How to Start an E-Commerce or Amazon FBA Business in Washington: $100,000 Economic Nexus, B&O and Reseller Permits

If you want to know how to start an ecommerce business in Washington, the order of steps matters more than most guides admit. Form the entity first, get your state business license and UBI, register for the taxes you owe, and only then start selling. Amazon FBA sellers follow the same path. The main differences are how sales tax works on marketplace orders and when your sales begin to create a Washington tax obligation.

Washington has no corporate income tax and no individual income tax today. Instead, the state uses the business and occupation (B&O) tax, a gross receipts tax with no deduction for labor, materials or other costs. Census data counts 1,414 online retail establishments in Washington, so you will be competing with many sellers. This guide covers the steps in the order you should take them.

Disclaimer: This article is informational content, not legal or tax advice. Rates, thresholds and deadlines change. Confirm current requirements with the agency named in each step, and consult a qualified Washington attorney or CPA before you form your business or make tax decisions, especially if you sell across state lines or store inventory outside Washington.

Materials and Information You Need

Gather these before you open any state account. Most applications ask for the same details, and having them ready saves time.

• Two or three business name options, checked against Washington's naming rules
• A physical street address in Washington for your registered agent (PO boxes and private mailbox addresses are not accepted)
• An email address for the registered agent and for state notices
• A federal Employer Identification Number (EIN) from the IRS, which you need for banking and tax accounts
• A business bank account and business credit card, kept separate from personal funds
• A supplier list, a product list and a monthly sales forecast for each channel (your own website, Amazon and any other marketplaces)
• Accounting software or a spreadsheet to track gross receipts by month and by destination state
• Online access to the Corporations and Charities Filing System (CCFS) and the Department of Revenue's Business Licensing Service (BLS)

Step 1: Choose Your Business Structure

Most ecommerce sellers choose between a sole proprietorship and a limited liability company (LLC). A sole proprietorship and a general partnership do not file anything with the Secretary of State. That does not mean you skip state paperwork. If you operate under a name other than your legal name, you still register a trade name and will likely need a state business license.

An LLC adds a formation filing and a yearly annual report, but in most cases it keeps your personal assets separate from business debts and claims. A corporation is also an option, with a $180 filing fee and the same $70 annual report. The right structure depends on your liability exposure, whether you expect outside investors, and how you plan to pay yourself. Talk with a CPA about the tax side before you choose.

Step 2: Check and Reserve Your Business Name

If you form an LLC, the name must include "Limited Liability Company," "Limited Liability Co.," "L.L.C." or "LLC" under RCW 23.95.305. It must also be distinguishable from every other business name on record with the Secretary of State. Names may not contain bank, banking, banker, trust, cooperative, any combination of industrial and loan, or any combination of two or more of building, savings, loan, home, association and society.

Search the Secretary of State business search before you commit. A name search does not check trademarks, so also search the USPTO trademark database before you print packaging or buy inventory under a brand name. If you need time, you can reserve a name for 180 days for a $30 fee.

Step 3: File the Certificate of Formation and Appoint a Registered Agent

File the Certificate of Formation with Initial Report through the Corporations and Charities Filing System (CCFS). The filing fee is $180. Washington uses the term "registered agent" for the person or company that accepts legal papers for your business. Under RCW 23.95.415, your registered agent may be a commercial service or a noncommercial person. The agent must consent to serve, must supply an email address and must have a physical street address in Washington. There is no fee to change the registered agent or registered office later.

Processing is not published as a standard turnaround. Filings are worked in the order received, and expedited and same-day orders go into a separate priority queue. Expedited service costs $100 per business entity and is generally processed within three business days. Order it online at checkout, or mail the filing with the envelope marked EXPEDITE. The fee schedule lists same-day service at $150, but the Corporations Division currently charges the $100 expedited rate for front-counter same-day transactions received before 3:30 p.m. It says it will give 30 days notice on its website before it starts charging $150. Check the current rate on the Secretary of State website before you pay.

Step 4: Get Your EIN and Open Your Accounts

Apply for your federal EIN directly through the IRS. Use it to open your business bank account, to complete supplier and marketplace applications, and for any state filing that asks for a federal identification number. Open the business bank account and credit card as soon as you have the EIN. Keeping business and personal money separate from the first day helps protect your liability shield. Mixing the two is one of the easiest ways for an LLC owner to weaken it.

