Washington, DC lesson 4 of 6
Basic Business Licence and Clean Hands
In most states, forming the entity and getting an EIN is enough to start trading. In DC there are two extra steps, and one depends on the other.
The Certificate of Clean Hands
Clean Hands means you are not in arrears to the DC government. For the Basic Business Licence specifically, DLCP states that every applicant must certify that no more than $1,000 is owed to the District in fees, penalties, interest or taxes, and that the tax number used on the application must be registered with the Office of Tax and Revenue and pass a Clean Hands verification.
The Certificate of Clean Hands itself is requested free through the MyTax DC portal and is valid for a limited period, so obtain it close to when you need it.
The $1,000 figure is the DLCP licensing threshold. Other DC processes that require Clean Hands, such as certain contracts, grants and permits under D.C. Code section 47-2862, can apply a different arrears threshold, so do not carry the licensing figure across to them.
The Basic Business Licence
Most businesses operating in DC need a Basic Business Licence from DLCP, issued under a category that matches your activity, for example general business, retail, or a specific regulated category. Fees depend on the category and the licence term, with two year terms common. Home based businesses in DC also generally need a home occupation permit from the zoning administrator.
- Clean Hands first, then the licence application
- The licence category must match what you actually do
- Home based businesses usually need a home occupation permit as well
Order of operations
Form the LLC, obtain the EIN, register with the Office of Tax and Revenue on MyTax DC, obtain Clean Hands, then apply for the Basic Business Licence. Trying to do these out of order is the usual cause of delay.
Key takeaways
- Clean Hands is a prerequisite for most DC licences.
- Most DC businesses need a Basic Business Licence in the right category.
- Follow the sequence: entity, EIN, tax registration, Clean Hands, licence.
Official sources
Or let us file your Washington, DC LLC for you
Everything above is yours to use for free. If you would rather hand it over, we prepare and file the Articles of Organization for a Domestic Limited Liability Company (Form DLC-1), act as your registered agent, and track your ongoing deadlines.
Last reviewed: September 2026 - reviewed by Gullia Filing Legal & Formation Team