How to Start Your Own LLC in Virginia

This guide provides a comprehensive, step-by-step approach to forming your LLC in Virginia, including naming your business, filing the Articles of Organization, establishing a registered agent, securing licenses, and managing taxes.

1. Name Your Virginia LLC

Choosing the right business name is a critical first step, as it defines your brand and creates your first impression with clients.

Start by clearly defining your business concept. A well-defined idea makes it easier to brainstorm names that reflect your services or products. You can then seek input from trusted friends or colleagues to gauge potential reactions to your name ideas. Conduct online searches to ensure that your preferred names do not conflict with existing businesses and that a suitable domain name is available.

Virginia requires your LLC name to include "Limited Liability Company" or one of its abbreviations (LLC or L.L.C.) and prohibits names that could be confused with government agencies. Certain words like bank, insurance, or university require approval. Additionally, your LLC name cannot mislead people into thinking your company is a corporation or partnership and cannot include restricted terms such as "United States," "Federal," or "Reserve" without authorization.

After narrowing your choices, check the United States Patent and Trademark Office to ensure your name is available nationally and not trademarked. Once confirmed, you can reserve your name with the Virginia State Corporation Commission (SCC) through the Clerk's Information System (CIS). Name reservation costs $10 and is valid for 120 days.

Doing Business As (DBA)

If you want to operate under a name other than your LLC, you can register a DBA, known as a fictitious name in Virginia. This allows you to expand product lines or maintain multiple brand identities under one LLC. For example, an LLC named "JJ's Waffles" could operate "JJ's Muffins" as a DBA. DBAs enable you to open separate bank accounts for each business name. Filing a fictitious name costs $10 and is completed through the same CIS portal used for name reservation.

2. Select a Registered Agent

Virginia law requires every LLC to designate a registered agent who can receive official correspondence, legal notices, and tax documents. A registered agent may be an LLC member, a Virginia resident, or a professional registered agent service.

To qualify, a registered agent must:

• Be at least 18 years old
• Have a physical address in Virginia (P.O. Boxes are not accepted)
• Be available during standard business hours

Many business owners hire a registered agent service to ensure compliance and maintain privacy. Choosing yourself as a registered agent means you must be available at your business address during business hours.

3. Determine Your Management Structure

LLCs in Virginia can be member-managed or manager-managed.

In a member-managed LLC, all members actively participate in daily operations and decision-making. This structure is ideal for small LLCs where members are hands-on.

In a manager-managed LLC, one or more designated managers (who may or may not be members) oversee operations, while other members remain passive. This is suited for LLCs with multiple investors who prefer a hands-off role.

If your LLC does not specify a management type in the Articles of Organization, it defaults to member-managed.

4. File Articles of Organization

The Articles of Organization formally establish your LLC with the Virginia State Corporation Commission. You can file online via the SCC's Clerk's Information System or submit paper forms by mail.

Required information includes:

• LLC name
• Principal office address
• Registered agent name and office address
• Whether your LLC is member-managed or manager-managed
• Duration of the LLC (perpetual is common)

The filing fee is $100. Online filings typically receive confirmation within 2–5 business days, while mail filings take 1–3 weeks.

Virginia SCC Contact Information:
Website: Virginia SCC
Phone: (804) 371-9733
Mailing Address: P.O. Box 1197, Richmond, VA 23218

5. Draft an Operating Agreement

Although not legally required in Virginia, an operating agreement is highly recommended. This document outlines your LLC's internal rules, management structure, profit distribution, and procedures for handling disputes or member changes.

Key elements typically include:

• LLC name, address, and duration
• Registered agent information
• Membership details
• Management and voting procedures
• Profit and loss allocation
• Procedures for member changes or disputes
• Recordkeeping and communication protocols

Even single-member LLCs benefit from having an operating agreement, as it helps establish your business's legitimacy with banks, landlords, and potential investors. Templates are available online, but a professional attorney can ensure compliance and clarity.

6. Obtain an Employer Identification Number (EIN)

An EIN from the IRS is required for LLCs with more than one member or those hiring employees. It is also necessary for opening a business bank account and filing federal taxes.

The IRS designates a "responsible party" who controls the entity's funds and assets; this must be an individual, not another entity. Applications can be completed online, by mail, or fax.

7. Obtain Business Licenses and Permits

Depending on your industry and location, you may need federal, state, or local licenses and permits. While Virginia does not issue a general business license statewide, certain professions such as contractors, childcare providers, and health services require licensure.

You may also need:

• Building and zoning permits
• Health or fire permits
• DBA/fictitious name registration
• Sales tax permits if selling taxable goods or services

Always verify requirements with local city or county offices, and consider consulting a business attorney to ensure full compliance. Services like MyCorporation can assist in securing all necessary permits.

8. Choose Your Tax Status

By default, Virginia LLCs are pass-through entities. Profits and losses flow to members' personal tax returns, avoiding corporate taxation.

Default Tax Treatment

• Single-Member LLC: Taxed as a sole proprietorship; income reported on Schedule C. Self-employment taxes apply.
• Multi-Member LLC: Taxed as a partnership; must file Form 1065, with income allocated to members' personal tax returns.

Optional Corporate Tax Elections

LLCs may elect corporate taxation for strategic benefits:

• C-Corporation: Pays corporate tax on profits. Dividends to members are taxed separately, avoiding self-employment taxes on distributions.
• S-Corporation: Income passes through to members' tax returns, but members must receive a reasonable salary subject to payroll taxes, with remaining profits exempt from self-employment tax.

Consult a tax professional to determine the optimal structure for your LLC.

Other Requirements

Open a Business Bank Account

Separate personal and business finances to protect your liability shield. Banks typically require your EIN and Articles of Organization.

Business Credit Card

Establishing credit for your LLC can help manage cash flow and qualify for future loans or lines of credit.

Business Insurance

Protect your investment with general liability, professional liability (E&O), workers' compensation, property, equipment breakdown, commercial auto, or a combined Business Owner's Policy (BOP).

Recordkeeping

Store formation documents, operating agreements, vendor contracts, and other legal or financial records securely.

Annual Registration Fee

Virginia LLCs must pay $50 annually to maintain good standing. Late payments incur a $25 penalty.

Virginia LLC FAQs