get a detailed list of all taxes and charges you are to report.

Annual Report and Other Filing Requirements

By way of contrast, Virginia is one of a few US states that have no annual reporting requirements for LLCs. Yet, you’ll still have to pay a registration fee of $50 once a year to maintain your state registration.

Virginia Business Formation Quick Links

• Virginia SCC — Expedited Services
• Virginia SCC — Online Portal Business Sign-In/Clerk’s Information System
• Virginia SCC — Form Articles of Organization
• Virginia SCC — Form Certificate of Assumed or Business Name (DBA)
• Virginia Tax — How to File and Pay Sales and Use Tax
• Virginia Tax — Online Services for Businesses
• Virginia Workers’ Compensation Commission — Information for Employers
• IRS — apply for an EIN online
• IRS information regarding the federal tax treatment of LLCs
• Virginia Code Title 13.1, Chapter 12 — Virginia Limited Liability Company Act
• Virginia Code Title 59.1, Chapter 5 — Transacting Business Under Assumed Name (DBA)
• Virginia Department of Professional and Occupational Regulation
• Virginia SCC — Annual Registration Fees
• Virginia SCC — Business Entity Search

FAQ About Virginia LLC Registration