Foreign Qualification

Seeking to transact business in multiple states? BizFilings' foreign qualification services can help, whether you are getting ready to form a business, or you have an established business and are ready to expand into different states.

Corporations and limited liability companies (LLCs) are considered domestic only in their state of formation. In all other states, they are considered a “foreign” entity. If your company expects to transact business outside your state of formation, your company may be required to qualify as a foreign corporation or foreign LLC in the applicable state(s).

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 in the state
• Whether the company has employees in the state
• Whether the company accepts orders in the state
• Whether the company has a bank account in the state

This is not a complete list and different states may have different criteria. However, these are some common factors to consider when trying to determine whether it is necessary for your corporation or LLC to foreign qualify. For questions regarding your specific situation, it is best to seek the advice of an attorney or accountant.

To qualify your company to transact business in another state, you may have to apply for a certificate of good standing from your domestic state, and you must register for a certificate of authority in the state you wish to transact business in, and pay the applicable state filing fees. Keep in mind that corporations and LLCs are subject to taxes and annual report fees in both the state of formation and any states where the company has foreign qualified.

lf you decide it is necessary to foreign qualify your corporation or LLC, BizFilings' Foreign Qualification Service provides everything you need in one turn-key package:

• Preliminary name availability check to ensure your name is available
• Preparation and filing of the certificate of authority
• Obtainment of a certificate of good standing or certified copy
• Initial state filing fees

The typical completion time for the Foreign Qualification Service is 6 to 10 weeks. If time is of the essence, BizFilings also offers an expedited foreign qualification service that reduces the completion time to 3 to 5 weeks.