Before you form a West Virginia limited liability company (LLC), you should understand the costs. Still, determining what your expenses might be can be tricky. This is partially because the information you need to know is found on several different websites.
That’s why we wrote this article. We’ve summarized all the potential costs of starting a limited liability company in West Virginia.
Read on to find out:
- The mandatory costs of starting a West Virginia LLC
- Other expenses that can help your business
- How to choose the right LLC formation strategy
By the time you have finished reading, you will know the basics about West Virginia LLC formation costs.
Total West Virginia LLC Cost – Starting at $130
According to the West Virginia Secretary of State's Fee Schedule, the lowest possible cost to start an LLC is $130.
This includes two items:
- West Virginia Articles of Organization filing fee: $100
- West Virginia Business Registration Certificate: $30
You may also need professional and local business licenses for your LLC. The costs of these vary.
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West Virginia LLCs – the Basic Costs
The total cost of forming a West Virginia LLC varies. However, the bare minimum cost is $130. We’ve explained what your required expenses might be in the sections below.
Articles of Organization Filing Fee — $100
Articles of Organization are the legal documents that start LLCs. To form an LLC in West Virginia, you must submit them to the Secretary of State. While it sounds complex, it’s really not. All you need to do is list basic facts about your business.
The filing fee for West Virginia Articles of Organization is $100. You can file online or use a paper form.
Business Registration Certificate — $30
Before you can engage in business activity in West Virginia, you need to get a business registration certificate from the West Virginia State Tax Department.
You can apply online or submit a paper application form.
Professional Licenses and Business Permits — Variable
West Virginia requires businesses in certain industries to get state-level business licenses or permits. The Secretary of State’s New Business Startup Wizard can help you determine if your LLC needs a license to operate.
You might also need to get a local permit or business license for your LLC. For instance, the city of Charleston requires all businesses to get business licenses.
West Virginia LLCs – Optional Costs to Consider
In addition to the mandatory expenses discussed above, you should consider some optional costs. While these aren’t strictly necessary, they can benefit your West Virginia limited liability company.
Expedited LLC Filing Fees — $25 to $500
Consider paying for expedited service if you want your LLC paperwork to be processed more quickly. West Virginia offers 24-hour processing for a $25 fee, 2-hour processing for a $250 fee, and 1-hour processing for a $500 fee.
Registered Agent Fee — about $100 per year
All LLCs need to have a registered agent. West Virginia calls this position an “agent for service of process.” Your agent will be responsible for accepting legal papers on behalf of the LLC. You will list your agent on your West Virginia LLC Articles of Organization at no additional cost. But there is a $15 fee if you ever need to change your agent.
New business owners often think the best option is to appoint themselves as their LLC’s agent for service of process. Although this seems logical, doing so can cause more trouble than you think.
Registered agents are required to be available to receive documents during regular business hours. You can’t take a break, and you can’t miss a day. An agent’s address is also publicly available online. This can lead to excessive junk mail and other invasions of your privacy.
For this reason, we suggest that all LLCs use a professional registered agent service. It only costs about $100 annually, and the service will manage all of your LLC’s registered agent duties.
Check out our Best Registered Agent Services article for some of our recommendations.
Operating Agreement — Variable
A West Virginia LLC operating agreement is a type of contract that LLC members use to establish how the company will be run. It includes critical details like the rights and duties of the members and how they can enter or leave the LLC.
West Virginia doesn’t mandate that LLCs make operating agreements. However, we strongly advise that all LLCs have one. While you can make your own operating agreement, it’s advisable to outsource the task to someone with more expertise.
Some business owners choose to have an attorney write their LLC’s operating agreement. This option will ensure your contract is accurate and comprehensive. But be sure to keep the cost in mind. If you want to save money, an LLC formation service can make you an operating agreement for as little as $39.
DBA Fee — $25
Business owners often decide to run their LLCs under “doing business as” or “DBA” names. A DBA is an LLC name that a company uses to go about its daily business. For instance, it’s common to drop the “LLC” from a DBA in order to make the name more casual.
In West Virginia, DBAs are called “trade names.” If you plan to use a DBA for your LLC, you need to submit an Application for Trade Name to the Secretary of State.
You can register your DBA online or file a paper application. There is a $25 filing fee.
