Your business is growing, and you’re planning an expansion to other states. It’s a good problem to have!
But it’s not quite as simple as choosing another location. Because each state has different rules and requirements for business operations, you may need a “foreign qualification” in each state where you plan to do business.
It’s a common misconception that foreign qualification is only for businesses operating outside the U.S. But in this case, “foreign” refers to any business operating in a state that isn’t the state where the LLC was originally formed.
Important Note: If you’d like to save time and have the foreign qualification paperwork taken care of for you, many of the best LLC services can handle this task for you.
Foreign qualifying is essentially asking permission to do business in the state of Wyoming. And the notion that “it’s easier to ask forgiveness than permission” doesn’t apply here. Failing to foreign qualify before starting a business in Wyoming yields consequences that are far costlier than registering in the first place. If you fail to foreign qualify, your business:
Say you’ve been doing business in Wyoming for three years. Let’s add up your penalties. Start with that hefty $5,000 fine. Then, let’s add $100 for the Certificate of Authority and $50 per year for annual reports – plus 18% interest – for another $295. That’s a total of $5,295, and it doesn’t even include taxes. In short, it’s best to avoid this entirely by foreign qualifying as soon as you begin doing business in Wyoming.
Check out the Wyoming Statutes, section 17-16-1502 for more info on these penalties.
We’ve established why you shouldn’t do business without a foreign qualification. But what exactly does it mean to “do business” in Wyoming? Unfortunately, you won’t find a specific definition in the state’s LLC Act. Even so, tax laws tell us that you are considered to be “doing business” in most cases and required to foreign qualify if:
Taxes have a role to play in this too. Wyoming charges all of its business entities with a license tax (also known as a franchise tax). Foreign qualification notifies the state that you will need to pay it. It might be tempting to avoid these payments by flying under the radar, but resist the urge! It will lead to more severe fines in the future. It’s important to always stay on top of your LLC’s taxation requirements to avoid any unwelcome surprises.
If you’re unsure whether or not you need to file for a foreign qualification in Wyoming, we suggest seeking legal counsel.
The foreign qualification, however, isn’t a hard and fast rule for all LLCs performing any kind of action in Wyoming. Certain actions do not qualify as “doing business” and therefore don’t require a foreign qualification. Some examples are:
If you find all of your in-state business activities among these exemptions, you most likely don’t have to foreign qualify. Also, be sure to read over the detailed list found in Section 17-16-1501 of the Wyoming Statutes.
Foreign qualification in Wyoming is simple if you know where to find and send your forms. If you or your legal counsel has decided to foreign qualify your LLC in Wyoming, start by downloading and printing an “Application for Certificate of Authority.” This is your ticket to doing business in the state.
To streamline the process, gather all of the required information beforehand. Here’s what you’ll need:
But a completed form is not all you need to foreign qualify. You also need to include:
Got everything? Mail it off to:
Wyoming Secretary of State
Herschler Building East, Suite 101
122 W. 25th St.
Cheyenne, WY 82002-0020
If you live near Cheyenne, you’re also allowed to drop your materials off in person at the same address.
After your form is in and your fee is paid, sit back, take a deep breath, and pat yourself on the back. Your LLC is on its way to foreign qualification and you’re embarking on another chapter in the life of your business.
It’s important to check Wyoming’s business naming requirements to make sure that your LLC name complies. Otherwise, it could delay your foreign qualification. Your business name must:
You can also reserve your Wyoming business name if you’re not quite ready to foreign qualify your LLC.
Considering all the work that goes into expanding your business to a new state, you’ve likely got a lot on your plate. Rather than trying to juggle everything yourself, you can bring on an individual or company to help you secure your LLC’s Wyoming foreign qualification.
For example, business attorneys understand all the legal nuances involved, providing peace of mind that the job will get done correctly. But if you go this route, be sure you have the budget for it. Lawyer fees for Wyoming foreign LLC qualifications can be a prohibitively expensive option for businesses operating on tight budgets.
If you’re operating on a limited budget, but still want to have your Wyoming foreign LLC professionally registered, go with an online business service provider. There are plenty of reputable companies that can help you out with Wyoming foreign qualifications.
We think you should foreign qualify your LLC before you begin conducting business in a new state. If you don’t, your business could be subject to a broad range of fines and penalties for operating an LLC in a jurisdiction where you don’t have permission to do so.
You’ll typically need to wait up to 15 days for Wyoming to process a business filing. This state does not offer expedited service for foreign qualifications.
Chances are, you’ll require at least one license or permit to operate your LLC in compliance with Wyoming state law. Unfortunately, Wyoming does not have a centralized business licensing hub as most states do, so you’ll have to check with any relevant state regulatory agencies, as well as your county and municipal governments, to find out which licenses and permits your business needs.
Yes. Whether you operate a domestic or foreign LLC in this state, you are required to file a Wyoming LLC Annual Report.
The overall costs of operating a Wyoming LLC can vary considerably based on the specifics of your business. However, we created a helpful guide to help you identify and plan for every expense your LLC will face in this state.
The answer to this question lies in your personal preferences, but we can give some general pointers. An attorney will cost the most by a mile, but also provides expertise you won’t find with the other options. The DIY route is free of charge but can require quite a bit of legwork and provides no peace of mind that the process is being completed correctly.
Using an LLC service means your business will be foreign qualified by professionals who know what they’re doing, while also costing significantly less than a lawyer. This “best of both worlds” attribute is what makes LLC services our preferred option.
Using an online LLC service removes much of the hassle from the foreign qualification process. With these services, all you need to do is provide them with the name, location, and industry your business operates in, along with some info about yourself and your Wyoming registered agent.
The service then registers your Application for Certificate of Authority with the state to qualify your LLC to do business in Wyoming.
Absolutely. There are quite a few reputable companies offering LLC formation service and foreign qualifications these days.
In fact, while we certainly have our opinions about which ones offer the best pricing and features, every one of the incorporation services we discuss on this website is entirely legitimate and trustworthy.
Disclaimer: The content on this page is for information purposes only and does not constitute legal, tax, or accounting advice. If you have specific questions about any of these topics, seek the counsel of a licensed professional.
Foreign Qualification by State
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