Washington compliance for real estate LLCs

Research steps taken and summary of findings: I ran parallel web searches and targeted scrapes of Washington state official sources to collect authoritative, state-specific compliance requirements for real estate LLCs.

Sources queried and extracted included the Washington Secretary of State (formation, registered agent, annual reports), Washington Department of Revenue (business registration, B&O tax, real estate excise tax), Washington Revised Code (RCW) for landlord-tenant and REET statutes, Washington Department of Licensing (real estate licensing for brokers/firms), and Business.WA (state business licensing guidance).

The research focused on: entity formation and fees; registered agent and annual report obligations; Department of Revenue registration & tax thresholds (B&O, sales tax nexus); real estate excise tax (REET) rules; landlord-tenant statutory duties relevant to rental property owners (security deposits, notices); and whether property management requires real estate licenses.

Key findings (authoritative, state-specific obligations and practical next steps): 1) Forming and maintaining an LLC in Washington (Secretary of State) - File a Certificate of Formation to create a Domestic LLC (online via CCFS).

Filing fee: $180. (See SOS Certificate of Formation / filing resources.) - An Annual Report must be filed every year to maintain active status. The Annual Report is due by the business entity’s expiration date (the last day of the month in which the LLC was formed); it may be filed up to 180 days before the expiration date.

The Annual Report fee for profit business entity types (including LLCs) is $70. Delinquency and reinstatement penalties apply if reports are missed. - Designate and maintain a Registered Agent with a physical street address in Washington State (PO Boxes/PMBs are not permitted).

Practical actions: file the Certificate of Formation ($180); designate a compliant registered agent; calendar the LLC’s annual report due date and budget the $70 fee; enroll in Secretary of State online account (CCFS) for filings. 2) Department of Revenue registration, UBI, and tax thresholds - Most LLCs doing business in WA must register with the Department of Revenue via the Business License Application to get a Unified Business Identifier (UBI) and to report state taxes.

A business must register to report B&O tax and collect/submit applicable sales tax if it meets any of: (a) physical presence nexus in Washington; (b) more than $100,000 in combined gross receipts sourced/attributed to Washington in the current or prior year; or (c) is organized or commercially domiciled in Washington. - The Washington state B&O tax is a gross receipts tax (taxed on gross income with classification-based rates).

Filing frequencies: monthly returns due the 25th of the following month; quarterly returns due by the end of the month following the quarter; annual returns (if applicable) have a filing date (annual due date noted by DOR; returns payment schedules vary; see DOR guidance).

Determine the correct B&O classification for rental-related activities. Practical actions: complete the Business License Application early (get a UBI), register for appropriate excise tax accounts, analyze whether your activities create nexus/meet the $100k threshold, set up accounting to report gross receipts accurately and remit B&O/sales taxes as required. 3) Real Estate Excise Tax (REET) - The excise tax on real estate sales is codified at RCW chapter 82.45.

The statute covers definitions, the tax on sales of real property, exemptions, liability, and the tax being payable at time of sale. The seller is generally responsible for payment; transfers and controlling-interest transfers have reporting requirements. - Rates and certain program details are administered and published by the Department of Revenue.

Because statutory citations and DOR guidance are authoritative, always check DOR’s REET page for current rates, local filing practices, and instructions for affidavits/controlling-interest reporting. Practical actions: for any sale of WA real property, plan for REET compliance (seller’s obligation unless contract specifies otherwise), use the DOR REET guidance and RCW 82.45 when preparing closing documents, and confirm current state rates and any local requirements with DOR before closing. 4) Landlord–tenant statutory obligations (owners of rental property) - Washington’s Residential Landlord–Tenant Act is codified at RCW chapter 59.18.

The statute contains rules on deposits/fees, holding fees, returning deposits, rules regarding termination, landlord notice obligations, allowable deductions, and civil remedies for violations. The RCW requires prompt return of fees/deposits when a holding fee or deposit is not retained and sets out remedies for violations.

Practical actions: review RCW 59.18 in full for security deposit procedures and retention/return timelines; ensure lease forms and move-in/move-out procedures comply (inspection checklists, written disclosures, accurate accounting of deductions, deposit mailing/return process).

Research steps taken and summary of findings: I ran parallel web searches and targeted scrapes of Washington state official sources to collect authoritative, state-specific compliance requirements for real estate LLCs.

Sources queried and extracted included the Washington Secretary of State (formation, registered agent, annual reports), Washington Department of Revenue (business registration, B&O tax, real estate excise tax), Washington Revised Code (RCW) for landlord-tenant and REET statutes, Washington Department of Licensing (real estate licensing for brokers/firms), and Business.WA (state business licensing guidance).

The research focused on: entity formation and fees; registered agent and annual report obligations; Department of Revenue registration & tax thresholds (B&O, sales tax nexus); real estate excise tax (REET) rules; landlord-tenant statutory duties relevant to rental property owners (security deposits, notices); and whether property management requires real estate licenses.

Key findings (authoritative, state-specific obligations and practical next steps): 1) Forming and maintaining an LLC in Washington (Secretary of State) - File a Certificate of Formation to create a Domestic LLC (online via CCFS).

Filing fee: $180. (See SOS Certificate of Formation / filing resources.) - An Annual Report must be filed every year to maintain active status. The Annual Report is due by the business entity’s expiration date (the last day of the month in which the LLC was formed); it may be filed up to 180 days before the expiration date.

The Annual Report fee for profit business entity types (including LLCs) is $70. Delinquency and reinstatement penalties apply if reports are missed. - Designate and maintain a Registered Agent with a physical street address in Washington State (PO Boxes/PMBs are not permitted).

