Life is unpredictable. After you’ve set up your business as an LLC in one state, the day might come that you’ll have to move your business to a different state.
I recently moved from Jersey City to Westchester County and had to figure out how to move my LLC from NJ to NY. It did involve some paperwork and fees, but wasn’t as much of a headache as I feared. Here’s a list of options for how to move your business to another state.
Which state are you moving to and from?
The first factor that will
determine the best plan of action is what state you’re moving your
business to and from. There are three main
options, but only two are available in some states (including my situation):
1. The ideal, easiest, and cheapest solution is to domesticate your LLC. (This basically means “transferring” your LLC.)
- You would create a domesticated LLC in the new state (first obtain a Certificate of Good Standing from the old state, then file that plus Articles of Domestication with the agency/division in charge of LLC/corporations in the new state.) Then you would dissolve your old LLC (and pay a fee, usually).
- Pros: You will get to keep your old EIN (which means you won’t have to change any bank accounts or other accounts associated with that EIN and you’ll keep your business credit score), and you’ll only be an LLC in one state, which means only meeting one state’s LLC requirements such as submitting annual reports, renewal fees, etc.
- However, not all states allow domestication. Both states must allow domestication in order for you to transfer your LLC this way. The states that do allow domestication are:
- New Hampshire
- New Jersey
- South Carolina
- South Dakota
2. If domestication isn’t an option, the next best, sort-of-simple choice is to register as a foreign LLC in the new state. Your “corporate home” would be the original state, but you would be registered to do business in the new state. You would submit the proper form to the new state to register as a foreign LLC and pay a fee (sometimes quite pricey).
- Cons: You would be registered in two states, which means you would have to comply with the rules of both states, including paying the fee to register in the new state as a foreign LLC, submitting annual reports for both states, and paying renewal fees in both states. These double fees could quickly add up. You would also have to have a registered agent in both states.
- Pros: You get to keep your original EIN (which means that your bank accounts, credit score, and anything associated with your EIN won’t change).
- * Terminology Note: the fee for forming a new LLC is usually called “Articles of Organization” fee, whereas the fee for registering as a foreign LLC is referred to as “Articles of Authority” fee (you’re paying to be “authorized” to do business in that new state).*
3. The slightly complex but cheaper option than #2 is to dissolve the old LLC and form a new LLC. Contact the agency/division of the new state to create an LLC, pay that filing fee, and receive a new EIN. Then, contact the agency/division of the old state to dissolve your original LLC (and pay that fee).
- Cons: You’ll have to start fresh with a new EIN – which means updating your bank account, credit cards, and anything associated with your EIN (including SEP-IRA and SE 401(k) retirement accounts), and your credit score will “reset”.
- Pros: You will only have to deal with the fees and reporting requirements for one state
How long will you be in the new state?
The three biggest pain points about moving your LLC are paperwork, the initial filing fee, and renewal fees. The length of time you plan to be in the new state could determine how to pick the best solution that would minimize those three things.
- If you think the move is permanent, I recommend option #3 – dissolving the old LLC and forming a new LLC. It may be slightly more complicated (and involve some annoying paperwork) at first to set up a new business and start fresh with your new EIN, but it would be a one-time hassle. You would only have to deal with the initial filing fee once and the renewal fees for one state.
- If you only expect the move to be temporary, and think you’ll be returning to the original state soon, I recommend option #2 – creating a foreign LLC. This would require slightly less paperwork/hassle, but you would have to pay an initial fee to start a foreign LLC in the new state and you would have to pay the renewal fees for the new state for as long as you live there (as well as the fees for the old state). However, when you return to your original state, you wouldn’t have to pay the filing fee to form an LLC in the original state again.
Crunch the numbers
Here are the fees for each state so you can crunch the numbers and see what choice makes the most financial sense for you:
Finally, here’s a checklist to help you remember all the places to change your address after the move:
Change of address — business checklist:
- Website & blog (contact page, bio, meta description, etc.)
- Google Maps address
- Instagram bio/description
- Address on Facebook page (address & bio)
- Instagram location tag address will automatically change
- The Knot & WeddingWire storefronts (address, bio, region)Optional: change Preferred Vendors to more local venues/vendors
- Yelp storefront (address & bio)Optional: change Business Recommendations to more local venues/vendors
- Your vendor contact information on Two Bright Lights
- Update address for business bank account
- New checkbook with updated address
- Paypal addressBusiness information, where to mail checks, etc.
- Stamps.com return address
- Youtube & Vimeo address
- Update billing & shipping address of business credit cards
- Update address, EIN, & LLC name with retirement accounts
Change of address – personal checklist:
- Change saved “Home” address on Google Maps
- Change contact information in phone, notebooks, etc. (“If lost, please return to…”)
- Print new return address labels
- Change billing & shipping address on:
- Banks & credit cards – Chase, Capital One, Amex, Bank of America, etc.
- Online accounts – Amazon, Paypal, Ebay, Etsy, etc
- Travel accounts – United, Southwest, EZ Pass, etc.
- Favorite stores – Express, NY & Co, Bed Bath & Beyond, B&H, Starbucks, Acme, etc.
- Change address on Chrome auto-fill
- Update bank address(es)
- New checkbook(s) with updated address
- Change Renter’s/Homeowner’s/Auto/Life Insurance address
- Get updated policy, if necessary
- Register car in new state (get new registration + license + plates)