CORPORATE TRANSACTIONS & COMPLIANCE BLOG

Forming or Qualifying Limited Liability Companies: Don’t Overlook Important State-Specific Requirements

By: Lizz Hellinga, COGENCY GLOBAL INC. on Tue, Sep 04, 2012

When forming or qualifying a limited liability company (LLC), it is important to be aware of each state’s requirements, since they can differ significantly.

Forming an LLC and Qualifying an LLC resized 600Supporting Document Requirements Can Vary By Entity Type
Depending on the state, the supporting documents required for a corporate qualification may be different from the ones you need for an LLC qualification. For example, Illinois requires a certified copy for a corporate qualification, but a Certificate of Good Standing for an LLC qualification. Some states even require additional documents to accompany the LLC formation filing. For example, Georgia requires a Transmittal Information Sheet to accompany the filing, while Pennsylvania requires a Docketing Statement. To avoid rejection and delays, always review state requirements in advance to ensure you obtain the correct supporting documentation.

Post-Filing Requirements
When you receive the recorded filing back from the state, you may have additional requirements before you are finished forming or qualifying the LLC. Some states have post-filing publication requirements. For example, when forming a domestic LLC in Arizona, publication must begin within 60 days in three consecutive publications in a newspaper of general circulation where the principle place of business in Arizona is located. (Note that there is no publication requirement for an Arizona LLC qualification.) In New York, whether you are forming or qualifying an LLC, you must publish in two newspapers for six consecutive weeks in the county of the known place of business. This publication can be costly ($1,500-$2,000) if publishing in New York County. In both Arizona and New York, Proofs of Publication must be filed at the state level, as well.

Additional Filings Required in Some States
Certain states require that additional filings be made quickly in order for the LLC to remain in good standing. California requires a Statement of Information to be filed within 90 days of the filing. In Nevada, the LLC must file an Initial List of Manager or Members/Business License Application, on or before the last day of the first month after the filing. In the state of Washington, an Initial Report is due within 120 days of the filing. Note that Nevada and Washington will automatically provide these forms when the formation/qualification filing evidence is released. California, however, will very rarely provide the Statement of Information, so it is up to the filer to be aware of these types of requirements.

Determine Requirements In Advance
As you can see, there are a number of important steps that must be taken, which vary by state, when you are forming or qualifying a limited liability company. By reviewing the requirements of all states involved in advance, you can save time and avoid problems and delays.

 

This article is provided for informational purposes only and should not be considered, or relied upon, as legal advice.

Topics: Company Formation and Filing Considerations