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Foreign LLC Qualification

When a limited liability company is organized in one state it is authorized to do business only in that state.
If the business requires for the company to engage and conduct business in other states, the LLC must register as a foreign LLC in the other states where it will do business.
This requires what is known as a foreign LLC filing and each state varies in its requirements for this filing.
 

When is Foreign LLC Qualification Required?
Unfortunately, there is no one answer to this question. Each state has its own views of what activity is sufficient to be considered conducting business in their state. And, the laws of each state are not very helpful because they do not include an exact definition or a list of what is and is not in this category.
Generally, the factors involve the following:
There are many factors used to determine whether a company is transacting business in a state. Some criteria evaluated include:

  • Whether the company has a physical presence (like an office or warehouse) in the state
  • Whether the company has employees in the state
  • Whether the company accepts orders in the state
  • Whether the company has agents that regularly conduct business on behalf of the company in the state.
If you are in doubt, you can seek the advice of an attorney in your state but if there is any doubt, it is recommended that you register to ensure compliance. In many state there are significant penalties for failure to properly register a limited liability company who is conducting business there. In fact, some state LLC statutes make the owners personally liable for these fees and penalties.
The LLC Expert does not currently offer a foreign LLC registration service. However, if you are in need of services to properly register your limited liability company as a foreign LLC in another state, we have a business partner who is backed by one of the largest legal document, publication and filing companies in the country and they offer an affordable and complete service.
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