Form an LLC in DC: Total Cost & Filing Steps (2026)

DC LLC Cost: $99 Filing + $300 Biennial Report (2026)

Forming an LLC in the District of Columbia costs $99 to file Articles of Organization (Form DLC-1) with the Department of Licensing and Consumer Protection (DLCP), then $300 every two years for the biennial report. On top of that, DC imposes a franchise tax with a $250 minimum on LLCs with gross receipts of $12,000 or more (rising to $1,000 minimum at $1M+ in receipts), payable annually to the Office of Tax and Revenue. Year-one cost: $99 (the biennial report and the first franchise tax fall in year two). Five-year cost of ownership: $1,849 ($99 + $300 × 2 biennial reports + $250 × 5 franchise tax). DC is the only US jurisdiction that treats LLCs as taxable entities at the entity level even when federally classified as pass-throughs, a structural quirk that distinguishes the District from every state.

Reviewed by LLC Formation Cost Editorial Team, fact-checked against primary government sources • Last updated 2026-05-14 • 5 primary government sources cited

TL;DR

DC LLCs file Articles of Organization (Form DLC-1) with the DC Department of Licensing and Consumer Protection for $99. The biennial report is $300, due by April 1 of the year after formation and every two years thereafter. The DC franchise tax (officially the Unincorporated Business Franchise Tax for pass-through LLCs, codified at D.C. Code § 47-1808.01) applies a $250 minimum to LLCs with gross receipts over $12,000, and a $1,000 minimum at $1M+ in gross receipts. DC is the only US jurisdiction that taxes pass-through LLCs at the entity level rather than just at the member level, the federal IRS classification (partnership, disregarded entity, S-corp) doesn't matter for DC purposes. Online filings via CorpOnline are processed in 5 business days standard, 1 day with $100 expedite.

DC LLC cost breakdown (2026)

Line item	Cost	Source
Articles of Organization (Form DLC-1)	$99	dlcp.dc.gov
Biennial Report	$300 every 2 yrs	dlcp.dc.gov
Expedite (24-hour)	+$100	dlcp.dc.gov
DC Franchise Tax (gross receipts $12K-$1M)	$250/yr min	otr.cfo.dc.gov
DC Franchise Tax (gross receipts $1M+)	$1,000/yr min	otr.cfo.dc.gov
Clean Hands Certificate (required for license)	$0	dlcp.dc.gov
Basic Business License (most activities)	$99-$324/2 yrs	dlcp.dc.gov
Registered Agent service (DC-resident required)	$50-$200/yr	n/a
Year 1 total (DIY, no add-ons)	$99
Year 2 (biennial report + franchise tax)	$550
Year 3 (franchise tax only)	$250
5-year total (DIY, $12K-$1M gross receipts)	$1,849	($99 + $300×2 + $250×5)

All figures verified 2026-05-14 from primary DC government sources.

Why DC is structurally different from every state

The District of Columbia is technically a federal district, not a state, and its tax structure reflects that. Two things make DC stand apart:

• Entity-level franchise tax on pass-through LLCs. D.C. Code § 47-1808.01 imposes the Unincorporated Business Franchise Tax on LLCs with DC-source gross receipts, regardless of federal pass-through classification. In every state in the US, a single-member or partnership-taxed LLC owes $0 entity-level income tax (the income flows to the members). In DC, that LLC owes 8.25% of DC-source net income with a $250 floor at $12,000+ gross receipts and $1,000 floor at $1M+ gross receipts.
• Biennial report cadence at $300. DC's $300 biennial works out to $150/yr effective, but the biennial cadence catches founders who budget for annual reports and forget to plan for the off-year zero followed by the on-year $300.

The legal basis for the LLC formation is D.C. Code Title 29, Chapter 8 (Uniform Limited Liability Company Act of 2010). The franchise tax basis is D.C. Code Title 47, Chapter 18.

