Introduction – Why Delaware?

What makes this state a popular destination for registration of start-ups and for moving Corporation to Delaware? Today, 67.2 percent of Fortune 500 companies are based out of Delaware and almost 1.4 million legal entities were incorporated in 2018. The number of LLC’s formed in 2018 was 157,142 as compared to 128,852 in 2016 and 44,669 corporation in 2018 as compared to 40,253 in 2016. This is not all, Forbes ranks Delaware #5 when it comes to business costs and the economic growth was at an annual rate of 5.7 percent in 2017, which is faster than the growth rate of the nation at 3.4%.

• Favourable Tax Shelter: Moving Corporation to Delaware or an LLC comes with several benefits as this state is considered to be one of the most favourable tax shelters in the nation. An analysis by New Jersey Business and Industry Association revealed that the state of Delaware had the lowest sales tax rate (zero) in May 2018. Some of the benefits include:
  • There is no sales tax in the state of Delaware
  • The state does not levy corporate tax on any interest
  • A holding corporation in the state that has equity investments or fixed-income investments, will not be taxed on the gains on a state level
  • The state doesn’t have any personal property tax
  • Real estate property tax is applicable on the county level but it is very low as compared to other states
  • The state doesn’t have any value-added taxes (VATs)
  • Delaware doesn’t have any inheritance tax or stock transfer taxes
• The Judicial System: One of the greatest benefits of moving Corporation to Delaware is the judicial system. It is different from any other judicial system in the country and is referred to as the Delaware “Court of Chancery”. This court of equity allows the state of Delaware to adjudicate any corporate litigation. The court can provide guidance and help with litigation for businesses incorporated in Delaware.
• State Incentive Programs: Whether you are moving LLC to Delaware or a business corporation; the state offers a wide range of tax and other incentive programs that businesses can leverage from. Some of the top programs include New Business Facility Tax Credit, New Economy Jobs Tax Credit, Research and Development Tax Credit, Green Industries/Brownfield Tax Credit, Delaware Capital Access Program, State Small Business Credit Initiative Participation Loan, EDGE Grants, Delaware Manufacturing Extension Partnership, and New Business Facility Corporate Income Tax Credit among others.

Steps to Move a Corporation to Delaware

If you are thinking of moving Corporation to Delaware, what are the possible options for moving your business to this state?

The Registration Options

It is important to identify the options for moving Corporation to Delaware. There are 3 options to choose from:

• Register as a Foreign Corporation: One of the ways of moving Corporation to Delaware is to register your business as a Foreign Corporation pursuant to TITLE 8, Chapter 1- Subchapter XVI of the Delaware Code. This option will help you to continue your corporation as it is in your state of incorporation as well as register as a foreign corporation in Delaware. It is important to note that you will be required to file annual report in your home state and “Annual Franchise Tax Report” in Delaware. If you are planning to register as a foreign Corporation then you will be required to file the following documents with the Delaware Division of Corporations:
  • Qualification Certificate of a foreign corporation pursuant to Delaware Code § 371
  • A Certificate of Existence that is dated within six months prior to filing of the Foreign Qualification Certificate
• Dissolve home Corporation and Form New Corporation: This option of moving Corporation to Delaware is applicable if your home state doesn’t allow domestication. The formation of a new corporation is governed by Title 8, Chapter 1 § 101-§ 116 of the Delaware Code. If you dissolve your corporation in the home state then you will be required to apply for a new Tax ID number in Delaware. The documents required to process the incorporation with the Delaware Division of Corporations are:
  • Depending on the type of Corporation like Stock Corporation or Non-Stock Corporation, you will have to file a “Certificate of Incorporation” pursuant to 8 Del. C. 1953, § 102.
  • Certificate of good standing from the existing state of the business entity
  • Registration of Business Name
  • State Business License Application
• Form a New Corporation in Delaware and Merge Old Corporation: If your business is registered in another state or the business entity is considered as a foreign entity then you can form a new Delaware corporation and then merge your existing entity from home state. The requirements for a new corporation in Delaware will be through filing a Certificate of Incorporation. In order to facilitate moving Corporation to Delaware through this option will involve filing merger documents with the Delaware Division of Corporations like:
  • Certificate of Merger of Foreign Corporation into DE Corporation pursuant to 8 Del. C. 1953, § 252
  • Filing Cover Memo

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Steps to Move an LLC to Delaware

Moving LLC to Delaware to benefit from the various tax incentives and other business incentive programs is a good decision but how do you move your LLC? Do you need to form a new LLC or can it continue as the existing entity? Let’s take a look at the options offered by the state of Delaware.

