/Business Filings

How to Move A Business To Another State

Happy team of businesspeople moving office, packing boxes, smiling.

When you move from one house to another, you likely have checklist of things you need to take care of in the process…changing your mailing address, calling your cable TV provider, contacting your internet company. But when moving your LLC or corporation to another state, many business owners don’t know where to begin.

While there’s a lot to pay attention to, I think you’ll find it really isn’t terribly difficult when you understand how to go about it.

To operate legally in any state, corporations and LLCs must first register with the state. So, if you’re planning to move your business to a new state, you’ll need to do that.

Generally, you can handle it in one of two ways:

Which approach is the right one for you? That will depend on whether or not your move is permanent and whether or not you’re planning to operate your business in both the existing and new states.

Dissolve The Corporation In The Old State And Start It In The New State

If you intend to permanently move to a new state with no plans to operate your business in the old state, then the least complicated approach is to close the business in your original state and register a new corporation or LLC in the new state. Specific requirements vary from state-to-state, but the typical steps of how to do it include:

  • To dissolve the corporation or LLC in your previous state, file a “Certificate of Termination” or “Articles of Dissolution” document with Secretary of State there. In order for the dissolution to be approved, your company will need to be in good standing with the state—i.e., up to date on state tax payments and state filings.
  • In the new state, file to form a new LLC or Corporation with the Secretary of State.

File A Foreign Qualification In The Second State

If you expect your move will be temporary or you’ll still want to conduct business in your old state, closing your business in your old state and starting a new one elsewhere wouldn’t make much sense. In either of those scenarios, you should keep your corporation or LLC registered in the original state and then file a “foreign qualification” in your new state. It’s the same approach you would take when no move is involved but you want to expand your company to another state.

Individual state requirements may vary, but typically the steps to foreign qualify involve:

  • File the necessary foreign corporation paperwork with the new state’s Secretary of State. Some states refer to it as the “Statement and Designation” and others call it the “Foreign Qualification” application. Either way, you’ll find it resembles the Articles of Incorporation document you used when originally filing your corporation. Expect to provide details about your company, such as the name of your corporation, list of corporate officers, your domestic state, stock information (e.g., number of shares authorized, etc), the principle location or address you’ll be using in your new state, and your registered agent.
  • You’ll probably also need to provide a Certificate of Good Standing document from your domestic state in order to foreign qualify.

Just as you would when moving from an old home to a new home, you’ll want to cross all your t’s and dot all your i’s when taking your business to a new state. Sure there’s work and some cost involved, but filing properly from the start is far less complicated and more affordable than facing the legal ramifications of operating in a state without meeting all requirements.

As with all legal matters, I recommend talking with a professional who can guide you through the process. And if you don’t want to risk mishandling (or don’t want the headaches of haggling with) the paperwork involved, consider using CorpNet.com’s services to ensure you’ve filed everything correctly. Call for a free business consultation: 888.449.2638

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Is a Long-Term Business Loan the Best Choice to Fuel Growth?

Three girls in formal clothes holds a meeting by reading the information on the tablet

A long-term business loan is a good fit for many small business financing needs. If you’re looking for capital to invest in a new building, a big ticket purchase such as a new lathe for a manufacturing plant, or anything else for business use that will likely be depreciated over several years of useful life, a long-term loan could be the appropriate way to finance those longer-term investments in business infrastructure and equipment. Many times those investments are needed to facilitate future business growth.

However, a long-term business loan may not always be the best, or even the only, choice for financing growth.

