Think about your LLC a year from now: raking in profits and taking West Virginia by storm. You have big plans, but before your business can officially take off, you’ll need to make a bit of an investment.
And we’re not talking about renting office space or paying employees – before you sell a single product, there are startup costs associated with launching an LLC in West Virginia.
While you’re making plans and dreaming big, make sure that you consider all the possible costs associated with starting an LLC. To help you out, we’ve compiled the most common West Virginia startup fees here.
Quick Note: If you’d like to keep your costs of starting an LLC as simple and low as possible, consider hiring ZenBusiness – a reliable business formation service. To get a better idea of the value they offer and how it works, we compared them to the two most well known services:
Bare Minimum Cost to Start an LLC in West Virginia
Optional: LLC Name Reservation Fee
- $15 for an online or paper filing. Expedited processing options: 24-hour ($25), two-hour ($250), and one-hour ($500)
Required: Articles of Organization Fee
- $100 for an online or paper filing. Expedited processing options: 24-hour ($25), two-hour ($250), and one-hour ($500)
Overall West Virginia LLC Formation Costs
LLC Name Reservation Fee
You’re not required to reserve a business name as part of the LLC formation process. It’s completely optional. If you have a great name in mind but aren’t ready to start your business, consider filing a name reservation. It costs $15 and will hold your desired name for 120 days. If you’re ready to get your business off the ground, though, skip this step and go straight to the Articles of Organization, which will automatically register your name.
Articles of Organization Fee
This is the big one, the most important (and most expensive) form that you’ll file to start your West Virginia LLC. Filing the Articles of Organization will formally register your business with the state and allows you to do business in the state, so submit it as soon as you’re ready. At $100 to file online or on paper, it’s not cheap, but the good news is that this is a one-time filing, so you won’t have to pay this fee again.
Business and Professional Licenses
Even after successfully filing your Articles of Organization, you may need to take one more step before conducting business in West Virginia. Depending on the type and location of your business, you may need to obtain licensure from a state agency or city government. Landscape architecture companies, for example, must apply for licensure through the State Board of Landscape Architects, and chiropractors need to get a license from the Board of Chiropractic.
Additionally, cities and/or counties often have their own licensure laws. Check with the West Virginia Association of Licensing Boards website, the West Virginia Division of Labor website, and your local government to see which licenses your LLC needs.
LLC Formation Service
Starting an LLC can be a complicated and time-consuming process. If you want to spend less time on paperwork and more time planning your business, you might opt for an LLC formation service. These services take care of the registration process for you, so you don’t have to spend the time on research, paperwork, and filings.
Most of these services (like ZenBusiness and Northwest) offer basic LLC formation service like Articles of Organization filing, tax consultations, and phone/email support for a flat rate, with options to pay more for premium packages with premium services like Employer Identification Numbers, Operating Agreements, and expedited filing.
Agent of Process (Registered Agent) Service
Appointing an agent of process is an important part of your LLC formation process. Your agent of process is responsible for handling sensitive legal and tax documents and keeping your business compliant with West Virginia business law. In short, you need an agent you can trust.
While you can be the agent of process for your own LLC, this puts pressure on you to keep up with business filings and potential legal disputes. Sometimes it’s better to hand off that responsibility to a professional. A agent of process service ensures that your annual reports and other forms are filed efficiently and on-time, saving you from the penalties of delinquent filings and the stress of having to do it yourself.
Not all agent of process services are equal, so you’ll need to be careful in choosing one. Fortunately, we’ve done some research for you, and we recommend Northwest Registered Agent. In addition to agent of process services, Northwest also handles LLC formation — and they’ll include a registered agent free for one year when you form your business with them. We think they’re the most reliable choice, but if you’d like to evaluate all your options, check out our Best Registered Agent Services guide.
If you have questions or concerns about the LLC formation process or if it’s the best business structure for you, sometimes it’s best not to take chances and consult an attorney. They’re not cheap, but they can provide essential business advice, professional filing assistance, and peace of mind.
Some attorneys offer free consultations (usually 30-60 minutes) but will charge by the hour after that. On average, business attorneys charge between $150-350 per hour. Some will offer a flat rate for setting up an LLC, which can range from $500-2000.
Cost variations depend on the experience and location of the lawyer. You will want to do some research to make sure that you’re finding a great fit for your LLC. A website like Avvo can be a huge help. It allows you to access a database of West Virginia business attorneys, so you can compare their locations, rates, specialties, and make sure you’re making the right hire.
Foreign Qualification Fee
This only applies if your LLC was formed in another state and is now expanding into West Virginia. Is this your business? If so, you must file an “Application for Certificate of Authority” rather than the Articles of Organization.
All foreign business entities are required to foreign qualify in West Virginia, or they could incur some pretty severe penalties. Avoid them by filing an Application for Certificate of Authority either online or with a hard copy. The fee for either method is $150, but like the Articles of Organization, it’s a one-time filing and payment.
LLC Annual Fees
Aside from all the startup costs for your LLC, there are also yearly maintenance fees to keep it in good standing, namely the Annual Report. The Secretary of State requires all LLCs to file an Annual Report between Jan. 1 and Jul. 1 each year. You can file online or using a hard copy, and each report costs $25, so write that small fee into your annual budget.
By default, LLCs are classified as “pass-through” entities on the federal level, meaning that they don’t file separate corporate tax returns. Instead, the individual owners/members report income and losses on their personal returns. The same goes for state income taxes.
But that doesn’t mean your LLC is completely off the hook. If it maintains employees, it will owe a Withholding Tax and an Unemployment Tax. Further, if your LLC sells merchandise, it will need to pay a Sales Tax and Use Tax. Register for these taxes online or by mail. There is a $30 registration fee.
It’s a little less common, but if you’ve set up your LLC to be taxed as a corporation it will be subject to the 6.5% corporate income tax. See the West Virginia Tax Department website for more information.
What If I Don’t Pay?
Looking at all these fees, you might be thinking: how can I pay less? While you might be tempted to look for loopholes or find a way around them, this could cause you bigger problems in the future.
If you don’t file the appropriate formation documents – the Articles of Organization or the Application for Certificate of Authority – you won’t be able to start doing business in the state. And once your business is up and running, missing an Annual Report will incur a $50 penalty and cause you to lose your good standing with the state. Businesses without good standing cannot foreign qualify in most other states, apply for business loans, renew some professional licenses, and more. Fail to reconcile any missed filing or fee causing a loss of good standing within 60 days and the state can administratively dissolve your LLC.
Failing to pay taxes in a timely manner has its own set of penalties. For each month a tax is overdue, the state will add 0.5% of the total amount owed (up to 25%). If a tax is overdue because of “negligence or intentional disregard of rules,” the state will add 5% of the total amount owed per month (up to 25%). Read over this document on penalties and interest to learn more.
Planning Your Expenses
By now, your budget spreadsheet might be looking a little crowded, but have no fear! Most of these are one-time fees that you won’t have to worry about again. Plus, with all these on the books, there won’t be any surprise costs when you register an LLC in West Virginia.
Soon, you’ll have these fees behind you and you’ll be forging ahead, growing your business and earning profits. As you do, make sure to keep up with the few recurring fees – like Annual Reports – so your business doesn’t fall out of good standing.