LLC domestication is the process of moving an existing LLC to a different state, or bringing a foreign-formed company into a U.S. state, without closing it and starting from scratch. The company keeps its history and contracts, but it files new documents in the destination state and ends its registration in the old one. Not every state offers it, and the name of the process varies, so check the destination state's rules first.
This is general information. Domestication rules and tax effects depend on the states involved and on how your LLC is taxed, so confirm with the state filing office and a tax professional.
Domestication, conversion and re-formation: what is the difference?
- Domestication (or transfer): the same legal entity moves to a new state and continues to exist. Contracts, assets and history carry over.
- Conversion: some states use this term for changing the entity's state or type under that state's statute.
- Re-formation: you form a new LLC in the new state and dissolve the old one. This is a new legal entity, so contracts, licenses and bank accounts have to be moved or reopened.
Why companies domesticate
- The company now operates mainly in another state and wants to avoid paying two states.
- Annual fees or taxes in the current state are higher than in the target state.
- The owners prefer a state's laws on privacy, governance or business courts.
- A foreign company wants to become a U.S. LLC and keep its operating history.
Typical steps
1. Confirm both states allow it
The destination state must have a statute that allows an out-of-state LLC to domesticate, and the home state usually must allow the LLC to leave. Many states do, but not all.
2. Approve it under your operating agreement
The operating agreement normally sets the vote needed. Keep a signed written consent.
3. Prepare the destination filing
This is often called a Certificate or Articles of Domestication (or Conversion), filed together with the new state's formation document. You also need a registered agent in the new state. See registered agent service.
4. Close out the old state
The old state may require a certificate of withdrawal or a filing to show the LLC has left, plus any unpaid annual reports and taxes. Settle these first. Our annual report filing service covers overdue reports.
5. Update the IRS, bank and licenses
The EIN generally stays with the same entity, but you should update the mailing address with Form 8822-B, notify your bank, and update licenses, permits and contracts.
Costs to compare before you move
Add up state filing fees in both states, the new registered agent fee, and the ongoing annual cost. For some owners, annual cost differences are small, and domestication is worth it only if there is a real operating reason. Also consider Delaware's flat annual tax if that is your target state.
Frequently Asked Questions
Can I move my LLC to another state?
Often yes, through domestication or conversion if both states allow it. Otherwise you form a new LLC in the new state and close the old one.
Do I need a new EIN after domestication?
Generally the same entity keeps its EIN, but you should update the IRS address. Confirm with a tax professional if the entity type changes at the same time.
Does domestication create a tax event?
For a pure state change of the same LLC it usually does not by itself, but the answer depends on your facts and states. Ask a tax professional before you file.
How long does LLC domestication take?
The state filings can be processed in days to weeks. Closing the old state, updating the bank and licenses takes additional time.
Can a foreign company domesticate into a U.S. state?
Some states allow it through a domestication or continuance statute. If your state does not, forming a new U.S. LLC is the alternative.
Need help moving your company? See our US company domestication service.