Practical actions: file the Certificate of Formation ($180); designate a compliant registered agent; calendar the LLC’s annual report due date and budget the $70 fee; enroll in Secretary of State online account (CCFS) for filings. 2) Department of Revenue registration, UBI, and tax thresholds - Most LLCs doing business in WA must register with the Department of Revenue via the Business License Application to get a Unified Business Identifier (UBI) and to report state taxes.

A business must register to report B&O tax and collect/submit applicable sales tax if it meets any of: (a) physical presence nexus in Washington; (b) more than $100,000 in combined gross receipts sourced/attributed to Washington in the current or prior year; or (c) is organized or commercially domiciled in Washington. - The Washington state B&O tax is a gross receipts tax (taxed on gross income with classification-based rates).

Filing frequencies: monthly returns due the 25th of the following month; quarterly returns due by the end of the month following the quarter; annual returns (if applicable) have a filing date (annual due date noted by DOR; returns payment schedules vary; see DOR guidance).

Determine the correct B&O classification for rental-related activities. Practical actions: complete the Business License Application early (get a UBI), register for appropriate excise tax accounts, analyze whether your activities create nexus/meet the $100k threshold, set up accounting to report gross receipts accurately and remit B&O/sales taxes as required. 3) Real Estate Excise Tax (REET)

82.45. The statute covers definitions, the tax on sales of real property, exemptions, liability, and the tax being payable at time of sale.

The seller is generally responsible for payment; transfers and controlling-interest transfers have reporting requirements.

82.45 when preparing closing documents, and confirm current state rates and any local requirements with DOR before closing. 4) Landlord–tenant statutory obligations (owners of rental property)

59.18. The statute contains rules on deposits/fees, holding fees, returning deposits, rules regarding termination, landlord notice obligations, allowable deductions, and civil remedies for violations.

The RCW requires prompt return of fees/deposits when a holding fee or deposit is not retained and sets out remedies for violations. Practical actions: review RCW 59.18 in full for security deposit procedures and retention/return timelines; ensure lease forms and move-in/move-out procedures comply (inspection checklists, written disclosures, accurate accounting of deductions, deposit mailing/return process).

• The excise tax on real estate sales is codified at RCW chapter
• Rates and certain program details are administered and published by the Department of Revenue. Because statutory citations and DOR guidance are authoritative, always check DOR’s REET page for current rates, local filing practices, and instructions for affidavits/controlling-interest reporting. Practical actions: for any sale of WA real property, plan for REET compliance (seller’s obligation unless contract specifies otherwise), use the DOR REET guidance and RCW
• Washington’s Residential Landlord–Tenant Act is codified at RCW chapter

Real estate broker/firm licensing (property management and brokerage) - The Washington Department of Licensing administers licensing for real estate professionals

brokers, managing brokers, designated brokers, and real estate firms. Brokers perform brokerage services for real estate firms and are supervised by managing brokers; firms must be licensed. Property management activities performed for others generally constitute brokerage services and normally require the appropriate broker and firm licensing and supervision by a managing broker. Practical actions: if an LLC will be managing property on behalf of third parties (rent collection, leasing, showing properties, negotiating leases/sales), consult DOL licensing pages and consider obtaining/engaging licensed brokers or registering a real estate firm and designated/managing broker oversight; for property owned and leased by the LLC to its own members/affiliates, brokerage licensing may not be required—confirm with DOL or counsel.

Local (city/county) business licenses and taxes - Many Washington cities and counties require business licenses, local endorsements, or local taxes/fees for business activity (including rental businesses). The Business Licensing Service (business.wa.gov) provides the Business License Application and links to city endorsement lists and local requirements. Practical actions

check the Business Licensing Service (Business.WA) when applying; verify city/county license and permit needs (rental registration, short-term rental permits, local occupancy/tourist taxes) where properties are located.

Foreign (out-of-state) LLCs doing business in Washington - Foreign LLCs must file a Foreign Registration Statement with the Secretary of State (filing fee noted on SOS) to transact business in Washington; they are also subject to the same DOR registration and local licensing requirements if they meet nexus or activity thresholds.

Compliance checklist & recommended next steps (high priority items) - Form/register the LLC (Certificate of Formation; $180 fee) and designate a WA-physical registered agent. - Register with Department of Revenue (Business License Application) to obtain UBI and tax accounts if you meet nexus thresholds (physical presence, >$100k gross receipts, or domiciled in WA). - Confirm B&O classification for rental and property-related revenues; set up bookkeeping to report gross receipts and remit taxes on schedule. - For property sales, prepare for REET (RCW 82.45) — seller obligations and filing; confirm current REET rates with DOR prior to closing. - If engaging in property management/brokerage for third parties, obtain appropriate DOL real estate firm/broker licensure and designated/managing broker supervision. - File and budget for the Secretary of State Annual Report each year (due last day of the formation month; $70 fee for profit LLCs). Maintain registered agent and update filings promptly. - Check city/county-specific licensing, short-term rental rules, and local taxes where each property is located. - Maintain proper records, insurance, and consult a Washington real estate attorney and CPA to align entity, tax, and regulatory compliance for your real estate activities. Limitations and suggestions for follow-up research

- I pulled statutes and agency guidance from SOS, DOR, RCW, DOL, and Business.WA — these are the authoritative sources. I purposely avoided non-official commentaries except for procedural context. - I did not extract DOR’s current REET rate table in this pass; REET rates can change or be tiered and are published/maintained by DOR — confirm rates on DOR’s REET page before any closing. - For landlord-tenant timing specifics (e.g., exact days allowed for returning security deposits) consult RCW 59.18 (I captured statutory language about prompt returns and remedies; check the specific subsection(s) for exact deadlines and procedural requirements).