How to set up an LLC for your rental property in Washington

If you own rental properties in Washington state—or you’re planning to buy one—setting up an LLC may be a smart move. Many landlords consider LLCs to help protect their personal assets and organize their rental business. But how exactly do you set up an LLC for a rental property in Washington? What are the costs, requirements, and timelines involved? And how does an LLC stack up against other options like umbrella insurance or an S corp election?

This guide walks you through everything you need to know about forming an LLC for your Washington rental property, with a friendly, straightforward approach tailored to the Evergreen State.

What is an LLC, and what does it protect you from as a landlord?

LLC stands for Limited Liability Company. It’s a popular business structure that blends the flexibility of a sole proprietorship or partnership with limited liability protection, which means your personal assets—like your home or savings—are often protected from lawsuits or debts related to your rental property, but this protection is not guaranteed.

That said, an LLC isn’t a shield against everything. For example, if you personally guarantee a loan or engage in illegal activity, the protection can be pierced. Also, an LLC doesn’t protect you from certain liabilities like tenant injuries if you’re negligent, so it’s important to pair an LLC with strong landlord insurance.

Step-by-step: how to set up an LLC for a rental property in Washington

Here’s a straightforward walkthrough of the process to form your LLC in Washington:

1. Choose a name for your LLC

Your LLC name must be unique and follow Washington's naming rules. It must include “Limited Liability Company” or abbreviations like “LLC” or “L.L.C.” You can check name availability on the Washington Secretary of State’s business name search page.

2. Designate a registered agent

Your LLC needs a registered agent with a physical address in Washington. This person or company receives official documents on behalf of your LLC. You can serve as your own registered agent if you have an address in-state.

3. File articles of organization

Articles of organization are the official documents that create your LLC. You’ll file these with the Washington Secretary of State. The form asks for basic info like LLC name, registered agent, and management structure.

To file articles of organization, you can do it online through the Washington Corporations and Charities Filing System, or mail a paper form. The state charges an LLC filing fee, which we’ll cover in detail below.

4. Create an operating agreement

While not required by Washington law, an operating agreement is highly recommended. It outlines how your LLC will be managed, members’ roles, and how profits/losses are shared. This is especially useful if you have multiple owners.

5. Apply for an EIN

If your LLC will have employees or multiple members, or if you want to open a business bank account, you’ll need an Employer Identification Number (EIN) from the IRS. We’ll explain how to get one below.

6. Register for state taxes (if applicable)

Depending on your rental activities, you might need to register with the Washington Department of Revenue for business taxes.

7. Stay compliant with annual reporting

Washington requires LLCs to file an annual report and pay a fee to keep your LLC in good standing. We’ll discuss this later.

How much does it cost to set up an LLC in Washington?​

Costs can vary, but here’s a breakdown of the common fees:

• LLC filing fee: $200 (as of 2025) to file your articles of organization online or by mail with the Secretary of State.
• Annual report fee: $60 every year to maintain your LLC’s active status, according to LLC University.
• Registered agent fees: If you hire a commercial registered agent, expect to pay $100-$300/year. If you act as your own agent, this cost is zero.
• Operating agreement and legal help: Optional, but if you hire a lawyer to draft or review documents, fees vary widely.

In total, expect to pay at least $260 upfront and annually for the filing and report fees alone. For a detailed look at costs and ongoing expenses, see the Secretary of State’s fee schedule.

How long does it take to set up an LLC in Washington?

Washington’s Secretary of State typically processes online filings within 1–3 business days. Paper filings may take longer—up to 2 weeks.

Filing online is often faster. Once approved, you officially have your LLC and can move forward with your rental property business.

What are articles of organization and how to file them?

Articles of organization are the foundational documents that officially create your LLC. They include information like:

• LLC name and address  
• Registered agent details  
• Whether your LLC will be member-managed or manager-managed  

Filing articles of organization with the Washington Secretary of State is the key step to legally establish your LLC.

You can file online or download a PDF form to mail in. The online system guides you through the process and accepts payments electronically. For more details, visit the official Washington Secretary of State LLC filing page.

Do I need a lawyer to start an LLC in Washington?

Many people start an LLC without a lawyer, but consulting one may be helpful. Many landlords and investors handle the process themselves, especially with the helpful online systems available.

That said, consulting a lawyer or tax professional can be valuable if you have complex ownership structures, want custom operating agreements, or need personalized advice.

For many, the process is manageable without legal help, but it’s always wise to check in with a qualified professional when in doubt.

How to get an EIN for an LLC that owns rental property

An EIN (Employer Identification Number) is a tax ID from the IRS that identifies your LLC for federal tax purposes.

Getting an EIN is free and easy. You can apply online through the IRS website and receive your EIN immediately. You’ll need your LLC’s legal name, formation date, and other basic info.

Even if your LLC has no employees, an EIN is usually needed to open a bank account or file taxes as a business entity.

Learn more about obtaining an EIN at the official IRS EIN application page.

Do LLCs need annual reports in Washington?

Yes. Washington requires LLCs to file an annual report every year by the end of the month your LLC was formed. The report updates your company’s contact info, registered agent, and ownership details.

The annual report fee is $71 (as of 2024), payable online through the Secretary of State portal.

Missing your annual report deadline may lead to your LLC being administratively dissolved, so it’s important to stay on top of this requirement.

S corp vs LLC for landlords in Washington

While an LLC is a business structure, an S corp is a tax status you can elect for your LLC or corporation.

Many landlords start with a simple LLC for ease and flexibility. Electing S corp status can provide potential tax advantages depending on your situation but also adds complexity, like payroll requirements and stricter rules.

For landlords weighing these options, it helps to understand the pros and cons and work with a tax expert.

• LLC: Easier to set up and manage, fewer formalities.  
• S corp: May reduce self-employment taxes but requires payroll and more compliance.

Both can own rental property, but your choice depends on your financial goals and situation.

LLC vs umbrella insurance for rental property risk management

An LLC generally limits your personal liability by separating your business assets from personal ones, but it doesn’t replace insurance.

Umbrella insurance provides extra liability coverage beyond your landlord insurance and can protect you against large claims.

You might be wondering: should I rely on an LLC, umbrella insurance, or both? The truth is, many landlords benefit from using both to cover different risks.

For a detailed comparison, check out our article on LLC vs umbrella insurance.

When does an LLC make sense for landlords in Washington and when might it not?

An LLC can make sense if you want to:

• Protect personal assets from rental property lawsuits  
• Separate your rental business finances  
• Make it easier to transfer ownership or bring in partners  

However, it might not be worth the cost or effort if:

• You have only one property and minimal risk  
• You already have strong personal asset protection and insurance  
• You don’t want to handle annual reports and compliance  

Final thoughts: review your LLC and insurance strategy in Washington

Setting up an LLC for your Washington rental property can be a practical way to organize your business and may help protect your personal assets. The state’s filing process is straightforward, with clear fees and annual requirements you can manage online.

Remember, an LLC is just one part of your landlord risk management. Don’t forget to pair it with solid landlord insurance tailored to Washington’s market.

And if you’re wondering about the nuances between LLC protections and insurance, or tax options like S corp elections, be sure to consult with professionals who understand Washington’s laws.

Good luck with your Washington rental property journey!