The Registration Options

It is important to identify, how you would want to register your business identity. There are 4 options to choose from:

• Register as a Foreign LLC: One of the ways of moving LLC to Delaware is to register your business as a Foreign LLC pursuant to Title 6, Chapter 18 of Limited Liability Company Act – Subchapter IX. Through this option, you will be able to continue your LLC as it is in your home state and also operate as a foreign LLC in Delaware. The good news is that a foreign LLC is not required to file any annual report although you will be required to pay an annual tax. If you are planning to register as a foreign LLC then you will be required to file the following documents with the Delaware Division of Corporations:
  • Certificate of Registration of Foreign Limited Liability Company pursuant to 68 Del. Laws, § 18-902
  • Certificate of Existence that should be dated within six months prior to the filing date of the Certificate of Registration
  • Filing Cover Memo
• Dissolve home LLC and Form New LLC in Delaware: This option of moving LLC to Delaware is applicable if your home state doesn’t allow domestication or conversion. The formation of a new LLC is governed by Title 6, Chapter 18, of the Limited Liability Company Act. One of the benefits of this option is that dissolving your LLC in home state will not entail any federal tax consequences. The documents required to process the formation with the Delaware Division of Corporations are:
  • You will have to file Certificate of Formation of a Limited Liability Company pursuant to 68 Del. Laws, § 18-201
  • Filing Cover Memo
  • Registration of Business Name
• Form a New LLC in Delaware and Merge Old LLC: What if you want to keep your existing LLC and also want form a domestic entity in Delaware? Is it possible? Yes. In such a scenario, you can form a new LLC in the state and then merge your existing LLC (treated as a foreign LLC). In order to facilitate moving LLC to Delaware through this option will involve filing merger documents with the Delaware Division of Corporations like:
  • Certificate of Merger or Consolidation of Foreign Limited Liability Company into Delaware Limited Liability Company pursuant to Title 6, Section 18-209 of the Delaware Limited Liability Company Act
  • Filing Cover Memo
• Form a New LLC in Delaware and Merge Old LLC: Form an LLC in Delaware: The final option is to form a domestic LLC in Delaware in accordance with Section 18-201 of the Limited Liability Company Act of the State of Delaware. In order to enable moving LLC to Delaware the existing or the original LLC members or owners can contribute membership interests to the new LLC

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Move Your Business to Delaware with IncParadise

The state of Delaware offers several advantages and benefits to LLC’s, Corporations, and other forms of businesses. If you plan on moving LLC to Delaware or your corporation then the processing related to the moving, conversion, or formation of the business entity can be quite complicated and cause inconvenience. This is where you need experts to ensure the entire process is organized and smooth.

Introduction – Why Texas?

Thinking of moving Corporation to Texas? Why do businesses prefer to move to the Lone Star State? Texas is one of the few states that take pride on providing the perfect platform for small and medium sized enterprises (SME’s). This “right to work” state has witnessed a real GDP growth of 7.3 percent in 2018 as compared to -0.2 percent in 2016. Some of the industries that have made maximum contribution to the GDP include finance, insurance, real estate, rental, and leasing with $226.52 billion. Who wouldn’t want to be a part of such a thriving economy?

• Pro-Business Tax Climate: Texas offers a highly competitive tax climate along with other incentives for the overall benefit of different types of businesses. At the end of the day, these tax benefits are targeted at boosting growth as well as the bottom line for those moving LLC to Texas. Some of the salient aspects of the tax benefits include:
  • There are no corporate or personal income tax
  • There are different types of sales tax exemption applicable for businesses especially on machinery and equipment
  • If you are moving Corporation to Texas then you can enjoy franchise tax exemption if you are a seller, manufacturer, or installer of any type of solar energy devices.
  • A business will be able to keep more profit made by the company due to low taxes.
  • Businesses will be able to use lack of personal income taxes as an incentive for hiring purposes.
  • The Texas Economic Development Act, Tax Code Chapter 313 encourages different types of businesses and projects including research and development, large-scale manufacturing, and a variety of investment projects
• State Incentive Programs: Whether you are moving LLC to Texas or a business corporation; the state offers a wide range of incentive and funding programs that small as well as medium sized businesses can leverage from. Some of the top programs include Texas Enterprise Fund (TEF), State Sales and Use Tax refunds, Texas Capital Fund Infrastructure Development and Real Estate Programs (INFRA/RE), Exempt-Facility Bonds, Tax-Exempt Industrial Revenue Bonds, Product Development and Small Business Incubator Fund, collectively (PDSBI), Freeport exemption, Goods-in-Transit Incentive, and Renewable Energy Incentives among others.

