West Virginia LLC structure and cost: a falling state income tax, but a municipal gross-receipts tax some cities charge on rent

West Virginia keeps cutting its income tax. The top rate fell from 4.82% to 4.58% for 2026, part of a series of annual reductions that has brought it down from 6.5% before 2023, and there is no franchise tax and no LLC-level state entity tax. Property taxes are low. On the state numbers, West Virginia is inexpensive and getting cheaper. The wrinkle that catches a rental owner is not a state tax at all; it is local. Many West Virginia municipalities levy a business and occupation tax, a gross-receipts tax that can apply to rental income, so where in the state a property sits can change what it costs to operate. Take the state picture first, then the local one.

The falling state income tax

Start with the rate, which drops most years.

West Virginia’s top income tax rate is 4.58% for 2026, down from 4.82%, and it has been falling annually.

A standard West Virginia LLC is a pass-through, so its income lands on the members’ returns across five brackets topping at 4.58% for 2026, cut from 4.82% the prior year and down from 6.5% before the 2023 reform. West Virginia’s cuts are tied to revenue triggers, so the rate has been coming down in steps and is likely to continue, which moves the state toward its low-tax neighbors. There is no franchise tax and no separate LLC-level state tax, and property taxes are among the lowest in the eastern United States, around half a percent. On the state ledger, West Virginia is a low-cost place to hold property. The complication is one level down.

The municipal gross-receipts tax

Here is the West Virginia-specific cost the state figures miss.

Many West Virginia cities levy a business and occupation tax on gross receipts, which can reach rental income.

West Virginia municipalities are authorized to impose a business and occupation tax, an old-style gross-receipts tax on the privilege of doing business in the city, and in cities that impose it, that tax can apply to the gross receipts of a rental operation. The rate and reach vary by municipality and by activity, so a rental in one city may owe a municipal gross-receipts tax that an identical rental in an unincorporated area or a city without the tax does not. This matters for an investor because it is a cost the state income-tax rate does not capture: two West Virginia properties with identical economics can carry different total tax burdens depending on the municipality, and the difference is the local business and occupation tax. So the practical step in West Virginia is to check the specific city’s business and occupation tax before assuming the low state rate is the whole story, and to factor it into the projected return for any property inside a municipality that levies it. On structure, West Virginia offers no series.

West Virginia has no series LLC, so an investor holding several properties forms a separate LLC for each.

West Virginia’s 1996 act has no series provisions, so the single-entity-with-cells structure available in Iowa or Kansas does not exist here, and each property an investor wants insulated goes in its own LLC, covered on the series LLC guide. Because the ongoing state cost is low, no franchise tax and a $25 annual report, running several separate West Virginia LLCs is inexpensive at the state level, though each one is separately exposed to any municipal business and occupation tax where its property sits. A transfer of property into an LLC carries the state excise tax of about 0.22%, plus any county addition, confirmed at the county.

The bottom line

West Virginia’s top income tax rate is 4.58% for 2026, down from 4.82% and falling annually from a pre-2023 top of 6.5%.

There is no franchise tax and no LLC-level state tax, and property taxes are among the lowest in the eastern United States.

Many West Virginia cities levy a business and occupation tax on gross receipts that can reach rental income, so the municipality matters.

Two identical West Virginia properties can carry different total tax burdens depending on the city’s business and occupation tax, a cost the state rate does not capture.

West Virginia has no series LLC, so multiple properties mean multiple separate LLCs, each exposed to any local gross-receipts tax where it sits.

What this page does not cover

This page is about where the entity lives and what it costs to hold and move. How creditors reach a member’s interest, the low homestead, and the missing entireties shield are on the protection page. The 1996 act’s at-will and term company distinction and its duty rules are on the governance page. The $100 formation fee, the veteran fee waiver, and the July 1 annual report are on the filing page.

Last verified August 2026.