Operating As An LLC In Another State

If I formed my llc in a state but have chosen to do most of my business in another state, do I file all over again in the new state?

– Norman, New Orleans

Answer

If you are actually “transacting” business in another state (state #2), you need to register as a foreign LLC in the new state.

The meaning of “transacting business” is defined by state statute.

Most states do not define what is considered transaction of business by a foreign LLC. Instead, they have a list of activities that do not require registration (I know, strange).

For example, here is Arizona’s statute regarding foreign registration (none of the following activities requires registration):

      1. Maintaining, defending or settling any proceeding.
      2. Holding meetings of the board of directors or members or carrying on other activities concerning internal corporate affairs.
      3. Maintaining bank accounts.
      4. Maintaining offices or agencies for the transfer, exchange and registration of memberships or securities or maintaining trustees or depositaries with respect to those securities.
      5. Selling through independent contractors.
      6. Soliciting or obtaining orders, whether by mail or through employees or agents or otherwise, if the orders require acceptance outside this state before they become contracts.
      7. Creating or acquiring indebtedness, mortgages and security interests in real or personal property.
      8. Securing or collecting debts or enforcing mortgages and security interests in property securing the same.
      9. Owning, without more, real or personal property.
      10. Conducting an isolated transaction that is completed within thirty days and that is not one in the course of repeated transactions of a like nature.
      11. Conducting affairs in interstate commerce.
      12. Being a limited partner of a limited partnership or a member of a limited liability company.

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