Growth can also be financed in other ways. While many growth initiatives can be described like the long-term investments mentioned above, many times fueling growth involves taking advantage of short-term opportunities—which might not be the best use for a long-term small business loan, unless you can confidently predict the repeated need for capital for such short-term opportunities. Some of the growth opportunities that might be a good fit for a shorter-term solution include:

  1. Ramping up for a new contract. Sometimes new contracts or new customers require a short-term infusion of capital to get things up and running. It might require a business owner to prepare for new employees, update equipment to facilitate the new contract, purchase additional inventory, or bridge a potential cash flow gap created by a short lag between when you need to deliver on the contract and when you start getting paid. This might be a use case where short-term financing could make more sense than a long-term business loan.
  2. Purchasing quick-turnaround inventory at a discount. This could be another good fit for short-term financing. While it might make sense to finance equipment that will be depreciated over the course of several years with a longer-term loan, it might not make sense to make payments on inventory that will be sold over the course of a few months for several years into the future. Sometimes the accrued interest costs of a long-term loan can negatively impact that inventory’s ROI.
  3. Repairing or updating light business equipment or facilities. Depending upon the nature of your business, this could include updating an older machine with new technology to accommodate new quality control requirements or refreshing the décor or adding additional dining space in a restaurant to accommodate more customers. Many business owners turn to short-term financing to accommodate this type of growth.

The above examples of short-term growth initiatives are representative of some of the needs a business might face facilitating opportunities for growth. Fortunately, small business owners have more options than ever before to encourage growth—choosing the right financing simply requires matching the right loan terms to the loan purpose. In addition to traditional sources like banks, credit unions, or the SBA, depending upon the nature of the growth initiative there are other sources of capital, like online lenders, that could be a good fit.

Loan purpose should drive the decisions about loan term. Evaluating loan purpose before you start looking for a small business loan to finance growth will not only help determine the loan term—in addition to a thoughtful consideration of your current business and personal credit profile, it will help you identify the funding sources where you’ll most likely find success. It will also help you identify how much you should borrow and where you may need to improve your profile.

Accessing capital to fuel small business growth can be a big challenge for many businesses. What’s more, the world of small business lending today requires you to become savvier about your options so you can match your business needs with the right loan.

Once you’ve chosen the right loan for your business needs, it may be time to revisit your business structure and incorporate or form an LLC. Call us anytime at 888.449.2638 for a free business consultation!

Ty Kiisel is a contributing author at BusinessLoans.com, a new resource full of content addressing all aspects of business financing for small business owners. Ty has over 25 years of experience in the trenches of small business, and provides personal anecdotes and valuable tips to help small business owners become more financially responsible.

Image: Adobe Stock

Why Customers Love Us – CorpNet Reviews

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We get asked a lot how we are different from our competitors. Although we offer similar services, we take great pride in our stellar customer service which sets us apart from the rest!

You call us, use our chat feature or email us – one of stellar tenured business filing experts in our Westlake Village, CA headquarters will answer. We’re a small team who wants the best for you and your business! No outsourced call centers here!

Just to show how much our customers love us we are starting a new series on the CorpNet Blog sharing some CorpNet reviews. These clients took the time to leave us a great review and we appreciate every single one of them.

Here is a look at why customers love using CorpNet.com to incorporate, form an LLC, file a DBA and more! Check out all of our reviews on TrustPilot. Are you ready to get your business off the ground? Reach out anytime for a free business consultation.

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Expecting A Tax Refund? 8 Business-Savvy Ways To Spend It Wisely

US treasury check.

According to the IRS, it expects more than 70 percent of taxpayers will receive tax refunds this year. Last year, the average refund of the 109 million issued was $2,797. That’s no chump change!

If you’re one of the fortunate taxpayers who will get a tax refund this year, how are you planning to spend that “bonus”?

Decisions…decisions.

While you may find it tempting to blow the cash on a Louis Vuitton handbag or put a deposit on a tropical vacation getaway, there’s something more fulfilling you can do with that money:

Invest it into your business

Yes, I know it doesn’t sound very sexy at face value. But by putting that money back into your company, you’ll expand upon its potential and promise.

