If you’re an entrepreneur looking to move cross-country, you’re probably wondering how to transfer an LLC to another state. This is by no means a simple process, but as long as you know what you’re doing, you shouldn’t have any problems.
To help you gather more information and go about this task, we’ve decided to outline the two most common options for interstate company transfers. Read on to learn about what they are, how to do them, as well as how to help your employees move to a different home.
Learn How to Transfer an LLC to Another State and Consider Your Options Well in Advance
Long before you start packing your bags, you should do proper research on how to go about this task and avoid legal loopholes. Transferring a business is not only complicated but lengthy. The sooner you begin gathering information, the easier of a time you’ll have as the relocation day approaches. Being prepared is the only surefire way to avoid anxiety about moving. Now, let’s take a look at what your options are.
Option #1: Domestication
Domestication is, simply put, the process of changing the address of your business to another location. Unfortunately, there’s no simple step-by-step process to register another address across the border. Every state has its own rules and standardized procedures in this sense. What you should do is visit the website of the state secretary of the state you are transferring your LLC to. In general, however, you will have to file an application, usually online, and dissolve the business after the domestication process has been completed.
For domestication, you will most likely need to obtain the following documents:
- Form for Domestication or Form for Continuance from the state where you want to register
- Certificate of Good Standing from the state you’re registered in
- A copy of the Form for Dissolution to be filed from the old state where you’re registered
Keep in mind that domestication will impact your expenses, and especially taxes, annual reports, and other fees. This, in turn, may impact yours and your employees’ pay.
Not All States Allow Domestication
One of the biggest issues when it comes to domestication is that it is not regulated on the federal level. In other words, every state has its own set of rules, document filing procedures, and legal requirements. Some states don’t even allow domestication at all. Other states allow it, but only from those states that also allow it.
So what are you supposed to do if the location you’re moving to doesn’t allow domestication? Don’t worry, there’s option #2.
Option #2: Shutting Down the Old Company and Starting a New One
If domestication is not an option for you, or if you’d simply like to explore other possible methods, you can consider this step-by-step process. Let’s be clear: this isn’t exactly a corporation transfer per se. You will be dissolving your current business and opening up a completely new corporation across the border. Let’s take a look at how that’s done.
How to Dissolve the Old Company
There’s more to dissolving an LLC than just filing some paperwork. First, you’ll need approval from all members in writing. Then, you’ll need to obtain and file the Certificate of Dissolution. You can do this by getting in touch with the Office of the Secretary.
The process varies depending on where you live, so make sure you do proper research. You will also need tax clearances on all levels – federal, state, and local, so pay all your debts on time.
Finally, notify all the parties affected by this action, including your creditors, clients, and partners. You might even want to search for a registered legal advising company to make sure everything is done right, especially when it comes to taxes.
Opening an LLC in Another State
Now that your old LLC has been dissolved, it is time to open a new entity after the relocation. Before you do this though, you’ll need to get a new tax ID number. Although the procedure of starting a business slightly varies by location, you’ve already gone through the process once. You shouldn’t have much trouble doing it again. Growing your business from scratch again will be a much more challenging part.
Moving Your Employees
Are you planning on moving some of your current employees to the new or transferred business? That is a great way to ensure you have an already well-organized team at your disposal once the new LLC is set up. However, you can’t exactly just tell your employees to pack up their bags and move to another home.
As a responsible employer, you should make sure to offer some help with the relocation process. The best way to do this is to find a company that offers corporate moving services and packages. If this seems like it would be too much on your plate, you can also offer monetary compensation that will cover the expenses of hiring movers, getting packing services, finding a new home, and using a storage unit.
The satisfaction of your employees should be one of your priorities. If they’re moving because of your business, the least you can do is help them organize a stress-free moving experience. You can do so with the help of reliable movers by your side, so start your search.