How to Move an LLC From One State to Another: Complete Legal & Tax Guide

 

How to Move an LLC From One State to Another: Complete Legal & Tax Guide

As businesses grow, relocate, or expand, many owners ask:
“How do I move my LLC from one state to another?”

Moving an LLC is not always as simple as changing an address. Because LLCs are created under state law, relocating your business can involve legal filings, tax considerations, and compliance steps—depending on how you move it.

This guide explains all the legal ways to move an LLC to another state, step-by-step, including pros, cons, costs, and which method is best for your situation.

Important Clarification: You Don’t Literally ‘Move’ an LLC

An LLC is legally tied to the state where it was formed.
So when people say “move an LLC,” they usually mean one of these:

  1. Registering the LLC in a new state (foreign LLC)

  2. Converting the LLC to a new state

  3. Domestication (statutory conversion)

  4. Dissolving and re-forming in a new state

The best option depends on state laws, tax goals, and long-term plans.

Option 1: Register as a Foreign LLC (Most Common)

What This Means

Your LLC stays formed in the original state but is authorized to do business in the new state.

When This Makes Sense

✔ You operate in multiple states
✔ You want to keep the original LLC intact
✔ Your original state has favorable laws
✔ You don’t want to disrupt contracts or EIN

Steps

  1. Confirm your LLC is in good standing

  2. Obtain a Certificate of Good Standing

  3. Appoint a registered agent in the new state

  4. File a Foreign LLC Application

  5. Pay filing fees

  6. Comply with annual requirements in both states

Pros

✔ Simple
✔ No new EIN required
✔ Keeps existing contracts intact

Cons

❌ Pay fees and compliance in two states
❌ Ongoing administrative burden

Option 2: LLC Domestication (Best When Available)

What Is Domestication?

Domestication allows your LLC to legally change its home state while remaining the same legal entity.

Not all states allow this.

When This Makes Sense

✔ Both states allow domestication
✔ You want to fully relocate the LLC
✔ You want to keep the same EIN and history

Steps

  1. Confirm both states allow domestication

  2. File domestication paperwork in both states

  3. File new Articles of Organization in the new state

  4. Cancel or withdraw from the old state

Pros

✔ Same LLC, new state
✔ Same EIN
✔ Clean transition

Cons

❌ Not available in all states
❌ More complex filings

Option 3: LLC Conversion (State-to-State Conversion)

What Is Conversion?

A legal process where your LLC converts into an LLC governed by another state’s laws.

Similar to domestication, but terminology varies by state.

When This Makes Sense

✔ Your states allow conversion
✔ You want continuity without dual compliance

Pros

✔ Maintains business continuity
✔ No need to dissolve

Cons

❌ Limited state availability
❌ Filing complexity

Option 4: Dissolve and Re-Form the LLC (Clean Break Option)

What This Means

You close the old LLC and create a brand-new LLC in the new state.

When This Makes Sense

✔ Your original LLC has minimal history
✔ You want to simplify structure
✔ The old state has high fees or taxes
✔ Domestication isn’t available

Steps

  1. Form a new LLC in the new state

  2. Obtain a new EIN (usually required)

  3. Transfer assets and contracts

  4. Notify banks, vendors, and clients

  5. Dissolve the old LLC

Pros

✔ Simple conceptually
✔ Clean compliance

Cons

❌ New EIN
❌ Contracts must be reassigned
❌ Possible tax consequences

Which Method Is Best? (Quick Comparison)

Method Best For EIN Changes Cost
Foreign LLC Multi-state operations ❌ No Medium
Domestication Full relocation ❌ No Medium
Conversion Full relocation ❌ No Medium
Dissolve & Re-form Clean restart ✅ Yes Low–Medium

Tax Considerations When Moving an LLC

Moving an LLC can affect:

✔ State income taxes
✔ Franchise taxes
✔ Sales tax registration
✔ Payroll taxes
✔ Nexus obligations

Key Points:

  • You pay taxes where you operate

  • Forming in a low-tax state does NOT avoid taxes elsewhere

  • Old state tax obligations may continue until properly closed

Consult a CPA before making changes.

Registered Agents and Addresses

When moving states:

  • You must appoint a registered agent in the new state

  • You may be able to cancel the old registered agent

  • Physical presence often triggers tax nexus

What Happens to Your EIN?

Method EIN Needed?
Foreign Registration ❌ No
Domestication ❌ No
Conversion ❌ No
Dissolve & Re-Form ✅ Yes (usually)

Common Mistakes to Avoid

❌ Moving states without registering properly
❌ Forgetting to withdraw from the old state
❌ Ignoring franchise tax obligations
❌ Assuming EIN always transfers
❌ Moving to save taxes without nexus planning
❌ Not updating licenses and permits

These mistakes can result in fines, back taxes, or loss of liability protection.

FAQs: Moving an LLC to Another State

Can I just change my address?

No. That does not change the LLC’s legal state.

Is domestication available everywhere?

No. It depends on both states’ laws.

Do I need a lawyer?

Not always, but recommended for complex moves.

Can I keep my business name?

Usually yes, if available in the new state.

Final Thoughts: How to Move an LLC From One State to Another

There is no one-size-fits-all solution.

Best practice depends on:

  • Where you operate

  • Whether states allow domestication

  • Your tax goals

  • Business complexity

General rule:

  • Expanding? → Foreign LLC

  • Relocating fully? → Domestication or conversion

  • Starting fresh? → Dissolve and re-form

Handled correctly, moving your LLC can simplify operations, reduce costs, and support long-term growth.

Get Free Consultation with FormLLC

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