Steps to Move a Corporation to Texas

Are you thinking of moving Corporation to Texas? You are probably wondering what the process is for moving your business to this state. Let’s look at the registration options you have.

The Registration Options

It is important to identify the options for moving Corporation to Texas. There are 3 options to choose from:

• Converting a Foreign Corporation to a Texas Filing Entity: If your business is registered in another state or the business entity is considered as a foreign entity then you can convert or “re-domesticate” the foreign entity to a Texas corporation. You will be required to adopt a “plan of conversion” complying with Texas Business Organizations Code BOC §10.103. In order to facilitate moving Corporation to Texas through this option will involve filing of the following documents with the Texas secretary of state:
  • Certificate of Conversion pursuant to Texas Business Organizations Code-BOC § 10.154
  • Certificate of formation for the converted Texas entity
  • Certificate of account status from the Texas Comptroller of Public Accounts that indicates that the converting business entity is in good standing
• Dissolve home Corporation and Establish New Corporation: If your home state doesn’t allow domestication, moving Corporation to Texas or conversion to a Texas business entity then this option is valid. You will have to apply for a new Tax ID number in this state to transact. There are different types of documents that you will be required to file with the Texas Secretary of the state and they are:
  • Depending on the type of Corporation like For-Profit Corporation or Professional Corporation, you will have to file a “Certificate of Formation” pursuant to Titles 1 and 2 of the Texas Business Organizations Code (BOC).
  • Certificate of good standing from the existing state of the business entity
  • Registration of Business Name
  • State Business License Application
• Register as a Foreign Corporation: One of the ways of moving Corporation to Texas is to register your business as a Foreign Corporation pursuant to 2005 Texas Code – Business Corporation Act, Article 8.01 – 8.05. This option is aimed at helping you in continuing the business corporation in the current state of incorporation. It is important to note that you will be required to file annual report or Public Information Report in both Texas and your home state. If you are planning to register as a foreign Corporation then you will be required to file the following documents with the Secretary of State:
  • Application for Registration of a Foreign For-Profit and Professional Corporation also known as the “certificate of authority”
  • A declaration that the said corporation is in good standing

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Steps to Move an LLC to Texas

If you plan moving LLC to Texas that has been formed in another state to Texas then there are several benefits that the LLC will enjoy. The LLC will be able to take advantage of the favourable business laws and tax structure of the state. Let’s take a look at the options you have.

The Registration Options

It is important to identify, how you would want to register your business identity. There are 3 options to choose from:

• Converting a Foreign LLC to a Texas Filing Entity: If your business is registered in another state or is considered to be a foreign entity then what are your options? One of the options is to “re-domesticate” or convert the foreign LLC to a Texas LLC. You can opt for this by adopting a “plan of conversion” that complies with Texas Business Organizations Code BOC §10.103. In order to facilitate moving LLC to Texas using this option, you will be required to file the following documents with the Texas secretary of state:
  • Certificate of Conversion pursuant to Texas Business Organizations Code-BOC § 10.154
  • Certificate of formation for the converted Texas entity pursuant to 2005 Texas Business Organizations Code, § 101.051
  • Certificate of account status from the Texas Comptroller of Public Accounts that indicates that the converting business entity is in good standing
• Register as a Foreign LLC: There is another option for moving LLC to Texas and that is to register your business as a Foreign LLC in Texas pursuant to Chapter 112 of the Business & Commerce Code. This option will help you continue the LLC in the state it was originally registered as well as Texas. This also means that you will be required to file annual reports or public information reports in both Texas and your home state. If you are planning to register as a foreign LLC then you will be required to file the following documents with the Secretary of State:
  • Application for Registration of a Foreign Limited Liability Company pursuant to 2005 Texas Business Organizations Code, § 101.462
  • Notification Statement for “out of state” business entities pursuant to Chapter 112, Business & Commerce Code
• Dissolve home LLC and Form New LLC in Texas: If your home state doesn’t allow domestication or conversion, moving LLC to Texas is one of the best options. In such a scenario, you will be required to apply for a new Tax ID number in Texas. The formation of the new LLC will be governed by Title 3, chapter 101 of the Texas Business Organizations Code (BOC). There are different types of documents that you will be required to file with the Texas Secretary of the state to initiate new LLC formation and they are:
  • You will have to file a “Certificate of Formation” pursuant to Titles 1 and 2 of the Texas Business Organizations Code (BOC).
  • Registration of Business Name
  • State Business License Application