Filing steps (DIY, no service)

1. Pick a name and check availability, search at CorpOnline. Names must include "Limited Liability Company," "LLC," or "L.L.C." and cannot imply federal or DC government authority.
2. Designate a registered agent, must have a DC street address. P.O. boxes don't qualify. You can act as your own agent if you live in DC.
3. File Articles of Organization (Form DLC-1), $99 via CorpOnline or by mail to DLCP Corporations Division, 1100 4th Street SW, 2nd Floor, Washington, DC 20024.
4. Get a federal EIN, free at irs.gov.
5. Register with the DC Office of Tax and Revenue (OTR), online via MyTax.DC.gov for franchise tax, sales and use tax (6%), withholding tax if hiring.
6. Obtain a Clean Hands Certificate, required before applying for a Basic Business License. Free via MyTax.DC.gov.
7. Apply for a Basic Business License (BBL), $99-$324 for two years depending on activity category. Required for nearly all commercial activity in DC. Via dlcp.dc.gov.
8. Draft an operating agreement, D.C. Code § 29-801.07 recognizes operating agreements but does not require them. Standard practice for any LLC.
9. File the FinCEN BOI report, required under the Corporate Transparency Act within 30 days of formation. Free to self-file at fincen.gov/boi.
10. Calendar the biennial report and franchise tax, biennial report due April 1 of the year after formation (then every two years), $300. DC franchise tax return Form D-30 due April 15 each year.

Online filings via CorpOnline are processed in 5 business days standard; 1-day expedite is $100 (in-person Tier 1 expedite at the DLCP office is $50 same-day for documents under five pages).

Page-unique facts

• DC is the only US jurisdiction that taxes pass-through LLCs at the entity level. Federal partnership classification doesn't help in DC. The Unincorporated Business Franchise Tax (D.C. Code § 47-1808.01) is unique.
• The franchise tax exemption applies only to entities where 80%+ of gross income is from "personal services" performed by individuals. Single-member LLCs of consultants, freelance designers, and similar service businesses can qualify and avoid the franchise tax. Pure investment LLCs and rental real estate LLCs typically do not qualify.
• Biennial report is $300, payable every two years on April 1. First biennial is due April 1 of the year following formation.
• DC requires a Basic Business License for most activities. Separate from the Articles of Organization, separate from the franchise tax. Many founders miss this.
• Clean Hands Certificate is required before getting the BBL. This verifies the entity has no unpaid DC taxes, fines, or fees. Federal employees and others with unresolved DC tax matters can be surprised here.

FAQ

Why does DC tax my pass-through LLC?

Because of the Unincorporated Business Franchise Tax under D.C. Code § 47-1808.01, which is unique among US jurisdictions. DC taxes the LLC at the entity level on DC-source net income at 8.25%, with a $250 minimum if gross receipts exceed $12,000 and a $1,000 minimum if gross receipts exceed $1 million. The federal IRS classification of the LLC (partnership, disregarded entity) does not matter for DC purposes. There is a personal-services exemption: if 80%+ of gross income comes from personal services performed by individuals (think consulting, design, legal services), the LLC may be exempt. Source: DC Office of Tax and Revenue Unincorporated Business Franchise Tax, verified 2026-05-14.

When is the DC biennial report due?

April 1 of the year following formation, then every two years on April 1. For an LLC formed October 2026, the first biennial report is due April 1, 2027 ($300). The next is due April 1, 2029. Late filings trigger a $100 penalty plus a fee for reinstatement if the LLC falls into "revoked" status. Source: DC DLCP Corporations Division, verified 2026-05-14.

Can I skip the DC franchise tax if my LLC is just a holding entity?

Possibly, but check the personal-services rule. A pure holding LLC with no DC-source gross receipts may owe $0 in DC franchise tax. Add DC-source rental income or DC-source service revenue and the $250 minimum kicks in. The personal-services exemption requires 80%+ of gross income to come from individual labor, which is hard for asset-holding entities to meet. Source: DC OTR Form D-30 instructions, verified 2026-05-14.

