Making Your Move.

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​Why ?

• The target market has changed, and better opportunities exist in a different state.

• Real estate costs (renting, leasing, property taxes, etc.) have risen in the current domicile state and significantly affect profitability.

• The domicile state has imposed additional or raised business taxes and fees.

• The domicile state has implemented more regulations on the industry the business is involved in. 

• Other states may have introduced tax incentives that would benefit the business.

• Redomestication will serve the business owner’s family life more effectively (such as access to better schools for their kids, closer to job opportunities for their

       spouse, or nearer to aging parents, etc.).

• The new state will provide access to a more extensive or more diverse workforce.

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REDOMESTICATION

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Not all states allow companies to redomesticate to their jurisdictions. States that don’t acknowledge redomestication typically require you to dissolve the business in

your current home state and register the brand-new business entity in the new home state. As you might imagine, that process becomes more complicated (and

usually more costly) than filing domestication documents.

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Here is a current list of states which allow out-of-state businesses to domesticate within the state's borders. Each state has its own rules and processes,

 

so it’s crucial that you research any details.

 

• Arizona

• California

• Colorado

• Delaware

• District of Columbia

• Florida

• Idaho

• Indiana

• Kansas

• Kentucky

• Louisiana

• Massachusetts

• Maine

• Mississippi

• Nebraska

• New Hampshire

• New Jersey

• Nevada

• Pennsylvania

• South Carolina

• South Dakota

• Texas

• Utah

• Virginia

• Washington

• Wisconsin

• Wyoming

 

Stay on top of business license and permit requirements

It's important to research any required licenses and permits in the new home state before doing any business there. This may include sales tax registration so you

can report and remit sales tax on taxable goods and services sold in the state. 

Be aware that conducting business without the proper licensing can lead to hefty penalties and legal problems. Also, if you have state or local business licenses

and permits in your current home state, you must cancel them and apply for the required licenses and permits in the new state and local jurisdiction. 

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Prep to report and pay payroll taxes (if applicable 

If you plan to have employees in the new home state, you must register to report and pay the state income tax (SUI) and state unemployment insurance tax (SUI).

These are critical elements for managing payroll and meeting a state’s business compliance requirements.

 

​You may have to find a new bank

If you are using a bank that is not nationally chartered, you may need to close your existing account and open a business account with a bank in the new domicile state. 

 

.Don’t keep the IRS in the dark

Let the IRS know of a change in business location. That way, the agency can update its records and have the correct address on file for your business’s EIN

(Employer Identification Number) or other tax ID number (e.g., your Social Security number).

Ramifications of redomestication

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As with all things related to business entity registration, redomestication will have legal and tax ramifications. It’s wise for to ask your trusted advisors (such as your

attorney, accountant, and tax professional) for guidance as you consider making a move.