Step 5: Register a Trade Name if You Sell Under a Brand

If your storefront or Amazon brand name differs from your legal name, register it as a trade name (doing business as). Trade names are filed with the Department of Revenue's Business Licensing Service, not the Secretary of State and not the county. The fee is $5 for each trade name, plus the non-refundable Business License Application processing fee. That fee is $50 to open or reopen a business, or $10 when the filing is for another purpose, such as adding a trade name to an existing business. Register at the Department of Revenue trade name page.

Step 6: Apply for the Business License Application and Your UBI

The Business Licensing Service (BLS) inside the Department of Revenue runs Washington's statewide business license. One application registers your business, issues your 9-digit Unified Business Identifier (UBI) and adds any city or state endorsements. If you are an LLC, corporation, LLP or partnership, you must file with the Secretary of State first, then submit the Business License Application.

Most ecommerce businesses need a license. You need one if you sell anything subject to sales tax, expect $12,000 or more in gross income per year, operate under a name other than your full legal name, plan to hire employees within 90 days, or owe any tax or fee to the Department of Revenue. The processing fee is $50 to open a business, plus separate endorsement fees. Confirm the endorsement fees on the BLS page, because they depend on your city and activities.

Timing depends on how you file. Online applications take about 10 business days. Add 2 to 3 weeks if city or state endorsements need approval. Mailed applications can take up to six weeks.

Step 7: Set Up Sales Tax, Reseller Permits and B&O

Your Business License Application covers the tax accounts you need. Washington's state sales tax rate is 6.5%, and local rates are added on top. Confirm the combined rate for each location with the Department of Revenue before you set up checkout or marketplace tax settings.

Reseller permit. Washington issues reseller permits. With one, you can buy inventory you plan to resell without paying sales tax to the supplier, and you give the supplier your permit number. The rule is strict. Using a reseller permit to buy items for your own use, or for anything other than resale, can trigger a penalty of 50% of the tax due under RCW 82.32.291. Keep records that tie each tax-free purchase to a sale.

B&O tax. The B&O tax is a gross receipts tax, so it applies to your total sales, not your profit. Under RCW 82.04.250, the retailing rate is 0.471% through 2026-12-31 and 0.5% starting 2027-01-01. The wholesaling rate is 0.484% for the same period. Confirm the wholesaling rate that applies after 2026-12-31 with the Department of Revenue. As an example, $10,000 in monthly retail gross receipts produces $47.10 of B&O at 0.471%, before any credit.

Small business credit. Under RCW 82.04.4451, qualifying businesses may take a credit of up to $55 a month for most retailers, or up to $160 a month for service-heavy filers, rising to $125 and $375 a month from January 1, 2029. Eligibility depends on criteria the Department of Revenue sets, so confirm it before you plan around the credit.

Step 8: Understand the $100,000 Economic Nexus Rule

B&O nexus starts when your Washington gross receipts exceed $100,000 in the current or prior year, or when you have any physical presence in the state. Once you cross that line, you must register and report, even if you have no office, employees or inventory here. Many online sellers only learn about nexus after they cross it, so track your Washington revenue monthly from your first sale.

Marketplace sales count toward this test. Under RCW 82.04.067, a marketplace facilitator counts all marketplace sellers' proceeds, so the platform's Washington totals include your sales. Facilitators must collect retail sales tax on marketplace sales under RCW 82.08.0531, a rule in effect since 2018-10-01. That does not remove your own obligations. Sellers may still need a Department of Revenue account and must report B&O on their marketplace sales. Ask the Department of Revenue to confirm how your marketplace sales should be reported.

If you sell through your own website, you handle sales tax collection yourself. The sales tax rules for remote sellers are separate from the B&O nexus test, so confirm with the Department of Revenue when you must collect sales tax on direct orders. For Amazon FBA, ask whether storing inventory at a Washington location could create physical presence for your business.

Step 9: Check City, County and Local B&O Requirements

Washington has 39 counties and 281 incorporated places, which are cities and towns. Your city may require its own business license, and about 54 cities also levy their own B&O tax. The Department of Revenue does not administer local B&O taxes, so you register and file with the city separately. Check your city's and county's websites for the address you will use. Your home office city may differ from the city where your warehouse or fulfillment partner is located.

