Can You Domesticate a Colorado Corporation in Florida?

Can You Domesticate a Colorado Corporation in Florida?

Domesticating or Moving a Colorado C or S Corporation to Florida

Colorado business owners moving to Florida should know about corporate domestication. This is a statutory process for transferring a corporation from one state to another. The process of relocating an LLC, on the other hand, is called conversion. Coming to Florida can be beneficial for many corporations because our state lacks any personal income tax for business owners. Our courts typically rule in favor of businesses as well. For help from an experienced attorney, schedule a consultation with us today.

What Happens to My Colorado Corporation During Domestication?

When our clients ask us how to relocate their corporation to Florida, we generally counsel them to domesticate their businesses instead of starting all over from scratch. Not much else besides your corporation’s jurisdiction will be changed by the process, although it may need to choose a new name if the original is already taken by a Florida entity. To check, you can perform a name availability search on the Florida Division of Corporation’s database. Otherwise, everything stays the same – it’s effectively the same business it always was. It keeps the same EIN and incorporation date, and all contractual rights, property, and real estate are retained, too.

What are the Effects of Domestication?

The effects of domestication on your Colorado business are minimal. The corporation’s stock, securities, eligible interests, and other obligations retain their original value. Ownership in the company persists as it was before the domestication, as do any rights to obtaining shares. The same goes for the shareholder’s rights, which are safeguarded under the terms of the conversion, the FBCA, and the freshly filed Florida Articles of Incorporation. If there are any debts, liabilities, obligations, lawsuits, or other legal proceedings faced by the Colorado corporation, then they will continue uninterrupted against the Florida entity.

Does My Colorado Corporation Dissolve When I Domesticate to Florida?

Your Colorado corporation won’t be interrupted or dissolved by domesticating to Florida unless a serious mistake is made. That’s why it’s advisable to work with a trusted attorney when executing the transfer. You should note, though, that your newly domesticated Florida corporation won’t be able to conduct business in Colorado anymore without filing for a foreign qualification.

How Long Does It Take to Relocate My Business from Colorado to Florida?

You can expect your domestication to take between 1 and 4 weeks, although it might take longer if it owns real estate. For a more accurate timeframe, ask your attorney after they’ve reviewed your business and its assets.

How Do I Domesticate My Colorado C or S Corporation to Florida?

Domesticating your Colorado corporation begins with drafting a plan of domestication. This document explains the corporate domestication process. It needs to cite the statutes authorizing the domestication in both states and also list the expected tax consequences of the move, who owns what, and the transfer of rights and obligations. The plan needs to be approved by the board of directors and the shareholders before filing. And don’t forget to include all the required documents!

Be careful and strictly follow the instructions in both the Florida and Colorado corporate domestication statutes. Failure to do so could cause major problems for your business, including potential dissolution.

Should I Use FL Patel Law to Domesticate my Colorado Corporation?

Absolutely! We have a refined and proven process for domesticating corporations – including Colorado corporations – to Florida. This means that you can let us handle the paperwork for you without worrying about interruptions or other problems cropping up. We serve clients from across the country and in every industry, from consultants to e-commerce businesses, start-ups, and more.

Corporate transactions often come with legal and tax implications. Mistakes during the domestication process could cause you to lose liability protection, discourage potential investors, or even the liquidation of your company. It’s always worth the effort to find a qualified lawyer to assist you.

Does Florida Permit the Domestication of a Colorado Corporation?

Florida permits corporations formed outside of its borders to domesticate if the other state has its own statutes allowing it to occur. It’s the strategy we recommend to our clients because it helps preserve the business’s continuity. A full list of the conditions can be found in Section 607.0101 of the Florida Business Corporation Act (FBCA). Review this section very carefully. Mistakes here could cause dissolution.

Does Colorado Allow Corporations to Domesticate or Move to Florida?             

Yes, per the Colorado Revised Statutes 2018, Title 7, Section 111-101.5.

7-111-101.5. Conversion. A domestic corporation may convert into any form of entity permitted by section 7-90-201 if the board of directors of the corporation adopts a plan of conversion that complies with section 7-90-201.3 and the shareholders of the corporation, if required by section 7-111-103, approve the plan of conversion.

C.R.A. 2018 Title 7 § 111-101.5

Are you ready to get away from the snowy Midwest and move your Colorado corporation down to sunny Florida? Don’t risk breaking your business’s stride — get assistance from an experienced business domestication attorney by calling (727) 279-5037 or visit us online.

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