How to Move an LLC From One State to Another?
How to move an LLC from one state to another varies by business and by state and you need to check the requirements for the state where you are relocating.3 min read
How to move an LLC from one state to another varies by business and by state. Before making the move, you would need to check the rules and requirements for the state where you are relocating.
Information for Moving an LLC to Another State
Two options are available for moving an LLC. The first and simplest option is to register the LLC as a foreign entity in the new state while maintaining an active registration in the old state. This option lets you continue doing business in the new state and the old state. In this dual situation, you will be responsible for maintaining permits, paying taxes, and filing reports in both states. This can be expensive.
Registering as a foreign entity is also an option if the move is temporary and you plan to move back to the original state of operation. In this situation, you can continue operating as an LLC in the old state and register in the new state as a foreign corporation. You will keep the same employee identification number, permanent business address in the old state, and bank accounts while the LLC does business in the new location.
Having an LLC formed in one state and registered to do business as a foreign LLC in one or more states is acceptable. Delaware is the most common state that corporations choose as their corporate home even if they do business exclusively in other states.
If the LLC is organized in one state and registered to do business in another state, you will be held responsible for taxes and fees incurred by the LLC in the state where it was formed. This can also be costly. For example, California charges an annual franchise fee on all LLCs in the state, even if the LLC does the bulk of its business out of state. The current minimum annual fee is $800.
With the second option, if your plan is to cut ties with the old state and make a clean start in the new state, you would file articles of domestication in the new state and dissolve the LLC in the old state. Check with the new and old state for their criteria for domestication. If either of the states does not allow domestication, you will then register as either a foreign entity or as a new LLC in the new state.
In most states, out-of-state business entities are allowed to domesticate or to convert to a domestic (in-state) entity. Keep in mind that an LLC registered in one state and moving to a new state must be registered with the new state to do business there.
Registering in a New State
To register as a foreign business, you must check with the state agency that handles business filings to determine if you meet the criteria for foreign qualification. If you do, you must submit the appropriate registration application form to the state agency. In some states, you can complete and submit the form for approval from the official agencies website. In other states, the form must be mailed in.
The form will ask for information about the original registration of your LLC. You will need to provide the:
- LLC name.
- Date of registration.
- State where the LLC was originally formed.
If necessary, you must also choose an alternate business name. This may be due to another business already registered under that name. This may also be necessary if the LLC name contains prohibited words not allowed in the new state. Then, you will complete these steps:
- Hire and maintain a registered agent in each state. This is an individual or company responsible for receiving legal paperwork on behalf of the LLC.
- Provide a certificate of good standing from the original state. The form is also known as a certificate of facts, certificate of existence, and certificate of status.
- File, mail, or submit the application and filing fee. This is usually around $100.
- A certificate of registry should be sent to you within five business days.
- Obtain any necessary licenses or permits for your LLC.
Once filed and approved, stay current with the filing and reporting requirements for your LLC in each state.
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