Moving your business to Florida
An entrepreneur or small business owner may have different reasons for relocating their businesses to any other state apart from their home state. If you have been thinking about moving your business to Florida then you need to start planning early as there are several aspects to consider prior to relocation. This guide will help you understand the process of moving your corporation or LLC to Florida. The article will also impart information on the different methods by which you can relocate your business to this state.
Introduction – Why Florida?
Florida is home to 2.8 million small businesses and this includes domestic entities, foreign businesses, and those that filed for a Florida Certificate of Domestication. The state is also home to 18 companies on the Fortune 500 list like Publix Super Markets, International Assets Holding, Tech Data, FPL Group, and Fidelity National Financial among others. The state offers new businesses a pro-business climate that helps small and medium-sized enterprises to achieve growth and meet their expansion goals. If you plan on moving your business to Florida then it is important to understand the benefits of doing business in this state.
One of the most decisive factors that drive entrepreneurs to transfer a business to Florida is the business climate. Several elements that work harmoniously towards ensuring Florida has one of the best pro-business environments in the nation. Today, small business owners are moving an LLC to Florida or their corporation because they want to be an integral part of the $1 trillion economy. The current economy can be considered as an outcome of several factors including the pro-business environment that offers growth opportunities and startup resources for all forms of businesses.
So, what does the pro-business environment in Florida consist of especially if you are thinking of moving your business to Florida? The environment comprises well-devised state tax policies, a streamlined regulatory environment, affordable land and labor, state of the art infrastructure, economic development projects, the largest foreign trade zone (FTZ) in the US, and competitive cost of doing business. These are just some of the business benefits in Florida that help a company achieve long-term sustainability.
Business-friendly tax structure
Some states in the US are considered good for starting a small business as they have tax benefits, low taxation, higher resources, financial incentives and funding sources, and talent among others. These are some of the business benefits in Florida but one of the most important amongst them is the business-friendly tax structure. Here are three important facts to consider:
- Florida is considered a tax-friendly state as it does not impose an income tax on individuals
- Moving a corporation to Florida means that it will be subject to a 4.458% corporate tax, which used to be 5.5%
- If you own an LLC, sole proprietorship, or S corporation and are moving your business to Florida then you will be exempt from paying any state income tax
Whether you are moving your business to Florida or any other state for that matter, one of the key drivers for business growth is the right employees. The type of skills required by your company will depend purely on the business. For example an IT company may require programmers, coders, web developers, software developers, and graphic designers among others. The availability of a skilled workforce is one of the top business benefits in Florida.
The state is famous for its educational institutions along with access to a variety of on the job training courses and resources. Today, the talent pipeline of the state is considered one of the best in the nation and one of the reasons why entrepreneurs prefer to transfer a business to Florida. The sunshine state is home to 12 public universities, several private colleges, and 6 major medical schools that work closely with the local business communities for building programs reflecting the requirement of industries in Florida. Thus moving an LLC to Florida means that you will never have any dearth of skilled employees.
One of the salient business benefits in Florida is the state incentives program. There is a wide variety of business incentives that include everything from tax credits to grants and loan programs. The objective of these incentives is to increase the bottom-line advantages for a new business thus ensuring its long-term profitability. If you plan on moving your business to Florida then some of the top incentive programs to watch out for are:
- Capital Investment Tax Credit (CITC)
- High Impact Performance Incentive (HIPI)
- Rural Community Development Revolving Loan Fund
- Machinery and Equipment Sales Tax Exemption
- Research & Development Equipment Sales Tax Exemption
- Clean Energy Incentives
- Brownfield Redevelopment Bonus Tax Refund
- Urban Job Tax Credit Program
- General Program Support (GPS) funding program
- Fast Track Project Grant Program
Steps to Move a Corporation to Florida
Since Miami and Tampa Bay started to emerge as new hubs for the tech industry; many entrepreneurs are opting to transfer a business to Florida. If you already own a corporation or have incorporated a business, you can expand your existing business in Florida too. There are three options for moving a corporation to Florida, so let us look at each of the options in detail.
Register as a Foreign Corporation
If you plan on moving your business to Florida then going through the process of foreign qualification is the first option. This option is recommended for those who plan to expand to this state and don’t want to close their business in the home state. Florida domestication of a foreign corporation is governed by 2020 Florida Statutes, FL Stat § 607.1501 – 1520 (2020). The process for a foreign qualification in Florida will include the following steps:
- You will need to designate a Florida registered agent for handling the service of process pursuant to FL Stat § 607.1507 (2020)
- You will need to identify a foreign corporation name, search for name availability, and register the name pursuant to FL Stat § 607.1506 (2020)
- You will have to file the Application by Foreign Corporation for Authorization to Transact Business in Florida pursuant to FL Stat § 607.1503 (2020)
- You will also need to submit a certificate of existence or certificate of good standing issued by your home state
Convert a Foreign Corporation to a Florida entity
The second option for moving your business to Florida is conversion. It is a process where you change the type of entity or you change both entity types as well as the home state. This process is also known as Florida domestication of foreign corporations, which means converting an eligible business entity into a Florida profit corporation. The process involves:
- In case of domestication, you will be required to file Articles of Domestication also known as Florida statement of domestication pursuant to FL Stat § 607.11922 (2020).
