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Moving your business to another state isn’t as simple as moving your family to a new home. You have to think about not only your office appliances and furniture but also your employees. You have to think about all the possible scenarios your company will face. You also have to decide if you need to hire a full-service long-distance moving company or you can handle everything on your own.
If you want to know more about how to relocate your business, there are three options you can take to assure that you can continue your operations smoothly.
Option No. 1: Be a ‘Foreign’ Company
This is said to be the easiest process. This option involves keeping your old business address, or at least its original registration, and then registering it in the state you’re relocating to. You’ll have to file your firm as a “foreign company” in your new location.
This way, your business will be registered in two states: the state where you originally registered it and the state you relocated to. This option is also the least costly since you won’t have to spend on closing down your business in the state where you originally opened it.
The problem with this procedure is that you’re also liable in your original state. If in case you open yourself up to any tax liability in your original state, then you’re culpable for that.
Option No. 2: Close and Open
The next option entails opening your business in your new location and then closing down the business you started in your previous residence. You’ll be required to acquire all your assets as well as your liabilities from your old business and attach these to your new business.
A lot of people choose this option because it’s quite simple, too. What they often do is simply close down their original place of business and open up shop in another place. But moving to another state without properly closing your original place of business can make you vulnerable to legal disputes and lawsuits.
Also, you won’t get to retain your old FEIN (Federal Employer Identification Number) and you’ll be required to register for a new one, which can be tedious. On top of that, you’ll be required to get a new business license, which can be equally tedious since licenses differ for each state. Therefore, you have to learn more about the details to this situation. Otherwise you’ll run the risk of holding a license that’s not valid in the new address of your company.
Option No. 3: Merge Them
The last option is to merge your old business with your new one. With this option, you’ll get to retain your old FEIN and the credit you’ve established.
The problem with this option is it’s the most expensive one among the three. But all in all, if you have ample funds and your business is already thriving, this might be your least problematic option, so might as well spend a little if it means you’ll avoid any headaches.