Can You Incorporate in Multiple States
No, although your corporation or limited liability company can register and do business in multiple states, you are only allowed to incorporate in one state.3 min read
Updated November 4, 2020:
Can you incorporate in multiple states? No; although your corporation or limited liability company can register and do business in multiple states, you are only allowed to incorporate in one state.
LLCs in Multiple States
Limited liability companies are governed by state law. An LLC is a popular business structure because these companies offer liability protection and pass-through taxation of a corporation and the flexible operations of a partnership.
If you want your LLC to do business in multiple states, you first need to choose a home state in which to incorporate. In your home state, you will register your company as a domestic LLC. Once you have formed your domestic LLC, you can do business in other states by completing a foreign LLC registration.
Registering Your LLC
Selecting your home state is the first step you should take when forming an LLC. Small business LLCs will usually incorporate in the same state where the business will operate.
If you only plan for your LLC to operate in one state, you will need to complete a registration in only this state. On the other hand, if you want to do business in multiple states, you should incorporate in a state with business-friendly laws:
All three of these states have laws that are beneficial to large businesses, as well as strong privacy protections and low taxes. Once you've selected a home state, you should register your business as a domestic LLC. Every state will have its own rules for LLC registration, but generally, you will need to file Articles of Organization with your Secretary of State. Before submitting your formation documents, you should pick out a name for your company and appoint a registered agent to receive your company's legal documents. Registering a domestic LLC also requires paying a filing fee.
After your domestic LLC registration is complete, you need to decide in which states you'll register your business. You need to register in every state where you'll transact a significant amount of business. Simply owning a banking account or collecting debts from a single transaction does not require registration. Registration is also not required for interstate commerce in many cases.
Once you've identified the states where you intend to do business, you will need to register your company as a foreign LLC in each state. Check the rules in each state where you need to register before you begin the process. In most states, you will need to present a Certificate of Authority from your home state and file a foreign LLC registration application.
You will need to appoint a registered agent in every state in which you register your business. You will also need to be certain that you have complied with the LLC naming rules in each state. Finally, you will need to pay a filing fee, which will likely be more expensive than the fee you paid for your domestic LLC registration.
Depending on the rules of the states where you have registered your company, you may need to pay an annual tax based on your company's profits. When registering your foreign LLC, you will file your application with one of three government agencies: the Department of Revenue, Department of Treasury, or Secretary of State.
You may also need to establish an account with several agencies. For instance, you will need an account with the Secretary of State to file annual reports, a Department of Revenue Account to pay sales tax, and a Department of Labor account to pay employment taxes. Before you can conduct any business, you may need to obtain business licenses and permits. You should also research whether you'll need to file a state tax return and what business taxes, if any, you'll have to pay.
Calling the Secretary of State can help you determine what filings you need to complete. The state will examine how strong your presence is in the state and will tell you what forms you should file. For example, if you decide to open a physical business location, your presence will be much stronger than if you have a single employee who works from home.
If you need help incorporating in multiple states, you can post your legal needs on UpCounsel's marketplace. UpCounsel accepts only the top 5 percent of lawyers to its site. Lawyers on UpCounsel come from law schools such as Harvard Law and Yale Law and average 14 years of legal experience, including work with or on behalf of companies like Google, Menlo Ventures, and Airbnb.