Why an Attorney Should Domesticate or Convert Your Connecticut LLC to a Florida LLC

Relocating, Domiciling, Transferring, or Converting a Connecticut LLC to a Florida LLC

Updated: August 4, 2023
Reading Time: 10 Minutes

Objectives:

• Domicile a Connecticut Limited Liability Company (LLC) to Florida;
• Maintain the same EIN and identity of the LLC; and
• Enjoy tax benefits provided to Florida residents.

Entities:

• Connecticut Limited Liability Companies (LLCs)

Table of Contents

• What is a Conversion or Domestication?
• Does Connecticut Allow LLCs to Move Out of State?
• Is My Connecticut Entity Dissolved?
• Do I Need To Get a New EIN if I Domesticate My Company to Florida?
• How Does FL Patel Law PLLC Convert My Connecticut LLC to a Florida LLC?
• How Long Does It Take To Complete a Domestication or Conversion to the State of Florida?
• What Are the Costs Involved in Domesticating My Connecticut LLC to the State of Florida?
• What Are Some of the Risks Associated With a Conversion Gone Wrong?
• Increase Your Chances of a Successful Conversion
• What Are the Benefits of Converting My Connecticut LLC to a Florida LLC?
• What Are the Tax Implications of Converting My Connecticut LLC to a Florida LLC?
• Should I Work With Attorney Patel to Convert My Connecticut LLC to a Florida LLC?

Whether you’re looking to enjoy Florida’s lack of a state income tax or our world famous scenery, there are almost endless reasons why a business owner would want to relocate an LLC from Connecticut to Florida. This type of relocation can be made possible by using a legal process called “statutory conversion.”

The risks and requirements to convert a Connecticut LLC to a Florida LLC can be especially intimidating to those who have never handled a project like this before. FL Patel Law PLLC’s guidance can make all the difference and help ensure a seamless transition. Our firm has successfully reorganized over 140 businesses into Florida entities, providing us with the necessary insight to prepare them for success in their new state.

Here, we’ll explain how teaming up with our firm can save your company both time and money while also ensuring a successful, stress free transition from state to state. It also has some warnings about the dangers of attempting to convert a Connecticut LLC to a Florida LLC, as well as how working with our corporate law firm can help avoid delays and other problems during your company’s relocation.

Every state has its own unique requirements for statutory conversions, which can make things confusing if you don’t have the right legal guidance. Certain mistakes can even lead to your LLC’s dissolution and liquidation, which means that engaging with an attorney for this project is an essential part of safeguarding your company well into the future.

Statutory conversions can be used to change an eligible business entity’s formation state. For example, it can be used to change a Connecticut LLC to a Florida LLC.

This process is often referred to as “domestication,” “conversion,” or “transfer” when the entity is converting to a different state. These terms can often be used interchangeably.

Converting a Connecticut LLC to a Florida LLC allows you to relocate your operations without dissolving and reforming your company all over again, which protects its continuity. This, in turn, helps the company maintain the same relationships, contracts, and licenses as a Florida entity that it had as a Connecticut entity. The Connecticut LLC’s rights, assets, privileges, and liabilities will also carry over to the converted business.

Once it becomes a Florida entity, your LLC will be governed by the Florida Revised Limited Liability Company Act. However, your converted LLC might still need to adhere to the Connecticut Uniform Limited Liability Company Act under certain conditions, such as if your business has a nexus or foreign qualification back in its original formation state. You’ll want to bring this up during your initial consultation with our attorney.

Yes, statutory conversion can be used to change a Connecticut LLC to a Florida LLC under Section 34-641 of the Connecticut General Statutes. Connecticut corporations can also reorganize as Florida entities by domesticating to our state, which you can read more about here.

No, and with our attorney managing your entity’s relocation, there’s no need to worry about accidentally dissolving your company, either. You can also ignore any websites or other sources claiming that dissolution is a necessary part of converting a Connecticut LLC to a Florida LLC, as this is incorrect. Dissolution will only lead to your company’s liquidation, which would effectively cancel out many of the benefits of converting your LLC in the first place.

Generally speaking, the Internal Revenue Service (IRS) allows converting entities to keep using the same EIN as long as no changes are made to the business’s corporate identity other than its new formation state, but the agency ultimately decides this on a case-by-case basis. It’s also critical that your business’s continuity is uninterrupted while converting from a Connecticut LLC to a Florida LLC if you want to keep using your original EIN after your company’s move.

