Are you a business owner? Does your company conduct business in any other state than the state where you initially got registered? If yes, then I am bringing this exclusive guideline to help you understand foreign LLC, its registration procedure, and other essential details.
Let’s start from the very basic. Before registering your foreign LLC, you need to have a clear image of a foreign LLC and why you need it.
What Is A Foreign Llc
If your limited liability company (LLC) is expanding, and you want to open it at a new location in a different state, you don’t have to form a new LLC, as you can get the existing LLC registered in a new state.
You must already have familiarity with the basic concept of an LLC but let’s just recall it once. LLC is an abbreviation of Limited Liability Company. It is defined as a type of legal entity that is essential to operate a business.
LLCs are very famous since they provide the same limited liability as a corporation but are comparatively cheaper and easier to form and run.
What Are The Steps For Foreign Llc Registration?
If you want to expand your business in more than one state, you must register your LLC in all domestic or foreign states where you are currently doing a business or planning to do a business.
Your new business registration process in other states is just the same for partnerships and corporations. However, the new LLC would be registered as “foreign” in any state where you want to add a location.
The registration process of a foreign LLC varies for each state. However, I have gathered some points to help you understand the process in general.
These steps will also let you know about any documents you may need in the registration process.
- The first or primary step is to register your LLC (limited liability Company) in the original state where you are currently doing business. In case you already have an LLC for that state, you are all set for a foreign LLC registration.
- After this, you will have to own a bank account in a foreign state for your foreign LLC registration. However, this isn’t always the case, as some states don’t require a dedicated account. Further requirements include a registered agent, distributor, or manufacturer’s representative, maintaining an office or distribution facility or a retail store in the state, owning business property in the state.
- Next, go to the Secretary of State website for that state and the business division (this division has a different name in each state). Search for the state’s requirements for the information you will need in the foreign LLC registration document. (it might be known as an “Application for Authorization” or a “Certificate of Authority.”)
- Then find out the following information from the Secretary of State Website.
- The amount of registration fee for foreign LLC registration in that particular state
- The official address for sending the registration application.
- Fill out the Application for Authorization / Certificate of Authority, or whatever this document is called in that particular state. However, depending on the state, you will require to include:
- The name of the LLC and the name of your business, if they are different.
- The state where your LLC is originally or initially registered with its date of formation and the duration or time period of formation.
- The official address of your original LLC
- And finally, the street address of the foreign LLC for which you are filing a registration application.
- You will also have to comply with the requirements of that state for naming your LLC. This may be something like including the words “limited company” or “LLC” in your business name if you haven’t done so already.
- Some states also require you to have a copy of the original documents, which shows that the LLC has been registered in its original or “home” state. Moreover, these states may also require a copy of the official LLC registration documents.
- In the last, after you have checked your application for accuracy, you can send it to the Secretary of State office, along with a paid check of the registration fee from your business account.
Foreign Llc Vs Domestic Llc
There is a slight difference between both terms. Let me give a clear image of what both terms mean by providing an easy and simple example.
So, let’s start with a domestic LLC;
It is a corporation or limited liability company operating in the same state where it was organized and registered initially. In other words, if you are registering an LLC or corporation in a state which is ideally the only state where you are conducting a business, then it is called a domestic LLC or corporation.
Moreover, a domestic LLC is a business organized under the laws of a state in the U.S.
On the other hand, if a business is registered in another state different from where it was organized, this second state becomes a foreign state. Therefore, your business will be registered as a foreign LLC in this second state.
For instance, if you register your business in Los Angeles with a Los Angeles address, you’re registering as a domestic corporation or LLC. On the contrary, if you also want to do the same business in New York, you will now register as a foreign business (corporation or LLC) in that state.
Frequently Asked Questions
- Can A Foreigner Form An Llc In Usa?
As far as the LLC foreign ownership is concerned, anyone, including a resident or foreigner, can form a Limited Liability Company or LLC in the USA. For this, you do not need to be a U.S. citizen.
- What Is The Protocol For An Llc Foreign Member Tax?
The LLC foreign partner will be considered to be engaged in a U.S. business or trade. However, the LLC should withhold 35% of its profits for taxes. Moreover, this tax should be filed and paid to the IRS on a quarterly basis.