Registering as a Foreign Corp in other states where you sell
- Thread starter kschuyler
- Start date
BADTROUT
Guru
I don't at present under the indersta ding that I am conducting my business where I am, if I were to open an office or employ someone residing elsewhere it would be a potential requirement... of course it's probably best to check with each state to see if there are any applicable compulsory requirements to do so.
- 2,890
I'm thinking the LLC may have to be registered.
Check with the Scty of State's office in each state.
Check with the Scty of State's office in each state.
- Thread starter
- #4
Thanks... I think I have this figured out. If I was TRULY 100% S/e then I would need to register w the Sec Of state for any state where I am talking with people and selling. But since I am 1099 through another organization I don't think it's required. I'm seeing an accountant soon and will post what I find.
- 11,591
Might want to check with compliance/licensing departments of your companies. While you are individually licensed, and you can sell the policy, if the commission is paid to the LLC, and the LLC isn't licensed/registered for that state, it *might* hold things up?
I'd start with compliance/licensing with your companies and then go from there.
I'd start with compliance/licensing with your companies and then go from there.
- 2,890
People who get 1099s ARE self-employed. Otherwise you'd be an employee and get a W-2. There is no in-between.
This is really what matters.
If the comp is paid to the LLC, you need a Corp license (by state depending on the carriers' PLMA rules) and possibly need to register the biz with the state.
If it is paid to you directly, I wouldn't sweat it.
*not legal nor tax advice
- Thread starter
- #8
I'll post after my meeting tomorrow but here is a link to an attorney's website article.
When Do I Need To Register My Business in Another State? | KKOS Lawyers
Scroll down about 1/2 way and you'll see the area marked:
"The following are examples of activities conducted in another state that typically don't require you to register your business there"..
Point #2 seems pretty clear that for someone making sales by phone as a subscontractor (even though they are LLC'd), it may not be necessary to register as a foreign corp in other states where you talk to clients and make a sale by phone..
Thanks to all participants...stay tuned!
P.S. for a guy making just a high 5 figure salary, registering and paying those fees will be a killer... Not interested...I'll re-think my approach if that's the way it's going to go down.
When Do I Need To Register My Business in Another State? | KKOS Lawyers
Scroll down about 1/2 way and you'll see the area marked:
"The following are examples of activities conducted in another state that typically don't require you to register your business there"..
Point #2 seems pretty clear that for someone making sales by phone as a subscontractor (even though they are LLC'd), it may not be necessary to register as a foreign corp in other states where you talk to clients and make a sale by phone..
Thanks to all participants...stay tuned!
P.S. for a guy making just a high 5 figure salary, registering and paying those fees will be a killer... Not interested...I'll re-think my approach if that's the way it's going to go down.
I've been to the rodeo. Here's the standard set of rules (laws) for most states.
If a business entity, (corporation, partnership, LLC, whatever) wants to be licensed to sell in a state, it must be registered with that state's Secretary of State (SOS) before the Department of Insurance (DOI) will issue a license. Kentucky (my home state) requires a copy of the certificate form the SOS office when submitting licensing for all but a
"general" partnership, which our SOS doesn't register. Since very few insurance agencies are set up a s general partnerships, that exception is sort of a moot point.
In most states, you will end up paying two license fees, one for you as an individual, and one for the LLC. Or, it may simply be two appointment fees you have to pay. Or, it may be two appointment fees and and two license fees; it varies a lot from state to state. Kentucky has no annual license fees, but does have appointment fees. Indiana has no appointment fees, but has license fees. Tennessee charges both a license and an appointment fee. Just know that the LLC fees will be at least as much as individual license fees, and in most state, a bit higher.
The ugly thing about the LLC deal is that each state seems to have a "limited liability entity tax" (LLET) they like to slap an LLC with. For most LLC's, Kentucky's base tax is $175 a year. Ohio is $150. Tennessee's is $300. Understand, I'm not talking about income tax here, but a straight-up tax just because the LLC exists. You may or may not also owe income taxes to that state, which typically would apply in the same manner as if you were doing business in your own name (i.e., not operating under the umbrella of the LLC). The LLET is in addition to any annual report and/or registration fees you might have to pay (KY is $15). Some states have some very quirky LLC rules, and you will have to abide by every state's rules. If you set up in all 50 states, the LLC taxes and fees could total $10,000 easily.
What would I do: I would advise you to just go buy good-quality, high-limit liability insurance policies (professional E&O plus a general slip-and-fall type), and forget the LLC thing if you are moving towards a mass-market, nationwide business model.
If a business entity, (corporation, partnership, LLC, whatever) wants to be licensed to sell in a state, it must be registered with that state's Secretary of State (SOS) before the Department of Insurance (DOI) will issue a license. Kentucky (my home state) requires a copy of the certificate form the SOS office when submitting licensing for all but a
"general" partnership, which our SOS doesn't register. Since very few insurance agencies are set up a s general partnerships, that exception is sort of a moot point.
In most states, you will end up paying two license fees, one for you as an individual, and one for the LLC. Or, it may simply be two appointment fees you have to pay. Or, it may be two appointment fees and and two license fees; it varies a lot from state to state. Kentucky has no annual license fees, but does have appointment fees. Indiana has no appointment fees, but has license fees. Tennessee charges both a license and an appointment fee. Just know that the LLC fees will be at least as much as individual license fees, and in most state, a bit higher.
The ugly thing about the LLC deal is that each state seems to have a "limited liability entity tax" (LLET) they like to slap an LLC with. For most LLC's, Kentucky's base tax is $175 a year. Ohio is $150. Tennessee's is $300. Understand, I'm not talking about income tax here, but a straight-up tax just because the LLC exists. You may or may not also owe income taxes to that state, which typically would apply in the same manner as if you were doing business in your own name (i.e., not operating under the umbrella of the LLC). The LLET is in addition to any annual report and/or registration fees you might have to pay (KY is $15). Some states have some very quirky LLC rules, and you will have to abide by every state's rules. If you set up in all 50 states, the LLC taxes and fees could total $10,000 easily.
What would I do: I would advise you to just go buy good-quality, high-limit liability insurance policies (professional E&O plus a general slip-and-fall type), and forget the LLC thing if you are moving towards a mass-market, nationwide business model.
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