If you are planning to develop business operations in the state other than the state in which you are currently doing business, then you must file for Foreign Entity with the new state in which you want to conduct business. Foreign Entity status will help you to enjoy all benefits that a domestic corporation may have in that state.
What is Foreign Entity?
A Foreign Entity (also called "Out-of-State Entity") is an entity formed in a state other than the state in which your company was originally formed.
As an example, if you have a Nevada registered corporation, and you want to expand your business into New York State (e.g. buy real estate in New York City, etc) then your corporation would have to file as a Foreign Entity within the state of New York. That's also called "applying for authority to conduct business in New York".
Who Should Apply for Foreign Entity?
Typically, if a company conducts only few isolated transactions in a different state, there is no need to register a Foreign Entity in that state.
If, on the other hand, a company plans to develop a more serious business operation in another state, or plan to acquire assets such as real estate, then it must obtain authority to do so from the concerned state department. This process is commonly referred to as "Foreign Entity Qualification" or "Register Foreign Corporation/LLC"
If you are planning to develop business operations in the state other than the state in which you are currently doing business, then you must file for Foreign Entity with the new state (in which you want to conduct business). Foreign Entity status will help you to enjoy all benefits that a domestic corporation may have in that hosting state.
Penalties
Is there any penalty to transact business without getting Certificate of Authority?
Yes. there are. Without Certificate of Authority:
How Do I Register Foreign Entity?
To register Foreign Entity you need to file an application with the concerned authorities and pay a fee. In most states, registration requires disclosure of the company name, state of incorporation/organization and the name and address of the registered agent in the state for which the application is being made. MyUSACorporation.com has made this process easy and simple.
Keeping Your Registered Name
You can form Foreign Entity with your original registered name, provided that this name is available in the state where you plan to register Foreign Entity. Otherwise, your company will have to adopt a name that does not conflict with any other company name or a trade name (DBA).
What Is Limited Liability and Why It Is Important?
Limited liability is a way to make sure that a person who is engaging in business does not risk his or her personal possessions in case the business fails. In other words - you risk what you put in.What Is Corporate Veil And How It Can Be Pierced
If you are a business owner, one of the most significant reasons to incorporate or form a limited liability company is to protect your personal assets from a business creditor's claims against your company. This ability of a properly-formed maintained company to shield its owners from personal liability is sometimes referred to as the "corporate veil."Closing a Chapter: Dissolution of Your Legal Entity.
Various reasons could lead to the business dissolution, such as bankruptcy, retirement, or change in career direction. When an entity is no longer doing business, it is very important to follows the legal steps in "winding itself up" as a legal entity.