Washington compliance documentation for advisors

Research steps and summary: I ran multiple targeted searches and page extractions across Washington state official sources and federal guidance to compile an authoritative, state-specific compliance checklist and documentation list advisors should prepare when working with Washington-based business owners and LLC founders.

The research used the Washington Department of Financial Institutions (DFI) for adviser registration rules; Washington Secretary of State (SOS) for entity formation and annual filing requirements; Washington Department of Revenue (DOR) / Business Licensing Service for UBI, business license and B&O/sales tax registration triggers; Washington Department of Labor & Industries (L&I) and Employment Security Department (ESD) for employer obligations (workers' compensation, unemployment insurance, wage/hour rules); Washington Paid Family & Medical Leave (PFML) guidance; Washington state data breach and privacy statutory text (RCW 19.255) and the Attorney General’s resources; and the Financial Crimes Enforcement Network (FinCEN) for Beneficial Ownership Information (BOI) reporting updates.

Key findings (concise): 1. Investment Adviser registration (DFI): Advisers located in Washington must register with WA before commencing business unless SEC registration applies.

State-registered advisers file via the IARD and must submit certain proof (qualifying exams or designations for sole proprietors). Out-of-state advisers may advise up to five WA clients in 12 months without registering; more than that triggers state registration obligations.

Advisors should confirm registration status, IARD filings, and Washington-specific filing steps.

Key findings (concise): 1. Investment Adviser registration (DFI): Advisers located in Washington must register with WA before commencing business unless SEC registration applies.

Advisors should confirm registration status, IARD filings, and Washington-specific filing steps.

Entity formation and Secretary of State filings (SOS)

Washington requires proper formation/registration filings (Certificate of Formation for LLCs, foreign registration for out-of-state entities) and ongoing filings such as Initial Reports and Annual Reports. The SOS site provides online filing instructions, required forms and fees, and notes that some filings (e.g., withdrawals) may require a Department of Revenue clearance certificate.

Business licensing, UBI and state tax registration (DOR / Business Licensing Service)

Many businesses must register with DOR and obtain a business license and Unified Business Identifier (UBI) if they meet any of the triggers (hiring employees, sales tax collection, doing business under a trade name, gross income thresholds — $12,000/year). Advisors must ensure clients obtain the UBI, complete the Business Licensing Wizard, and register for applicable taxes (B&O, sales/use).

B&O tax, sales/use and other state taxes (DOR)

Washington does not have a corporate or personal income tax but does have a Business & Occupation (B&O) tax on gross receipts and sales/use tax for retail sales. Advisors should document tax registration, expected filing frequency, and industry-specific B&O classifications.

Employer obligations (L&I, ESD)

Employers in Washington must comply with L&I (workers’ compensation, workplace safety/WISHA, wage/hour rules, paid sick leave and other state employment laws) and with ESD (unemployment insurance, employer tax accounts). L&I requires covered employers to have workers’ compensation insurance and verify subcontractors’ coverage; many workplace laws (minimum wage, overtime, recordkeeping) are enforced by L&I.

Paid Family & Medical Leave (PFML) (ESD/paidleave.wa.gov)

Washington PFML is administered through the ESD; it provides partial wage replacement and is funded by premiums withheld and employer contributions per statutory rules. Advisors should confirm payroll withholding setup and reporting cadence.

Privacy, data breach notification and security (RCW 19.255; Attorney General)

Washington’s Personal Information—Notice of Security Breaches statute (RCW 19.255) requires notification obligations and sets obligations and liabilities for processors, businesses and vendors. The Attorney General’s office provides data breach guidance and resources. 8. Beneficial Ownership / FinCEN (BOI/CTA): As of the March 26, 2025 interim final rule, FinCEN revised BOI reporting requirements so that entities created in the United States (domestic companies) were exempted from reporting BOI; foreign entities registered to do business in the U.S. remain subject to reporting under deadlines. Advisors must track BOI rule changes and confirm whether their client company (domestic or foreign) has BOI filing obligations. Documentation checklist advisors should assemble for Washington clients (practical, prioritized): - Formation documents: Certificate of Formation (or foreign registration) and copies of filed Articles/Registration and initial filing receipt. - Secretary of State filings calendar: initial report, anniversary for Annual Report, registered agent details, any amendments and fee receipts. - UBI / Business License: DOR-assigned UBI number and Business License record; Business Licensing Wizard results and endorsements list. - Tax registrations: DOR B&O registration details, sales/use tax account (if applicable), quarterly filing schedule and estimated liabilities. - Employment accounts and evidence: L&I account (workers’ comp), ESD employer account (unemployment insurance), Paid Leave employer registration and payroll setup for withholdings; proof of insurance certificates for subcontractors where applicable. - Operating Agreement and governance documents (recommended though not required): membership/manager details, capital contributions, voting rules, banking resolutions. - Compliance policies: wage/hour policies, paid sick leave, harassment prevention policy if applicable, data security and breach response plan (including contact list and statutory timelines under RCW 19.255). - Licensing & permits: industry- and locality-specific licenses (city/county endorsements surfaced by the Business Licensing Wizard) and professional licenses (if applicable). - Securities compliance: For advisors offering investment-advice services, IARD filings, Series exam documentation (Series 65/66/7 or acceptable designations), proof of any state registrations or exemptions. - BOI / Beneficial ownership: if the client entity is foreign and now a “reporting company” per FinCEN rule, confirm BOI filings and deadlines; domestic companies currently exempt per FinCEN March 26, 2025 interim final rule — track updates. - Records and retention: payroll records, meeting minutes, ownership records, contracts, tax returns and proof of filings (retain per federal/state guidance). Recommended advisor workflow (practical):

Intake checklist

gather entity name, SOS registration status and filing receipts, UBI, tax accounts, L&I and ESD account numbers, operating agreement, and current registered agent.

Immediate filings

if SOS registration or DOR/ESD/L&I registrations are missing, prioritize SOS formation (if needed), DOR business license/UBI and ESD/L&I registrations before hiring or transacting taxable sales.

Payroll and withholdings

set up payroll to collect PFML premiums, withhold employee PFML contributions, remit employer-side contributions, and report unemployment tax and workers’ compensation premiums.

Licensing and permits

run the Business Licensing Wizard, secure local endorsements, and apply for any industry-specific permits.

Compliance documentation

assemble the Operating Agreement, employee handbook, data breach plan (RCW 19.255 timelines), and insurance certificates (workers’ comp, general liability as recommended).

Annual calendar

establish reminders for SOS Annual Report, DOR tax filings, ESD/L&I renewals, and any local license renewals.

Securities

for advisors providing investment advice, confirm DFI registration and IARD filings; ensure representatives hold required exams or designations and that filings are completed prior to taking on more than five WA clients if out-of-state. Conclusion: The combined federal and Washington-state regulatory landscape requires advisors working with WA business owners and LLC founders to coordinate entity filings (SOS), tax and licensing registration (DOR/UBI/BLS), employer accounts (L&I, ESD, Paid Leave), and industry-specific compliance (investment adviser registration via DFI). Advisors should produce a one-page client intake checklist, a 12-month compliance calendar, and curated document repository (formation, UBI, tax accounts, insurance, payroll and policies) for each client. Continue monitoring FinCEN BOI guidance and Washington legislative updates (RCW and administrative rules) for changes that impact filing obligations.