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Move Your Business to Texas with IncParadise

If you have taken a decision related to moving LLC to Texas then it may be quite the hard work to ensure that you are filing all the right documents. If you are feeling overwhelmed then we are right here just for you! IncParadise will ensure that you are able to move your business to Texas with ease. We will guide you with our expertise, knowledge, and commitment so that your business can reach its intended potential in Texas.

Introduction – Why Nevada?

A report released by the Office of Advocacy, U.S Small Business Administration reveals that more than 250,000 small businesses have been registered in the state since the third quarter of 2017 including 2,617 small business exporters. This brings us to the question, why are businesses attracted to Nevada?

• Tax Benefits: One of the biggest advantages of moving LLC to Nevada is the varied amount of tax benefits that are applicable to LLC’s as well as business corporations like:
  • The business registration fees are lower than most states
  • According to the constitution of Nevada, state personal income taxes are prohibited
  • There is no franchise or corporate taxes
  • There are no taxes on corporate profit or shares
  • The tax policies in Nevada ensure that the recipient of your gifts is not liable to pay inheritance tax in the state
  • There is no formal agreement for information sharing with the IRS
• Business Protection Policies: Nevada has a strong asset protection and privacy protection policy for business owners thus helping them retain anonymity. The privacy standards for businesses in the state are quite high and if you are moving Corporation to Nevada or an LLC then you will not be required to list the owners or members with the state. If your business has any investors then their identities will also remain anonymous.
• Other Salient Benefits: Some of the other salient aspects that will benefit a wide range of businesses include:
  • Moving LLC to Nevada doesn’t require you to reside in the state
  • A strong corporate veil in Nevada that provides protection to officers, directors, employees, and agents from liability
  • The state of Nevada ensures businesses don’t have any restrictions on the number of members in any Limited Liability Company
  • Bearer shares are prohibited in Nevada
  • There are a range of programs that LLC’s and Corporations can benefit from like the Emerging Small Business (ESB) Program, Opportunity Zone Incentive Programs, Government Grant Programs, Foreign Trade Zone Programs, and Sales and Use Tax Abatement Programs, among others.

Steps to Move an LLC to Nevada

Moving LLC to Nevada is a highly beneficial decision as the state offers several advantages to small and medium businesses or owners including new and existing businesses. If your business is registered in another state and are planning to establish in Nevada then it should be an informed choice. You need to be aware of the options for moving your business, and information regarding the process.

The Registration Options

It is important to identify, how you would want to register your business identity. There are 3 options to choose from:

• Dissolve home LLC and Establish New LLC: This is the option to choose if your home state doesn’t allow domestication of LLC to Nevada. As such there are no tax consequences but since assets and debts have to be transferred prior to dissolving, you may have to pay taxes for such transfers. Apart from this, you will be required to apply for a new Tax ID number.
• Domesticate LLC in Nevada: If you already have registered your business in another state and are planning on moving LLC to Nevada then one of the options is to domesticate LLC in the state. This is one of the easiest ways to relocate your business to this state. You need to check if your state allows domestication in Nevada like New York doesn’t allow but Wyoming or Mississippi allows businesses to domesticate. In order to domesticate, you will be required to file the Articles of Domestication pursuant to NRS 92A.270 with the Secretary of State.
• Register as a Foreign LLC: The final option for moving LLC to Nevada is to register your business as a Foreign LLC in Nevada pursuant to NV Rev Stat § 86.544 (2013). This option will help you continue the LLC in current state as well, which also means that you will be required to file annual reports in both Nevada and your home state. If you are planning to register as a foreign LLC then you will be required to file an Application for Registration of Foreign Limited Liability Company pursuant to NRS 86.544 with the Secretary of State.

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Steps to Move a Corporation to Nevada

Are you thinking of moving Corporation to Nevada? There are several benefits of moving your business to Nevada but how does this work? Is there a process? The process is similar to that of a Limited Liability Company although the tax consequences will be different.