How might you use your tax refund to boost your business? Here are a few ideas for making good use of it:

  • Use the money for a consultation with your accountant about tax planning for the future. Just because you got a refund this year, doesn’t mean you will next year!
  • Give your website a make-over. If you’ve got a DIY site, consider hiring a professional to create one that will more successfully generate traffic and leads.
  • Register to attend a highly regarded business or marketing conference. Not only will you learn a lot of relevant information to make you a more enlightened business owner, but also you’ll make valuable connections with other professionals.
  • Get yourself or an employee some specialized training to up your game in the competitive market. When you expand upon your skill set and hone your craft, you make your products and services more valuable to customers.
  • Ditch an old, unreliable piece of office equipment (e.g., laptop, printer, etc.) and purchase a new one. Equipment that doesn’t do the job well can kill productivity and add a lot of stress. Your refund money will be well spent by giving yourself the tools you need to work more efficiently.
  • Buy yourself an ergonomic desk chair. Your comfort and physical well-being should always be a priority if you want to work like you mean business.
  • Join a well-respected networking group. Do some research and find a group that has highly motivated, accomplished members who have a genuine interest in supporting and encouraging each other. While no networking group membership guarantees you’ll get business from it, a culture of camaraderie provides a firm foundation for referrals and for the purchase of services or products between members of the group.

As you can see, you have plenty of ways to creatively use your tax refund to better your business. Whether you’re just starting your company or want to grow it, make the designer shoes and fancy cocktails in coconuts wait. Consider putting your refund dollars where they’ll really make a difference—into your business.

Image: Adobe Stock

Delving Into The DBA: Does Your Small Business Need To File For One?

unsure young woman scratching her head

DBA who?

Also called a fictitious business name, trade name, or assumed business name, a Doing Business As (DBA) filing lets the public know you’re the true owner of your business.

Do you need one for your business?

You’ll need a DBA if one of the following scenarios applies to you:

1. You’re a sole proprietor or general partnership and want to conduct business using a name that’s different from your own name. For example, if Jane Doe wants to open a gift boutique called Things That Matter, she would need to file a DBA. In some states, you’re allowed to use your personal name in addition to a description of your product or service without filing a DBA. For instance, Jane Doe may not need to file a DBA if she wants to call her business Jane Doe’s Gift Boutique. You will need to file a DBA if your business name indicates a group (such as, The Doe Group) or if you only use your first name (i.e., Jane’s Gift Boutique).

2. You have incorporated or formed a limited liability company (LLC) and are operating your business under a name that is different from the name of your company or LLC. To illustrate this scenario, suppose Jane Doe has formed an LLC called Jane Doe Gift Boutique, LLC and Jane also wants to operate her business under the name Janesgifts.com; the LLC would need to file for a DBA for Janesgifts.com. Similarly, if Jane wanted to expand into interior design consulting, then Jane Doe Gift Boutique, LLC would need to file a DBA to do business as Jane Doe Interior Design Consultants.

The DBA designation was created to protect consumers by preventing deceitful business owners from operating under a different name to dodge legal trouble. When you file a DBA, you typically need to print an announcement in the local newspaper, so your community knows who owns the business.

What benefits does a DBA deliver?

Above all else, registering a DBA keeps you in compliance with the law. And for sole proprietors who want to avoid complexity and expense, a DBA lets them use a business name without creating a formal a corporation or LLC. Filing a DBA gives the sole proprietor the freedom to use a business name that will help them market their products or services while establishing a separate professional business identity. Realize, however, that while forming an LLC or corporation protects your business name at the state level, a DBA won’t protect your business name from being used by others—that would require trademark protection.

If you’re a sole proprietor, you will need to file a DBA to open a bank account and receive payments in the name of your business from your customers. Most banks will ask for a copy of your filed DBA before they’ll open your account, so you’ll want to file sooner rather than later!

An LLC or corporation may operate multiple businesses without having to create separate legal entities for each business when they have DBAs. For instance, if Jane Doe plans to open several different boutique shops, restaurants, or websites, she might want to set up one corporation with a relatively generic name and then file a DBA for each shop, restaurant, or website.

Essentially, a DBA will help you expand your business while controlling costs and minimizing the amount of paperwork you have to deal with.

How do you file for a DBA?