Name Reservation Fee — $15
If you have chosen the business name you want to use for your LLC but aren’t ready to start your business, West Virginia law allows you to reserve a name for 120 days. Doing so will prevent anyone else from taking the name during this period.
You need to file an Application for Name Reservation with the Secretary of State to reserve your business name. You cannot file online, so you must use a paper form. There is a $15 filing fee.
Domain Name — about $20 per year
In today’s economy, most modern marketing plans call for a business website. And to make a website for your LLC, you must purchase a domain name. Luckily, domains are easy to get and relatively cheap.
We suggest that you buy your domain as soon as possible. Someone else might claim it first if you don’t get it right away. For instance, “domain squatters” buy domains they think new businesses might want and resell them for a profit.
You can get a domain from GoDaddy.com or a comparable service for around $20 to $50 annually. These websites often run sales, so you can probably get one for even less.
Getting an Employer Identification Number (“EIN”) — Free
An EINs is a 9-digit identification number the Internal Revenue Service assigns to a business. It is comparable to a social security number in that you will use it to identify your company for tax purposes. The law mandates that some LLCs get EINs. Others are not required to do so.
Either way, we suggest that every LLC get an EIN, as having one can help your business. For one thing, most banks require you to use an EIN to open a business bank account. Having an EIN can also help you avoid identity theft because you won’t need to use your SSN as much.
To apply for an EIN for your LLC, go online or mail Form SS-4 to the IRS. Just remember that getting an EIN is always free. So, you should never pay someone to get one for you.
Read More: How to Get an Employer Identification Number in West Virginia
Foreign LLC Qualification Fees — about $100 per extra state
If you want to expand your business into other states, you will have more expenses. You aren’t required to start a new LLC for every state, but you will need to register as a foreign limited liability company wherever you want to do business.
Foreign LLC filing fees vary among different states. Most are about $100.
Writing Formation Costs Off
You can usually deduct your LLC formation costs from your federal income taxes as business startup expenses. The IRS offers a significant amount of guidance on this subject. To learn more, check out the IRS website.
By default, LLCs are classified as “pass-through” entities. This status allows LLC owners to deduct up to $5,000 in startup expenses on their federal income taxes. Keep in mind that this only applies to the year they start the business.
Xenia decides to start a single-member LLC and open a thrift shop in Charleston, West Virginia. Her formation expenses are as follows:
- West Virginia LLC Articles of Organization: $100
- Expedited Filing Fee (24-hour): $25
- West Virginia Business Registration Certificate: $30
- Charleston General Business License: $20
- Operating Agreement: $45
- West Virginia Registered Agent Service Fees: $100
- DBA (trade name) Fee: $25
- Name Reservation Fee (online filing): $15
- Web Domain Costs: $30
As a pass-through entity, the LLC won’t be subject to income taxes. Instead, Xenia will report her earnings from the LLC and any deductions on her personal state and federal income taxes.
Xenia’s total formation costs were $390. Before deducting her expenses, Xenia’s total taxable income was $38,000. But after she deducts her costs, her taxable income is $37,610. This will drop her 2023 federal income taxes from $4,361 to $4,314.
This might not seem like a large decrease on its own. But LLC owners who deduct their expenses will see the savings add up as time goes on.
Cheapest Way to Start an LLC in West Virginia
Choosing an LLC formation method can be a challenging process. To assist you with your decision, we’ve outlined the pros and cons of three common strategies.
Formation Service – $39 + state fees
It’s common for new business owners to use an LLC formation service. While these companies are not staffed with attorneys, they specialize in forming business entities such as LLCs.
A formation service is a great choice for many LLCs. The benefits of this method include:
- They’re easy. In most cases, a formation service will have helped hundreds of people through the exact process you are struggling with now. They have all the documents, information, and expertise you need right on hand.
- They don’t cost much. Because formation services have such a large volume of business, they don’t have to charge their clients that much money.
- They’re reliable. All of the formation services’ products and procedures have been tested hundreds of times over in the real world. That kind of experience should give you peace of mind and confidence going forward.
- They’re fast. Formation services have seen almost every business formation situation already. Chances are, they have many solutions for you that are ready right now before you even know you need them.
Still, formation services aren’t right for all businesses. The negatives of this option include:
- They’re not the best solution for complex LLCs. If you are forming a complicated company or one in a heavily regulated industry, you will have concerns that probably need more focused expertise in that area of business.