The Registration Options

It is important to identify the options for moving Corporation to Nevada. There are 3 options to choose from:

• Dissolve home Corporation and Establish New Corporation: If your home state doesn’t allow domestication to Nevada then this option is valid. There could be certain tax disadvantages of this process. You will be required to apply for a new Tax ID number in Nevada. you will be required to file the following documents with the Nevada Secretary of the state:
  • You will be required to file the “Articles of Incorporation Domestic Corporation” pursuant to NRS 78 or “Articles of Incorporation Professional Corporation” pursuant to NRS 89.
  • Certificate of good standing from the existing state of the business entity
  • Registration of Business Name
  • State Business License Application
  • Registered Agent Acceptance/Statement of Change pursuant to NRS 77.310, 77.340, 77.350, 77.380
• Domesticate Corporation in Nevada: If you already have registered your business in another state and are planning on moving Corporation to Nevada then domestication is another option. The board of directors should approve domestication and you will be required to file the following documents with the Nevada Secretary of the state:
  • Articles of Domestication pursuant to NRS 92A.270
  • Charter document of the existing Corporation
  • Charter document for the new Corporation
  • Certificate of good standing from the existing state of the business entity
• Register as a Foreign Corporation: One of the ways of moving Corporation to Nevada is to register your business as a Foreign Corporation pursuant to NV Rev Stat § 80.010 (2014). This option will help you continue the business corporation in the current state (state of incorporation) as well. In such a scenario, you will be required to file annual reports in both Nevada and your home state. If you are planning to register as a foreign Corporation then you will be required to file the following documents with the Secretary of State:
  • Qualification to do Business in Nevada pursuant to NRS Chapter 80
  • A declaration of the existence of the business corporation
  • A declaration that the said corporation is in good standing
  • Information pertaining to authorized stock of the corporation

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Move Your Business to Nevada with IncParadise

If your business exists in another state and you are overwhelmed by the entire process of moving LLC to Nevada or any other type of business then IncParadise is there to ensure the transition is smooth. We are experts in moving or transfer of businesses to other states and can help file the right documents.

Why you need a Registered Agent in Nevada?

Different states in the USA have different laws and regulations pertaining to new business formation or foreign business registration. One of the important aspects of business formation law is that every company should be represented by a registered agent in the state. There are several reasons why any business registering in requires Nevada registered agents. Some of the reasons are:

• By Law: If you are planning to incorporate then pursuant to NRS 78.090, every corporation should have or must be represented by registered agents residing in Nevada or has a business office in this state. If you are planning to form a Limited Liability Company then pursuant to NV Rev Stat § 86.231 (2013), a business entity should have Nevada registered agents having a valid street address in the state for facilitating service of process.
• Active Status: It is important to note that in most states or jurisdictions including Nevada, if a business fails to maintain a registered agent or fails to elect a change of registered agent Nevada, then it can lead to dissolution or revocation of the said business entity’s status. This can be detrimental towards the growth of the business as it will lose the authority to transact business in Nevada.
• Receiving Legal Notices: All businesses or companies can be served legal notices during their operational tenure. This is where the chosen registered agent plays the key role of receiving legal notices from the state on behalf of their clients. The Nevada registered agents protects a business entity from those filing the suits against such businesses
• Ease of process: One of the salient aspects of maintaining Nevada registered agents is the ease of process. Business formation or incorporation is a process that requires submission of articles and providing detailed information regarding the new or existing business. The entire process can be quite cumbersome and confusing. Since, registered agents like IncParadise are familiar with the processing

How can you change your Nevada Registered Agent?

Are you thinking of a change of registered agent in Nevada? How does the process work? A business entity can change their registered agent pursuant to NRS 77.310 by filing or submitting the “Statement of Change of Registered Agent” form with the Secretary of State. The change of registered agent form can be filed by mail, email, fax, or in person.

How long the process takes?

The processing time for changing your registered agent can vary from one state to another. However, the processing time for change of registered agent Nevada takes anywhere from 5-7 days.

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Why choose IncParadise as your Nevada Registered Agent?

The foremost requirement for registering any business entity in the state of Nevada is “physical address”. IncParadise, one of the top and reliable Nevada registered agents, offers your business with a business address or physical address that is legally approved. Some of our other services that you can benefit from include:

• Affordable and Fast Service: One of the salient aspects of choosing IncParadise as Nevada registered agents is that we will ensure you are able to enjoy fast, and secure, submissions and renewal processes. Do you need a change of registered agent?
• Receiving all types of Notices: We as your registered agents in the state of Nevada; will also be your representative when it comes to receiving legal and business related notices. Business related notices include filing annual lists or reports, which is an additional paid service. These services ensure your company is never fined or doesn’t lose its active status due to delay in submission of reports. We will help protect your privacy!
• Online Filing: As your chosen Nevada registered agents, we will provide you with an online account so that you can check and even download any business related documents.
• Top and Reliable agents: IncParadise is one of the top and reliable agents in the state of Nevada because we keep “customer satisfaction” right at the top of the list of services. We have helped in the formation or incorporation of over 10,000 business entities, both foreign and domestic in the USA. Call us today at 702-871-8678, so that we can guide you through the process of change of registered agent Nevada.

