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“Does California (CA) allow LLC domestication?” Yes, California allows foreign LLCs to domesticate in California. Keep reading to know “How to domesticate an LLC in California?“, “Is California LLC domestication a good choice?” and more.
What is California LLC Domestication?
LLC domestication in California means changing the location or domicile of your LLC from any state to California. In other words, if you want to move your Georgia LLC to California, for instance, LLC domestication is the best way to do so.
Important
In California, LLC Domestication is called Conversion, while in many other states, LLC Conversion means changing LLC to any other entity such as a corporation, LLP, etc.
By LLC domestication, you change the governing laws of your LLC. Domesticating your LLC into California will have the following benefits over other methods of moving your LLC to California:
- LLC domestication allows you to maintain previous business relationships.
- No need to renew contracts made in the previous state.
- No need to change bank accounts and credit rating.
- You can retain your EIN (Tax ID Number).
- No need to rehire employees.
- No need to transfer assets.
How to Domesticate your LLC in California
There’s always something new to learn in the ever-changing landscape of business, and this same goes for LLC domestication in California. Below, we explained the process of transferring an LLC from any state to California via CA LLC domestication in 3 simple steps.
Acquire a Certificate of Good Standing
A certificate of good standing is also called a certificate of existence or certificate of status in some states. It is a legal document issued by the state authorities, usually the secretary of state.
This certificate verifies that your LLC or corporation was legally formed and operated in a state compliance manner.
Important
In California, the certificate of Good Standing is not mandatory to apply for California Articles of Organization – Conversion (Form LLC-1A) to domesticate your out-of-state LLC in California.
However, Getting a Certificate of Good standing will be better as you are moving your business out from the LLC’s home state, so you should have a record that you have paid all the debts, state taxes, LLC annual fees, and other fees in the state where you initially registered your LLC.
After getting a certificate of good standing, you will have proof that you have timely paid your LLC taxes, submitted LLC annual reports and fees, and follow the state laws in all business operations. Hence, this document will verify that your business is in good standing with the state.
To prove that your LLC is up to date on all important business marks, you need to submit a certificate of status.
Approval of LLC Domestication
Before you file articles of domestication with the California Secretary of State, you need to acquire approval from the state where you originally formed your LLC.
Contact the state department where you initially filed your articles of organization and acquire permission to move your business out of that state.
For instance, if you want to move your Texas LLC to California, you need to get permission to transfer your LLC out of Texas from the Texas Secretary of State.
Moreover, in the case of multi-member LLC, you will also be required to get approval from the majority of LLC members for California LLC domestication.
File an Articles of Domestication California
To formally move your LLC from the LLC’s home state to California, you need to file Articles of Organization – Conversion (Form LLC-1A) downloaded from the California Secretary of State website.
To download both forms, click on the link below:
Depending on your LLC operating agreement, you need the signature of the authorized person to sign the California LLC domestication form. After completing all the information, send the complete forms to:
To file online: bizfileOnline@sos.ca.gov (fastest service)
Mailing Address:
Secretary of State
Business Programs Division
P.O. Box 944260
Sacramento, CA 94244-2600
In Person Filing Address:
Secretary of State
Business Programs Division
Business Entities
1500 11th Street,
Sacramento, CA 95814
Requirements to Complete California Articles of Domestication Form
As mentioned earlier that California articles of domestication are filed with the California articles or organization; the following information/documents will be needed to complete the LLC domestication process:
- LLC domestication approval from the previous state and LLC members
- Name of the domesticating entity (The name of your LLC with which you used to operate your business in the previous state)
- The name of the previous state where your LLC was registered
- California registered agent information
- LLC address in California (principal place of business)
- Signature of the authorized person to initiate LLC domestication
- LLC management structure e.g; Manager Managed or Member-Managed LLC
California LLC Domestication Fee (Cost)
To convert an out-of-state LLC into a California LLC, you need to pay the following fee to the California Secretary of State through check or money order:
- Articles of Organization – Conversion (Form LLC-1A) Fee: $70
- Additional fee for submitting in person: $15
Alternatives to LLC Domestication California
If you do not plan to move your LLC to California permanently, or for any other reason California LLC domestication does not seem suitable, the followings are the alternative to California LLC domestication:
What Next After California LLC Domestication?
Once the state of California domesticates your LLC, the laws of the previous state will no longer apply to your LLC.
Now your LLC will be governed under the LLC statute of California. Now, to remain compliant with the laws of California, you need to:
- Make sure you pay outstanding LLC federal taxes or debts in the previous state.
- Keep your registered agent information up to date. If you don’t have one, you can review top registered agent services here.
- Follow your LLC operating agreement.
- Acquire licenses and permits specifically required by the new state.
- Regularly submit annual reports and fees.
- Pay California annual tax ($800).
Moving an LLC out of California
The California Department of state allows an LLC to move out of California via LLC domestication. However, the law of the other state must permit LLC domestication in its statute.
If the law of the other state does not permit LLC domestication, you should look for alternatives to LLC domestication to transfer your LLC out of California.
For the states that allow LLC domestication, you need to submit a California certificate of status to domesticate your LLC there. Click on the following link to get a California certificate of status.
FAQs on How to Domesticate an LLC in California
Aisha Noreen is an owner of a small business with more than 9 years of experience in the marketing industry. With the wisdom of an old soul, she always seeks innovation and mind-blowing ROI techniques. Her unique approach helped many small businesses thrive and she can surprise you in many ways as well. Believe it or not, her energy, passion, and creativity are contagious enough to transform your business and take it to another level.
