Do I need to register a Delaware LLC in California if business is not operating?

Asked over 4 years ago - San Diego, CA

I formed an llc in delaware last year but have not done any business so far, Basically it only exists and its business address is my home address which is in california. I am just keeping it open until I finally decide to do something with it or may be not (it is supposed to be doing export once it starts).

Additional information

I just want to know that I am legally compliant if in case I decide to start actively business under this LLC. My intention is to register LLC as an out of state in California if indeed i start actively business, but for now since I am not doing anything with the company I am trying not to incurr any expenses unless need to.
I read somewhere that I need to register LLC as an out of state in California within 3 1/2 months of forming it. I formed it in Delaware 5 months ago. So where does that leave me? Also what about state tax on LLC when I file my return?

Attorney answers (3)

  1. Antone F. Johnson

    Contributor Level 11

    Answered . No, you do not need to qualify the out-of-state LLC to do business in California if it is not actually transacting any intrastate business in California. The following language is taken directly from the Secretary of State's website (see link below):

    Before transacting intrastate business in California the business must first qualify/register with the California Secretary of State. (California Corporations Code section 2105, 15909.02, 16959 or 17451.) California Corporations Code sections 191, 15901.02(ai) and 17001(ap) define "transacting intrastate business" as entering into repeated and successive transactions of its business in this state, other than interstate or foreign commerce.

    The Secretary of State's office cannot advise you as to whether or not the business must qualify/register to do business in California. If you require assistance in making that determination and to ensure that all issues are considered and addressed appropriately, you should consult with private legal counsel.

  2. Steven Alan Fink

    Contributor Level 20

    Answered . No reason to incur the $800 tax if not operating and earning income in CA.



    The response given is not intended to create, nor does it create an ongoing duty to respond to questions. The response does not form an attorney-client relationship, nor is it intended to be anything other than the educated opinion of the author. It should not be relied upon as legal advice. The response given is based upon the limited facts provided by the person asking the question. To the extent additional or different facts exist, the response might possibly change.

  3. Henry Daniel Lively

    Contributor Level 20

    Answered . You only need to qualify the corporation if you are doing business in CA. Then you will have a filing requirement with CA until you revoke the filing.

    Any individual seeking legal advice for their own situation should retain their own legal counsel as this response provides information that is general in nature and not specific to any person's unique situation. Circular 230 Disclaimer - Advice given in this response cannot be used to eliminate penalties with the IRS or any other governmental agency.

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