Can You Domesticate an Indiana Corporation in Florida?
Domesticating or Moving an Indiana C or S Corporation to Florida
This article is to help Indiana business owners who looking to move or domesticate to Florida understand the process of relocating their corporations to Florida. There are many benefits to moving your corporation to Florida such as business-friendly courts and no personal income tax for business owners. If you have a C or an S corporation, you may be able to bring your corporation to Florida through a process called “domestication.” Domestication is a statutory process for moving your corporation from Indiana to Florida. For help with domestication, schedule a consultation with our business lawyer to see if domestication will work for you.
What Happens to My Indiana Corporation During Domestication?
We like to recommend domestication to corporate clients interested in relocating to Florida because it allows them to convert into Florida C or S corporation uninterrupted. The converted corporation is the same business entity that you had back in Indiana. It retains its original employer identification number (EIN), as well as all its real estate, property, and contractual rights. Even the incorporation date stays the same — only the jurisdiction changes. Your Indiana corporation might, however, need a new name if the one it already has is in use by a Florida business. Make sure to perform a name availability check before making any final decisions. You can do this on the Florida Division of Corporation’s website.
What are the Effects of Domestication?
The impact that domestication has on your corporation is minimal, aside from changing its state of residence. The terms of the conversion govern the shareholders’ rights, as do the Florida articles of incorporation and the FBCA. All the Indiana corporation’s shares, rights to acquire shares, eligible interests, securities, and other obligations are reclassified in proportion to their original value. Unfortunately, you should also know that any debts, liabilities, or other obligations held by the corporation back in Indiana will follow the business to Florida, too. The same goes for any lawsuits or other proceedings against the converting entity. The Florida corporation’s name can substitute in for the Indiana corporation at this point, but it is not necessary.
Does My Indiana Corporation Dissolve When I Domesticate to Florida?
Domestication does not “dissolve” your company. Once the process is complete, the company is no longer legally doing business in Indiana. If you would like to continue doing business in Indiana, then you can file a foreign qualification.
How Long Does It Take to Relocate My Business From Indiana to Florida?
This will all depend on the size of your company and assets. That said, standard domestication for companies without real estate can take anywhere from 4 to 12 weeks. You can get a more accurate estimate by engaging an attorney.
How Do I Domesticate My Indiana C or S Corporation to Florida?
In most cases, the corporation starts the domestication process by drafting a plan of domestication. Your plan of domestication explains how the domestication will take place. It includes things like the statutes authorizing domestication, tax consequences, the ownership in the company, transfer of rights and obligations. The plan of conversion then needs to be approved by the board of directors and shareholders. The plan will also include all documents necessary to complete the domestication. Once the plan is approved, your corporation can file the paperwork required by the appropriate governing agencies in both states.
Should I Use FL Patel Law to Domesticate My Indiana Corporation?
Yes! Our firm has helped a lot of business owners and companies relocate to Florida, including Indiana corporations. We have a process that ensures your domestication goes according to your plan. We also provide our clients with additional information and legal support when it comes to operating your corporation in Florida. Our clients come from across the country and from every industry, from consultants to start-ups, e-commerce businesses, and others.
Does Florida Permit the Domestication of an Indiana Corporation?
The good news is that Florida allows corporations formed in another state such as Indiana to domesticate into Florida. However, Indiana must also have its own laws permitting the same. We like to suggest domestication to our clients because it helps ensure their corporation’s continuity. A full list of the conditions to meet and the procedures to follow 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 Indiana Allow Corporations to Domesticate or Move to Florida?
Domestication of domestic corporation in foreign jurisdiction; requirements
Sec. 5. In the case of a domestication of a domestic corporation in a foreign jurisdiction, the following apply:
(1) The plan of domestication must be adopted by the board of directors.
(2) After adopting the plan of domestication, the board of directors must submit the plan to the shareholders for their approval. The board of directors must also transmit to the shareholders a recommendation that the shareholders approve the plan, unless the board of directors makes a determination that because of conflicts of interest or other special circumstances it should not make that recommendation, in which case the board of directors must communicate to the shareholders the basis for that determination.
(3) The board of directors may condition its submission of the plan of domestication to the shareholders on any basis.
(4) If the approval of the shareholders is to be given at a meeting, the corporation must notify each shareholder, whether or not the shareholder is entitled to vote, of the meeting of shareholders at which the plan of domestication is to be submitted for approval. The notice must state that the purpose, or one (1) of the purposes, of the meeting is to consider the plan. The notice must contain or be accompanied by a copy or summary of the plan. The notice must include or be accompanied by a copy of the articles of incorporation as they will be in effect immediately after the domestication.
(5) Unless a greater requirement is established by the articles of incorporation or by the board of directors acting under subdivision (3), the plan of domestication may be submitted for the approval of the shareholders:
(A) at a meeting at which a quorum consisting of at least a majority of the votes entitled to be cast on the plan exists; and
(B) if any class or series of shares is entitled to vote as a separate group on the plan, at a meeting at which a quorum of the voting group consisting of at least a majority of the votes entitled to be cast on the domestication by that voting group is present.
(6) Separate voting on the plan of domestication by voting groups is required by each class or series of shares that:
(A) is to be reclassified under the plan of domestication into other securities, obligations, rights to acquire shares or other securities, cash, other property, or any combination of the types of assets referred to in this clause;
(B) would be entitled to vote as a separate group on a provision of the plan that, if contained in a proposed amendment to articles of incorporation, would require action by separate voting groups under IC 23-1-30-7; or
(C) is entitled under the articles of incorporation to vote as a voting group to approve an amendment of the articles.
As added by P.L.178-2002, SEC.99. Amended by P.L.130-2006, SEC.7.
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