From state to state and county to county, the requirements for filing a DBA vary. In some states, you register for DBAs at the county level (and individual counties may have different forms and fees). In some states, you register your DBA with the State Secretary of State or another state agency.

Depending on the state you’re located in, you might also need to publish a notice in your local newspaper and then provide proof to the state that you have done so.

To review the different requirement for DBA filings in your state, you can visit the Small Business Administration’s (SBA) website or use a professional legal document filing service to make sure you’re meeting all county and state requirements.

How soon should you register for a DBA?

You should file for a DBA before doing any business under your fictitious business name. Some jurisdictions give you some leeway and will allow you to file shortly after you first use the name. With a DBA a prerequisite to opening a bank account and forming contracts with customers, however, I recommend filing for one upfront. I also encourage you to try our free business name search tool before filing your DBA to see if your preferred business name is available.

Filing a DBA is an affordable way to keep your business in good legal standing from the very start. Ready to begin?

You can start the process quickly and conveniently online at CorpNet.com!

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Should You Convert Your Business Structure to an S Corp?

Question Mark for Making Decisions

You’ve been chugging along as a sole proprietorship for a while now, but you’re beginning to realize that might not be the best idea to protect your business. So you’re considering converting your sole proprietorship to another structure, specifically the S Corporation.

Ask yourself the following questions to determine if now is the right time to convert your business structure.

1. Do You Want to Bring on Investors?

Maybe you bootstrapped your business, but now you’re ready to take the company to the next level, and to do that, you need investors. This is an automatic reason to convert to an S Corp because investors rarely want to invest in a sole proprietorship (it puts their assets at risk).

If you want potential investors to take you seriously, change your structure to an S Corp. That way, they aren’t liable for your company’s debts or legal fees, and they’re more likely to give you the money you need.

2. Are You Worried About Protecting Your Personal Assets?

Did you realize that as a sole proprietor, the law sees you as an individual as the same as your business? That means if you are ever sued, you may have to shell out from your personal savings to cover legal fees if your business doesn’t have the funds.

Incorporating, on the other hand, separates you from your business, providing a legal shield around you that protects your assets and finances from being taken for the business.

3. Are You Looking for Some Tax Relief?

While incorporating won’t magically eliminate your taxes, there are some pretty great tax perks, like only being taxed once (versus twice like with the C Corporation) and being able to report your business profit and loss on your personal income tax forms.

4. Do You Want to Reduce Your Likelihood of an Audit?

Sole proprietors are nine times more likely to get audited than corporations. What does that tell you? It’s time to change your business structure! Being audited can be a paperwork nightmare that can eat up precious time you’re better off spending running your business, so if a simple switch of business structure could reduce your chances, go for it.

5. Do You Plan to Sell Your Business?

Whether you want to sell in a year or 10, the S Corp is the ideal business structure to make that transition a breeze. Because you can’t transfer ownership of a sole proprietorship (it’s tied to you and only you), the S Corp is a better entity to package up and hand over to the new owners.

If these questions made you realize that, yes, you do need to convert your sole proprietorship to an S Corp, now’s the time to do it. As long as you file File Form 2553 by March 15, 2016 (or let CorpNet do it for you), your business will be treated as an S Corp for the 2016 tax year.

Don’t delay! Get your S Corp Election order processed now with CorpNet so you can reap the tax benefits for 2016.

Image: Dollar Photo Club

Converting Your Sole Proprietorship to an LLC in 8 Simple Steps

Two hands figuring number eightAny business that doesn’t deliberately choose a business structure launches by default as a sole proprietorship (or a partnership, if it has partners). But sometimes down the road, needs change, and the business starts to consider a different structure to protect itself.

If this describes your business, read on. I’ll tell you how to easily convert your existing sole proprietorship into an LLC.

But First, Why Switch?

