Starting a service business in Washington comes down to four things: picking a structure, registering with the state, getting licensed for your trade, and setting up a way to bill customers. Filing an LLC in WA costs $200, ongoing reporting is $60/yr, sales tax is 6.5% + local, and personal income tax runs No income tax (7% capital gains). Below is the full sequence, the fees you should budget for, the licenses most trades need, and the deadlines that catch new Washington owners off guard.
Most new registrations come out of Seattle, Spokane, Tacoma — local business licenses are issued at the city or county level, so check yours after the state filing clears.
| Item | WA cost |
|---|---|
| LLC / entity filing (one-time) | $200 |
| Annual / periodic report | $60/yr |
| Federal EIN (IRS) | Free |
| Sales tax registration | Typically free |
| Trade / professional license | Varies by trade |
| Local business license | Set by city / county |
Fees change — confirm current amounts with the WA Secretary of State and the Washington Department of Revenue.
Choose your structure and file with the WA Secretary of State ($200). Get your free EIN from the IRS the same day.
Register for Washington sales tax with the Washington Department of Revenue, then open a business bank account under the registered name.
Apply for your trade license and local business license. This is usually the longest step: WA UBI number; Sales tax permit.
Get general liability insurance (and workers' comp before your first hire), then set up estimates and invoicing so you can bill the day you're cleared to work.
LLC Filing Fee
$200
Annual Report
$60/yr
Sales Tax
6.5% + local
Income Tax
No income tax (7% capital gains)
Choose business structure
File with WA Secretary of State
Get EIN
Register with WA DOR for B&O tax
Get local licenses
Open business bank account
No income tax but B&O (Business & Occupation) tax applies to gross receipts
Seattle has additional city taxes
Capital gains over $270K are taxed at 7%
No income tax, but B&O tax applies to gross receipts (0.47%–1.5% depending on classification).
Online LLC filings with the WA Secretary of State are typically processed in a few business days, and an EIN from the IRS is issued immediately online. Trade licensing and local permits usually take longest — plan on two to six weeks before you're fully cleared to work, depending on your trade.
No — you can operate as a sole proprietor in Washington and still invoice customers legally. An LLC ($200 to file, $60/yr) separates your personal assets from business liability, which matters most once you're on customer property, hiring help, or signing contracts.
Washington sales tax is 6.5% + local. Materials and goods are commonly taxable, while labor treatment depends on the type of work, so bill parts and labor as separate lines and register with the Washington Department of Revenue before you start collecting.
Open a business bank account under the registered name, then invoice from a tool that applies WA tax per line item and accepts cards. Glo Invoice sends invoices by text with a one-tap pay link, and Tap to Pay lets you charge on site before you leave the job.