How long does DC LLC formation take?

CorpOnline standard processing: 5 business days. Expedite (24-hour): $100. Tier 1 in-person expedite (3-hour, for filings under five pages, at the DLCP service center): $50. Mail filings: 4 weeks. Source: DC DLCP.

Do I need a Basic Business License for my DC LLC?

Usually yes. Most commercial activity in DC requires a BBL ($99-$324 for two years depending on the activity category) separate from the Articles of Organization. The Clean Hands Certificate from MyTax.DC.gov is a prerequisite. Holding-only LLCs that conduct no operational business in DC may not need a BBL, but the rule is fact-dependent. Source: DC DLCP Business Licensing.

Is DC a good state for a non-resident formation?

Only if you have DC operations. The combination of $99 filing + $300 biennial + $250/yr franchise tax + DC RA service ($120/yr) + Basic Business License ($99-$324/2 yrs) makes DC one of the most expensive jurisdictions to maintain. A non-resident with no DC nexus would be better served by Wyoming ($340 over 5 years) or New Mexico ($50). DC LLCs make sense for entities operating in the District. Source: DC DLCP.

State quirk: the Unincorporated Business Franchise Tax

DC is the only US jurisdiction that treats pass-through LLCs as taxable entities for income tax purposes. The Unincorporated Business Franchise Tax (UBFT), codified at D.C. Code § 47-1808.01, was created in the 1940s and has survived every wave of federal pass-through reform that wiped out similar taxes at the state level. The rate is 8.25% of DC-source net income, with the floor of $250 for entities with gross receipts of $12,000 to $1 million, and $1,000 for entities with gross receipts above $1 million. The narrow escape valve is the "personal services" exemption: if 80% or more of an LLC's gross income comes from personal services rendered by individual owners, the LLC is exempt and the income flows through to the members' DC personal returns instead. The exemption works well for solo consultants, single-member design firms, and other "I am the business" structures. It fails for holding LLCs, rental real estate, and investment vehicles. DC's status as a federal district (not a state) is what kept the UBFT in place: when most states moved to true pass-through treatment in the 1980s and 1990s to align with the federal Check-the-Box rules, DC was politically insulated from the tax-harmonization pressure and never followed.

Common mistake in DC

The most common DC LLC mistake is forming a single-member LLC, assuming federal pass-through classification means no DC income tax, and then receiving a Form D-30 franchise tax notice the following spring with a $250 bill. The personal-services exemption is narrow and requires actual analysis of where the LLC's gross income comes from; founders who do "business" beyond their own labor (selling products, holding rental real estate, investing) almost always owe the UBFT. The second most common mistake is forgetting the Basic Business License, which is separate from the formation filing and required for almost all commercial activity.

Sources

1. DC Department of Licensing and Consumer Protection Corporations Division, last verified 2026-05-14
2. DC Office of Tax and Revenue Unincorporated Business Franchise Tax (Form D-30), last verified 2026-05-14
3. DC CorpOnline Business Filings Portal, last verified 2026-05-14
4. MyTax.DC.gov, last verified 2026-05-14
5. D.C. Code Title 29 Chapter 8 (Uniform LLC Act of 2010), last verified 2026-05-14
6. IRS Publication 3402, Taxation of Limited Liability Companies, last verified 2026-05-14

About the author

Aissam Baidi is the founder and researcher behind llcformationcost.com. He verifies DC LLC fees directly from dlcp.dc.gov and otr.cfo.dc.gov on a quarterly cycle. Connect on LinkedIn.

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Not legal advice. Estimates based on publicly available data from each state's Secretary of State office. Consult a licensed attorney in your jurisdiction.

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This is a syndicated post. Original article + interactive calculator: https://llcformationcost.com/district-of-columbia-llc-cost/