Expanding your LLC into a new state is exciting. To operate there legally, you usually need a foreign qualification. It is the process of registering your existing LLC to do business in another state. LegalZoom can handle the filing for you, so you do not have to figure out each state’s rules on your own. Here is the simple, step-by-step guide.
What “Foreign Qualification” Means
“Foreign” does not mean outside the U.S. It means outside your home state. If your LLC formed in State A and you want to do business in State B, you must qualify as a foreign LLC in State B.
You likely need it if you:
- Have an office, store, warehouse, or team member in the new state
- Meet clients in person there on a regular basis
- Hold inventory or own property there
- Run ongoing projects or services on the ground
Online-only sales with no physical presence may be different. When in doubt, check the state’s definition of “doing business” or speak with a CPA or attorney.
What To Gather Before You File
- Exact legal name of your LLC
- Home state and formation date
- Principal business address and any in-state address you will use
- Registered agent info for the new state
- Responsible party details
- Management style (member-managed or manager-managed)
- Business purpose and NAICS description
- Certificate of Good Standing from your home state (often dated within 30 to 90 days)
Tip: If your name is taken in the new state, you may need a fictitious name or alternate name for that state.
Step-by-Step: Foreign Qualification with LegalZoom
Step 1: Start the Order
Create or sign in to your LegalZoom account. Choose a Foreign qualification and select the state you are entering.
Starting from $0 + filing fee
Key Features
Affordable Formation Services: LegalZoom offers LLC formation starting at $0 plus state filing fees, providing an accessible option for entrepreneurs to establish their businesses
Comprehensive Support: The platform provides step-by-step guidance throughout the LLC formation process, including assistance with filing articles of organization and obtaining an EIN
Additional Business Services: Beyond formation, LegalZoom offers services such as registered agent representation, operating agreement templates, and compliance tools to help maintain your LLC’s good standing
Why We Recommend It
LegalZoom simplifies the process of forming an LLC, making it accessible even for first-time business owners. With affordable pricing and a range of supportive services, it’s a practical choice for entrepreneurs seeking to establish their businesses efficiently.
Pros & Cons
- User-Friendly Platform: LegalZoom's intuitive interface guides users through each step of the LLC formation process
- Comprehensive Free Plan: Offers a robust free plan with access to most features, suitable for small businesses.
- Accessible Pricing: Starting at $0 plus state fees, LegalZoom provides an affordable entry point for new business owners
- Additional Costs for Extras: While the base formation service is affordable, add-ons like registered agent services and expedited filing come at an extra cost
- Potential for Upselling: Users may encounter upselling of additional services during the sign-up process
- Limited Personalized Legal Advice: LegalZoom provides general legal information but does not offer personalized legal advice unless you opt for additional attorney services
Step 2: Enter LLC Details
Provide your LLC’s legal name, home state, formation date, principal address, business purpose, and management style.
Step 3: Registered Agent
Every state requires a registered agent with an in-state address. Choose LegalZoom’s agent service or enter your own agent.
Step 4: Name Check and Options
LegalZoom checks name availability in your target state. If your name conflicts, you can choose an alternate name through the order.
Step 5: Certificate of Good Standing
Upload a recent Certificate of Good Standing from your home state or ask LegalZoom to obtain it for you.
Step 6: Review Processing Speed
Pick standard or expedited filing if the state offers it. Review state fees and service fees at checkout.
Step 7: LegalZoom Files with the State
LegalZoom prepares and submits your Application for Authority to the state. If the state needs more info, they will contact you.
Step 8: Receive Approval
You will receive a Certificate of Authority or approval notice. Save it with your records.
Cost and Timeline
- State fees vary by state.
- Service fee depends on your options.
- Timing ranges from a few days to a few weeks. Many states offer expedited processing for a higher fee.
Plan for both the filing fee and the registered agent fee in your annual budget.
After Approval: Do These Next
- Update banking and payment processors with your new state details if needed
- Register for state tax accounts where required
- Sales tax or seller’s permit
- Employer accounts if you run payroll
- Local licenses or permits for the city or county
- Add the state to your bookkeeping and reporting
- Calendar annual reports for the new state to keep your status active
Common Mistakes to Avoid
- Filing a brand new LLC instead of a foreign qualification when expanding
- Skipping the Certificate of Good Standing or using an outdated one
- Listing the LLC itself as the registered agent when the state requires a person or company
- Name mismatch between state records and your application
- Missing annual report deadlines, which can trigger penalties or revocation
Simple Decision Map
- You are keeping your home-state LLC and adding a new state
File a foreign qualification in the new state
- You are moving states and want your LLC to change states
Check if domestication is allowed. If not, you may dissolve and reform or qualify as foreign, depending on goals
- You only sell online with no people or property in the new state
You may not need a foreign qualification. You may still have sales tax nexus. Confirm with a CPA
Example Scenarios
- You hired your first remote employee in another state
Likely need a foreign qualification and employer tax accounts there
- You started warehousing inventory in another state
A foreign qualification is commonly required, plus sales tax registration
- You do quarterly, in-person client work in another state
If it is regular and ongoing, many states treat that as doing business
Final Take
If you run a multi-state LLC, foreign qualification is the clean, legal way to expand. LegalZoom streamlines the paperwork, handles state rules, and keeps you on track with registered agent requirements. Gather your documents, confirm your state’s needs, and file. Once approved, set up tax accounts, update your records, and keep growing with confidence.