What is Texas Certificate of Fact of Good Standing?

Most businesses being incorporated or formed in the state of Texas require several different types of documentation depending on the business type. One such document is the Texas certificate of good standing, which has been changed by the comptroller’s office to “certificate of account status”. There is also a “certificate of fact” or business status issued by the Secretary of State. You are probably wondering what information this document contains or what the importance of such a document is.

Why do I need a Certificate of Fact in Texas?

Why should your company have an active Texas business status? Active status is important as it will ensure that a business entity formed in the state is able to access all the privileges offered by the state including business incentives, loans, and other financial instruments. The reasons you may require this certificate in Texas include:

A certificate of good standing is basically a Texas certificate of fact that highlights that a foreign or domestic limited liability company or corporation has:

• Submitted the franchise tax pursuant to Texas Tax Code, Section 171.255. Business entity needs to ensure it has been paid within the time as established by Texas Tax Code, Section 171.251 along with any delinquent tax and penalty.
• Has appointed and is maintaining a registered agent in the state pursuant to Business Organizations Code, Title 1- General Provisions, Chapter 5, Section 5.252-5.255 and Section 5.302-5.306.
• Have submitted the annual report or the Public Information Report (PIR) pursuant to Texas Tax Code – TAX § 171.203 with the State Comptroller office.

If a company loses the active Texas business status then it will not only lose its right to transact business in this state but will also be denied the right to sue or defend in a court of this state pursuant to Section 171.2515 of the Texas Tax Code. If a business entity forfeits the right to transact then this will have a negative impact on its existing clients, growth, financial transaction, and reputation. Hence, obtaining a certificate of good standing is crucial to the performance of a business.

A business entity will also require a Texas Certificate of Good Standing if they are planning a merger or acquisition, as it will be seen as a legal documentation of the entity.

What is California Certificate of Good Standing?

The certificate of good standing is also known as a Certificate of Status or Certificate of Existence in different jurisdictions. In the state of California, it is considered to be a proof of existence. It highlights California business status being active and having this certificate can help the business entity to enjoy the rights and privileges provided by the law like LLC’s can enjoy the privileges of limited liability. It is important to know that a business needs to be in compliance with all applicable corporate or LLC laws as well as licensing requirements.

Why do I need a Certificate of Good Standing in California?

Maintaining an active California business status is the key to growth through opportunities for every business in the state. You can achieve this status by submitting documents required by the secretary of the state annually including franchise tax. The certificate is issued by the Secretary of State – Business Programs Division and it authorizes new or existing or domestic and foreign business entities to avail of various financial incentives and take advantage of other business opportunities. The reasons you may require this certificate in California include:

A certificate of good standing highlights the fact that the California business status is active. This implies that foreign or domestic limited liability company or corporation has:

• Submitted the franchise tax of pursuant to CA Rev & Tax Code § 19021 – 19027 (2016)
• Has appointed and is maintaining a registered agent in the state pursuant to Corporations Code – CORP § 17701.13 for a business corporation and 2016 California Code – CA Corp Code § 1702 (2016) for a limited liability company
• Have submitted the Statement of Information report with the Secretary of the State pursuant to CA Corp Code § 2206 (2016) for business corporations and Title 2.6 California Revised Uniform Limited Liability Company Act, section 17713.10 for LLC.

The active status implies that a business entity in the state of California will be able to apply for bank loans or federal financial incentives. They will be able to create meaningful and beneficial business partnerships by signing up with vendors, which will eventually create a positive reputation for the company.

A foreign business entity requires a California certificate of good standing by law. According to CA Corp Code § 2101 (2016) for foreign corporations and CA Corp Code § 17708.02 (2016) for a foreign LLC, if a business entity fails to obtain the certificate of existence or good standing then they will not be authorized to transact their business within this State.

A business entity will also require the Certificate of Good Standing if they are planning a merger or acquisition, as it will be seen as a legal documentation of the entity.