There are several reasons to move from a sole proprietorship to an LLC, including:

  • What started out as a hobby has become a veritable business, and you want to protect it
  • You don’t want your personal assets to be at risk
  • You want to take advantage of pass through taxation and other tax benefits
  • Your client or investor requires you to be an LLC

Step 1: See if Your Name is Available

Just because you’ve been operating as “Beth’s Bonnets” for years doesn’t mean that name is necessarily available in the state where you want to form an LLC. That’s why you need to conduct a corporate name search to make sure it’s available for your new LLC. If the name you want isn’t available, you might have to slightly modify it. Continue reading “Converting Your Sole Proprietorship to an LLC in 8 Simple Steps” »

By | December 23rd, 2015|Business Filings, Forming An LLC|0 Comments

5 Weeks Left in 2015. Is Your Business Ready for the New Year?

Businessman jumps to The New Year 2016.

Boy, the year has just flown by, hasn’t it? Before you know it, you’ll be ringing in 2016 and getting a fresh start with a new year. But before you break out the champagne, make sure your business is ready to close out the year. Here, I’ve broken down some administrative tasks you need to take care of by the week so you don’t end up rushing around at the end of December to handle it all!

Week 1: Change Your Business Structure

If you want to incorporate your business or form an LLC for 2016, now is the time to get on it. Keep in mind: your Secretary of State gets a ton of applications for new business structures this time of year, so you may have to rush your order or use the delayed filing option to ensure you start the New Year with your new structure. Don’t put this off!

Week 2: Check Your Budgets for the Year

Have you spent all the money you budgeted for different parts of your business? If you still have wiggle room, now is the time to go shopping. Spending money on business expenses now — i.e. a new computer or printer, office supplies, software — will reduce your taxable income for 2015. And if you had a thriving year, you could stand to reduce what you pay in taxes! Continue reading “5 Weeks Left in 2015. Is Your Business Ready for the New Year?” »

By | November 25th, 2015|Business Filings|1 Comment

Articles of Organization: Does Your S Corp Need One?

unsure young woman scratching her headIf you’ve spent any time on this blog or researching how to incorporate your business online, you’ve probably found some terms you weren’t really clear on and had questions. What’s the difference between an LLC and a corporation? What paperwork do I need to file annually? What are Articles of Organization, and do I need them?

Let’s address that last question and talk about Articles of Organization.

First, the LLC vs Corporation Discussion

While ultimately, the LLC and corporation are different, they both provide similar protection and tax benefits. Also, when you either form an LLC or a corporation, there are a lot of similarities in the processes. For both, you have to fill out an application and submit a fee (though the paperwork varies slightly and the fees may be different from one another).

That paperwork is either called Articles of Incorporation (for…you guessed it! Corporations) or Articles of Organization (for LLCs). They serve the same purpose, but don’t really cross streams.

So, to answer your question: you only need to fill out and submit Articles of Organization if you plan to file as an LLC. If you are incorporating as an S Corp (or any other type of corporation) you do not need to fill out Articles of Organization. Continue reading “Articles of Organization: Does Your S Corp Need One?” »

By | November 11th, 2015|Business Filings|0 Comments

What are the Fees for Forming an LLC in DE?

Welcome to Delaware USA Road SignDid you know: 60% of the Fortune 500 have made Delaware their legal home. It’s a popular choice for both corporations and LLCs because of its small business-friendly economy and laws.

If you’re considering starting a business in Delaware, consider the LLC as your business structure. Not only will it protect your personal assets, but it also requires less formal paperwork than its cousin, the corporation.

Here’s what you need to know if you plan to form an LLC in Delaware.

Who to File With

The Delaware Division of Corporations is the entity to file your LLC paperwork with. If you hire CorpNet to file your Delaware LLC paperwork on your behalf, we will send it to the Division of Corporations for you.

You Need a Registered Agent

A registered agent is an individual or business that is authorized to act on your behalf with the State of Delaware. If you do not have a physical presence in Delaware, your registered agent will receive your LLC paperwork and documents on your behalf. Continue reading “What are the Fees for Forming an LLC in DE?” »

By | November 5th, 2015|Business Filings, Fees for Starting a Business|0 Comments