- Even if a formation service is a good fit, you can expect upselling. Formation services have to make money too, and some of them may pressure you to buy formation products or business services you don’t need. Even when you are using a formation service, you need to be a smart and informed consumer.
Using a professional LLC formation service can be a great way to set up a business. Check out our Best LLC formation services article for some of our suggestions.
If your business has unique needs or a complicated structure, consider hiring a local business attorney to assist you. Just know that lawyers are not cheap. They typically charge an hourly fee for their services, often at a rate of several hundred dollars per hour.
While they are pricey, attorneys also provide substantial benefits:
- Lawyers help you manage risk. If you are starting a business with complicated legal issues, hiring a lawyer would be the best choice.
- Lawyers offer more customization when you need it. Do you need specific things put in an operating agreement? Is your company going to have a unique ownership structure? You may need an attorney to make sure these issues are handled properly.
However, the disadvantages to this method often outweigh the advantages:
- Lawyers cost more than any other option. The price tag alone should convince you that if you don’t need a lawyer, it’s not worth hiring one.
- Finding a lawyer takes a long time. Getting a lawyer who specializes in what you need, costs what you’re willing to pay, and can work with you well is a tall order.
- Lawyers also take longer to form a business than a formation service. Because lawyers are also very careful people, they will generally take much longer to form your company than non-lawyers would. Fortunately, most people don’t need a lawyer. In 90% of cases, a formation service will do just fine.
Do it Yourself
Another option is to simply start your LLC on your own. To many, this seems like the cheapest route to take. But don’t forget to account for the value of your time. You might find that your time can be better spent working on other aspects of your business.
When deciding if a DIY formation approach is right for you, be sure to think about the benefits:
- Personal knowledge. A DIY business owner will learn a lot about the process while forming their own business, and they probably will retain that knowledge for years to come.
- It costs less upfront. If you don’t account for the value of your time, a DIY solution is the cheapest option.
But, you should also consider the drawbacks:
- You’re losing money when you consider how much time it takes to DIY. If you figure out that your time is worth $30 per hour, and you take 20 hours to complete your business formation, you have essentially spent $600 on business formation.
- There’s the risk of making a mistake. DIY business owners can easily make a mistake with all the paperwork that can cost them even more time and money.
- It’s a headache. State workers are very helpful, capable people. But they will also tell you that the laws and rules governing business formation are not easy, and they follow those rules for a living. It’s going to be even harder for you.
Annual West Virginia LLC Fees: How Much Will it Cost to Maintain your LLC?
West Virginia requires LLCs to file an annual report with the Secretary of State. You can do this online. There is a $25 filing fee.
You also might need to periodically renew the business licenses or permits for your LLC.
Additionally, some optional costs will be ongoing. For instance, you may need to pay the following on an annual basis:
- Registered agent service fee: approximately $100
- Domain name registration: $20 to $60
How Much are LLC Taxes in West Virginia
In West Virginia, LLCs are “pass-through” entities that don’t have to pay income taxes. You must include your LLC’s earnings on your personal income taxes instead.
However, if you opt to have your LLC taxed as a corporation, it will be subject to West Virginia’s Corporate Income Tax.
West Virginia LLC Formation Costs Quick Links
- West Virginia Online Filing
- West Virginia Fee Schedule
- West Virginia New Business Startup Wizard
- West Virginia Secretary of State
- West Virginia State Tax Department
- IRS — apply for an EIN online
- IRS information regarding the federal tax treatment of LLCs
West Virginia LLC Formation Costs FAQs
How much does it cost to start an LLC in West Virginia?
The lowest possible cost is $130. But, it could cost more if you need to get a license or permit.
What is the cheapest way to start an LLC in West Virginia?
A do-it-yourself formation strategy is the cheapest in terms of cash expended. However, if you account for the value of your time, a reasonable LLC formation service is frequently the most cost-effective approach.
Do I need to hire an attorney to form an LLC in West Virginia?
No. You don’t need to hire a lawyer to start a standard LLC. A DIY method or a formation service will often be more than fine.
Can I pay to form an LLC more quickly in West Virginia?
Yes. You can choose 24-hour expedited service for a $25 fee, 2-hour processing for a $250 fee, or 1-hour processing for a $500 fee.