Moving Your Business to Another State
We know that businesses may need to relocate for a variety of reasons. Whether you're moving to be closer to your customer base, to take advantage of a better business climate, or simply to find more affordable office space, relocating your business can be a big undertaking. If you are planning such a move, this article is for you.
In this post, we look at the various methods for changing your company's formation status. Plus, we will debate a different option: instead of changing your state of formation, you can qualify the LLC or corporation in the new location as a foreign entity.
Dissolving Your LLC or Corporation in the Old State
This first option is the most common method for changing your company's formation status.
There are two ways to dissolve your company in the state of formation:
File articles of dissolution with the secretary of state's office, or
Get a court order
The first option is the simplest and most common way to dissolve an LLC or corporation. You will need to file articles of dissolution (also known as a certificate of dissolution) with the secretary of state's office in your old state. Once the LLC or corporation is dissolved, you are free to form a new company in the new state.
The second way to dissolve your LLC or corporation is to get a court order. This is usually necessary when there are disputes among the owners of the company or if the company owes money to creditors. Once you have a court order dissolving the company, you can then form a new company in the new state.
Amending Your Articles of Incorporation or Organization
The second method is less common, but it may be a good option if you want to keep your company name or if you're moving your business to a state where LLCs or corporations are treated differently than they are in your current state.
You'll need to file amended articles of incorporation or organization with your current state's Secretary of State (or equivalent office) and pay a filing fee. To do this, you'll first need to check your state's requirements for filing amended articles of incorporation or organization.
Once you've done that, be sure to prepare the amended articles, which will include your company's new address. After you file the amended articles, notify your registered agent in your current state of the change and provide them with your new address.
Qualifying Your LLC or Corporation as a Foreign Entity in the New State
The third option is ideal if you're moving your business to a state where LLCs or corporations are taxed differently than they are in your current state.
You'll need to file a certificate of authority (also known as a foreign qualification or registration) with the new state's secretary of state's office.
You'll also have to provide a copy of your articles of incorporation or organization, as well as a filing fee. Once you're approved, you'll be able to conduct business in the new state as a foreign entity.
Remember to update your registered agent information in your new state and notify them of your new address. Do not forget to update your company's records and file any necessary changes with your state tax agency.
On your priority list should also be:
Notify your customers and clients. Give them plenty of notice that you'll be moving, and provide them with your new contact information.
Update your website and other marketing materials. Be sure to include your new address and phone number on your website, business cards, and other marketing materials.
Contact your state's economic development office. They can provide you with information about business incentives, tax breaks, and other programs that may be available in your new location.
Make arrangements for moving your equipment and inventory. You'll need to transport your office furniture, equipment, and inventory to your new location.
Set up your new office. Once you've moved everything to your new location, you'll need to set up your office and get it up and running.
Takeaway
As you can see, changing the physical location of a business has ramifications for the corporation or LLC that owns it. The people who own the corporation or LLC must make decisions and take measures to ensure they remain legally compliant.