Do you own a limited liability company (LLC) created in a state other than Wyoming, but you want to expand your business to the Cowboy State? If so, you’ll need to qualify your foreign LLC in order to transact business in Wyoming.
What is a foreign qualification and how do foreign LLCs function within the state of Wyoming? In this guide, we’ll answer these questions and more.
Rocket Tip: If you’d rather hire an online service to handle this process for you, many of the best LLC services can handle it for you.
What Is a Foreign Qualification?
A foreign qualification enables your limited liability company to do business in the state of Wyoming. It doesn’t matter which state you originally formed your business in ― or in other words, the state your domestic LLC is located in ― as the qualification process to register a foreign LLC in Wyoming is the same regardless of where your domestic LLC is based.
The confusion surrounding foreign qualification usually centers on what it means to “do business” in a state outside of your primary state. This gets especially problematic considering some states don’t strictly define what it means to transact business in that state. Wyoming state law does not define “doing business” in the state.
What Qualifies as ‘Doing Business’ in Wyoming
Though there is no set definition regarding business activity in Wyoming, you will generally need to form a foreign LLC if your business pursues any of the following activities in this state:
What Does NOT Qualify as ‘Doing Business’ in Wyoming
Meanwhile, according to the Wyoming Secretary of State, the following activities are not considered to be “doing business” in Wyoming, and you do not need to qualify a foreign LLC to pursue them:
How to Get Foreign Qualification in Wyoming
According to the Wyoming Secretary of State, “a foreign entity may apply for a certificate to transact business in the state by delivering an application for certificate of authority to the Secretary of State for filing. The application must be accompanied by an original certificate of existence/good standing, dated not more than sixty (60) days prior to filing in Wyoming, authenticated by the Secretary of State or official having custody of corporate records in the state or county of formation.” The application for a Certificate of Authority will also require the following information:
Filing Fee: $100, with the check made payable to the “Wyoming Secretary of State.”
What Is the Penalty for Not Getting Foreign Qualification in Wyoming?
There are three major penalties for failing to qualify a foreign LLC in Wyoming. First, your business will not be able to file a lawsuit against a third party in a Wyoming court. Second, your business will be liable for all unpaid fees and taxes, with 18% interest. And third, your business will be liable for a $5,000 penalty fee, in addition to other costs and penalties to be determined by the state.
Should I Hire a Business Service Provider to File My Wyoming Foreign Qualification?
If you don’t want to handle your foreign qualification on your own, you have options. Some entrepreneurs choose to hire a lawyer to prepare and file their Certificate of Authority, which can be a good option if you’re concerned about getting the job done right. However, attorney’s fees can be quite expensive.
The other option is to hire a business service provider like Incfile or ZenBusiness to register your foreign LLC with the state of Wyoming.
These companies can typically get your foreign qualification done for a fraction of the price of an attorney. This is our preferred route if you don’t want to go with the DIY option.
The process for getting foreign qualification in the state of Wyoming isn’t particularly complicated. It generally takes about 10 days to receive foreign qualification after filing, and the paperwork is relatively straightforward. In addition, Wyoming’s rules and regulations regarding which LLCs need to foreign qualify are considerably looser than many states. Still, this isn’t a process that should be taken lightly, because the penalties for not qualifying a foreign LLC in Wyoming can be severe ― especially if your business has been operating for a long time with qualifying, and you are forced to pay exorbitant penalty fees.
We hope this article managed to answer your questions about obtaining a Wyoming foreign qualification, and we wish you a prosperous business future!