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Registering as a Foreign LLC in California - how long do I have?

San Diego, CA |

I have formed my LLC in another state and now need to register as a Foreign LLC with the state of California. Is there a rule as far as how soon after my LLC is officially formed, that I need to register it in California (i.e. I must register within "x" days)? I am having a difficult time finding this information.

Attorney Answers 5

Posted

The California Secretary of State information advises that you must register before doing business in California, which is a pretty common rule in most states. Therefore, you should register as a foreign LLC before actually commencing to do business. If you have already started, register immediately. The initial cost is only $70 and you can register through the forms on line.

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Asker

Posted

Do I have to register as a Foreign LLC before I can get a business license?

Kenneth Allyn Sprang

Kenneth Allyn Sprang

Posted

Mr. Jacobson's point is well taken. I infer that you have already created the out of state entity. My preference always runs to DE. However, given the $800 annual fee charged by the Franchise Tax Board in CA to in state and foreign organizations, with CA companies I usually suggest organizing in CA absent a good reason not to, e.g., company is international, plans to go public, etc.

Kenneth Allyn Sprang

Kenneth Allyn Sprang

Posted

You can apply for the license, but under the Code you need to register before beginning to do business. In my view, if you are going to have to register in any event because you have an out of state company and you plan to register it in CA, why not just do it now. Again, the filing fee is quite modest and the registration is a simple task.

Asker

Posted

Great, thanks for you answers. And the reason for forming in another state is becauseI will not be living in CA by the end of this year, and didn't want to continue to be formed in CA (and having to pay the enormous annual franchise tax) and deal with re-forming once I moved - so I formed in a neutral location. Thanks again.

Taleed Rashad El-Sabawi

Taleed Rashad El-Sabawi

Posted

The steps are, indeed, pretty simple to register. You will have to provide a Certificate of Good Standing for your LLC from the state that your entity is registered in, with your registration application. Best, Taleed El-Sabawi Kersey and Sabawi, PC www.kerseysabawi.com

Posted

The applicable Code section (please see the first link below) states that your LLC must be registered ""[b]efore transacting intrastate business in this state".

As concerns what constitutes transacting intrastate business, please see the post at the second link, below.

This information does not constitute legal advice and does not establish an attorney-client relationship.

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Posted

Do I have to register as a Foreign LLC before I can get a business license?

Dana Howard Shultz

Dana Howard Shultz

Posted

You should check your city's website to determine its requirements. In San Diego, the answer is "no".

Posted

Attorneys Sprang and Schultz gave good responses, which I fully endorse. However, there is the question of the need to form a company in another state. Are you doing business in that state? Is there a need to be registered both there and here? If you are not doing business in that other state, you might save money over the long run by just starting a California LLC here, and skip the need to file things in two states.

www.bayoaklaw.com. 510-208-5500. This answer does not create an attorney-client relationship. It is not legal advice, because it is only of a general nature. Please contact a lawyer qualified in your jurisdiction to discuss your situation in confidence, using your factual details. Avvo answers are only general legal responses. Item 9 of Avvo.com's Terms and Conditions are incorporated in this disclaimer as though it were printed here.

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Posted

"Doing business in California" can be defined in various ways. The California State Board of Equalization, for example, considers the following "doing business in California":

If you have an office, sales room, warehouse, or other place of business in this state (even if the location is only temporary), or; Have a sales representative, agent, or canvasser operating in this state, or; Receive rental payments from the lease of tangible personal property located in this state.

The Franchise Tax Board uses an even broader definition: "Doing business" means actively engaging in any transaction for the purpose of financial or pecuniary gain or profit. (R&TC Section 23101).

California's arm is very broad.

This answer does not constitute legal advice and is provided for informational purposes only.

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Posted

Do I have to register as a Foreign LLC before I can get a business license?

Rosana G Herrera

Rosana G Herrera

Posted

Not necessarily. You will need to obtain a business license from the city in which you will be conducting business within the State of California. You will also need to obtain a California seller's permit through the California Board of Equalization, if you sell or lease merchandise, vehicles, or other tangible personal property within the State of California. The license and the permit will both be issued to the owner and the address listed on the permit/license application. Thus, you can register for these under the foreign LLC, and thereafter or simultaneously register the foreign LLC with the California Secretary of State.

Posted

Keep in mind that if you do not register your foreign LLC in CA you cannot either prosecute or defend any Court litigation in CA.

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