- You will also have to file Articles of Incorporation pursuant to FL Stat § 607.0202 (2020) along with a cover letter to the Department of State, Division of Corporations.
- If you are planning to transfer a business to Florida using conversion then you will have to file Articles of Conversion pursuant to FL Stat § 607.11933 (2020) along with Articles of Incorporation and a cover letter.
Dissolve home Corporation and establish new Corporation in Florida
If you don’t want to register a foreign entity, or apply for conversion or Florida domestication of a foreign corporation then the only way to proceed is by dissolving the home corporation and incorporating a new entity in Florida. Dissolving a home corporation can be a time-consuming process as you will need to file paperwork for dissolution or termination according to the home state laws. Once you have dissolved a corporation, you will not be able to transfer a business to Florida but will have to form an entirely new domestic entity. The process for the same is:
- Appoint a Florida registered agent for service of process
- Reserve a business name
- File Articles of Incorporation for a Profit Corporation along with a cover letter and the appropriate fee
- Apply for appropriate business licenses
Do you want to move your corporation to Florida?
Steps to Move an LLC to Florida
Florida is a state with a pro-business climate and offers several opportunities for any form of business to experience growth and expansion. If you plan on moving an LLC to Florida then not only can you take advantage of the state resources but also enjoy tax credits and other incentives. You can transfer a business to Florida and as a limited liability company, there are three options available. Let us check out what these options are.
Register as a foreign LLC
If you have already formed an LLC in another state and want to expand your business to Florida then registering a foreign LLC is the right option. There are times when business owners want to operate their business in multiple states apart from the home state. When moving an LLC to Florida as a foreign entity, the formation will be governed by the 2020 Florida Statutes. The process for moving your business to Florida through foreign qualification will include the following steps:
- Before moving your LLC to Florida, you will need to designate a Florida registered agent for initiating the service of process on behalf of the said LLC pursuant to FL Stat § 605.0113 (2019).
- You will need to choose a name for your foreign LLC, conduct a name availability search, and finally register the name with the Division of Corporations
- To transfer a business to Florida as a foreign LLC, you will have to submit a certificate of existence also known as a certificate of good standing. It has to be issued by the state of formation (home state)
- To register the foreign LLC, you will have to file the Application by Foreign Limited Liability Company for Authorization to Transact Business in Florida pursuant to FL Stat § 605.0902 (2019)
Convert a foreign LLC to a Florida entity
If you plan on moving your business to Florida but don’t want to register as a foreign entity then the best option is to go with the conversion of the entity. It is important to note that if your limited liability company is a non-US entity then it will undergo the process of Florida domestication of foreign LLC and you will have to submit Articles of Domestication pursuant to FL Stat § 605.1055 for the same. If your entity is based in any other state within the US then you will need to follow the process of conversion of “Other Business Entity” into a Florida LLC. The important steps are:
- You will need to file the Articles of Conversion pursuant to Florida statutes, section 605.1045. The information in the Articles is quite similar to that of the Florida statement of domestication and should include the name of the LLC, original jurisdiction of formation, and type of entity it is being converted to.
- You will then be required to file Articles of Organization with the Florida Division of Corporations pursuant to FL Stat § 605.0201.
Dissolve home LLC and form a new LLC in Florida
The process of Florida domestication of foreign LLCs and conversion can be quite complex vis-à-vis simply starting a new limited liability company in Florida. If you don’t want to register as a foreign entity then you don’t have to transfer your business to Florida. You can simply dissolve your existing LLC in its home state or state of formation and then apply for formation of a new LLC in Florida. The process for forming a new LLC will involve the following:
- Hire a Florida registered agent to initiate service of the process
- Reserve a business name
- File Articles of Organization along with a cover letter
- Submit the filing fee
- Apply for appropriate business license or permits
Wondering how to move an LLC to Florida?
Move Your Business to Florida with IncParadise
Florida provides everything that a business needs to sustain, grow, and expand. If you plan on moving your business to Florida then you can take advantage of the numerous resources the state has to offer including a vibrant startup environment. We at IncParadise can help you with the process of moving your corporation or LLC to Florida with ease.
We are one of the top registered agents in the state and the nation and understand different businesses have different requirements. Hence, we also offer a wide variety of additional services like mail forwarding, obtaining an EIN, and Florida annual report filing among others.
Our team will assist you in the process of moving your business to Florida. As a part of the process, the valuation of your business is essential. With our partner Eqvista, you can be assured of precise and reliable valuation results. Visit Eqvista now to know more about them and their services.