Step 10: Confirm Whether Your Products Need an Industry License

Most general merchandise needs no industry license, but some categories do. The Liquor and Cannabis Board (LCB) licenses liquor, cannabis and tobacco. The Washington State Department of Agriculture (WSDA) licenses cottage food, food processors and pesticides. The Department of Health (DOH) licenses several health professions and businesses. Confirm requirements with the relevant agency before you list a product.

Shipping restrictions also apply. Alcohol, cannabis and vapor products cannot be shipped. Build that into your product plan, and check your marketplace's restricted-product rules before you buy inventory.

Step 11: Watch the Digital Services Sales Tax Rules

If you sell services alongside products, such as design, custom software, IT support or advertising, read this section carefully. Since 2025-10-01, web development, custom software, IT services and advertising have been subject to sales tax under ESSB 5814. The 2026 law, ESSB 6346, repeals the tax on most of those services starting 2029-01-01, but it does not repeal the tax on advertising. Until then, confirm how the tax applies to your specific service with the Department of Revenue.

Step 12: Set Up Your Amazon FBA Account and Keep Your Own Records

Create your seller account, list your products and ship inventory to Amazon's fulfillment network once your listings are ready. Amazon will ask for your business identity, tax information and bank details, so have your EIN, UBI and bank information on hand. Amazon's role as a marketplace facilitator does not replace your own reporting duties. Download your sales reports each month and reconcile them against your Washington gross receipts.

Common Mistakes to Avoid

• Using a PO box or mailbox service as your registered agent address. Washington requires a physical street address in the state.
• Skipping the annual report. The $70 annual report is due by the last day of the month in which you formed the entity, every year. A late filing carries a delinquency fee, for a total of $95.
• Selling under a brand name without a trade name. If the name differs from your legal name, register it through the BLS.
• Assuming the marketplace handles all of your taxes. Facilitators collect sales tax, but you may still need a Department of Revenue account and B&O reporting.
• Misusing a reseller permit. Buying supplies for personal or business use with a reseller permit can cost you a penalty of 50% of the tax due.
• Ignoring nexus until you have already crossed it. Track Washington gross receipts monthly against the $100,000 threshold.
• Forgetting local B&O. The state license does not cover city B&O taxes that the Department of Revenue does not administer.
• Shipping restricted products. Alcohol, cannabis and vapor products cannot be shipped.

Fees and Key Numbers at a Glance

Item	Cost	Where to file
Certificate of Formation (LLC)	$180	Secretary of State, CCFS
Expedited formation service	$100 per business entity	Secretary of State
Annual report	$70 per year ($95 total if late)	Secretary of State
Name reservation (180 days)	$30	Secretary of State
Trade name registration	$5 per trade name	Department of Revenue, BLS
Business License Application processing	$50 to open, or $10 for other filings, plus endorsements	Department of Revenue, BLS
State sales tax rate	6.5%, plus local rates	Department of Revenue
B&O retailing rate	0.471% through 2026-12-31; 0.5% from 2027-01-01	Department of Revenue

Expected Timeline and Results

The published processing times give you a rough planning window. Actual timing depends on each agency's current workload and on whether you need endorsements.

1. Formation: expedited filings are generally processed within three business days. Regular filings have no published standard turnaround.
2. Business License Application: about 10 business days online, 2 to 3 weeks longer with city or state endorsements, and up to six weeks by mail.
3. EIN, bank account and trade name: these can run alongside your state filings.
4. First taxable sales: plan to start once your business license and tax accounts are active.

With setup complete, your Washington ecommerce business may be ready to sell. Results depend on your product, pricing, competition and marketing, and nothing in this guide promises sales or income. The most reliable outcome of doing the setup correctly is fewer surprises: a clean entity filing, a license that matches your activities, tax accounts you can defend, and a clear record showing when your Washington sales crossed the $100,000 threshold.

Final Tips Before You Launch

• Start a spreadsheet on day one that tracks Washington gross receipts by month and by sales channel.
• Give suppliers your reseller permit number only for goods you will resell.
• Calendar your annual report deadline the day you form your LLC.
• Ask the Department of Revenue to confirm your filing frequency once your account is set up.
• Spend an hour with a CPA before you commit to a large inventory purchase.
• If you want free-of-charge guidance on planning, the Washington Small Business Development Center offers small business advising.