Despite the different requirements set by each state, there are some core steps shared by all statutory conversions. That said, what follows is only a generalized overview of our process for domesticating or converting a Connecticut LLC to a Florida LLC. Do not treat it as instructions or advice for doing so. For that kind of personalized guidance, you’ll need to schedule a time with our attorney.

During our initial consultation, we gather information about the client’s business and their goals for relocating their company. This helps us confirm that their LLC is eligible for conversion and gives us information vital to relocating the company without delays, dissolution, or other problems.

The support enjoyed by our clients when they hire us to convert a Connecticut LLC to a Florida LLC includes:

• Drafting the Plan of Conversion and other required documents
• Ensuring compliance with the laws and other legal requirements in both states
• Filing the necessary documents with Connecticut and Florida state agencies
• Updating the LLC’s operating agreement and other corporate documents to reflect its conversion from a Connecticut LLC to a Florida LLC
• A comprehensive consultation to address final concerns and questions

Working with our firm doesn’t just help your company avoid delays – it allows you to convert your Connecticut LLC to a Florida LLC on the fastest timeline possible. In most cases, this will be about two or three months, although this may vary depending on the size of the company and its assets. Much of this efficiency comes from our experience with these transitions, as well as our refined processes for making them happen.

The state agencies responsible for overseeing domestications and conversions will each need several weeks to process your paperwork. This means that it’s essential that your documents have absolutely no mistakes or omissions when filing with Connecticut and Florida, as even small errors could set your company’s move back significantly. You should also keep in mind that these agencies often face delays of their own due to backlogs, short staffing, and other reasons.

Connecticut’s filing fees for your conversion paperwork will be $100.00 which, when added with Florida’s $155.00 filing fee comes to a total of $255.00. Keep in mind that total is just to have your documents processed, too, and doesn’t account for any corrections or second filings that you have to make. Mistakes can also lead to expensive fines and other penalties if your company is thrown out of regulatory compliance during its move.

Our domestication and conversion clients receive flat fees for their projects based on the specific needs of their company’s relocation. This makes budgeting easier and helps prevent unexpected costs. Schedule your consultation with Attorney Patel now to get a quote for converting your Connecticut LLC to a Florida LLC.

Because of the complexities of moving a company across state lines and the different laws in each jurisdiction, there are many opportunities for things to go wrong with your conversion if you don’t have a strong understanding of the process and its requirements. Our legal team’s experience and expertise have given us the insight that we need to prevent these problems before they pose a threat to you or your company.

Some of the threats that you and your company will face if you attempt to convert your Connecticut LLC to a Florida LLC alone include:

• Noncompliance with state laws
• Revocation of the LLC’s operating authority
• Damaged credit standing
• Damaged relationships with clients and vendors
• Disrupted contracts
• Loss of business continuity
• Loss of limited liability protection
• Tax implications and increased tax liabilities
• Legal disputes
• Dissolution or liquidation
• Missed opportunities
• Expensive fines
• Painful delays
• Taxes on Appreciated Assets – Depending on the LLC’s tax structure, its members could end up paying income taxes on appreciated assets if they make any errors during the conversion process. For instance, if an asset that was worth $100,000 at the company’s founding is now worth $1 million, and the company is mistakenly dissolved or liquidated, then the members could be taxed on the gained value.
• Title of Asset Issues – Another benefit of converting a Connecticut LLC to a Florida LLC is that asset titles will automatically transfer over to the domesticated entity – that is, assuming the conversion process was handled correctly. This can make it difficult to prove ownership of those assets, which can cause major headaches when trying to sell a company, among other problems.

Keep in mind that this is not a comprehensive list of the dangers of a failed conversion or domestication from Connecticut to Florida.

With over 140 business conversions and domestications to our credit, our firm’s proven track record means that you can rest easier knowing that your interests are in safe hands when we’re the ones in charge of converting your Connecticut LLC to a Florida LLC.

Don’t put your company’s future in jeopardy by trying to manage its domestication all alone. Hiring FL Patel Law PLLC to convert your Connecticut LLC to a Florida LLC means that you can move forward with less stress and more time to focus on your business.

1. If your company no longer has a nexus in Connecticut after becoming a Florida entity, then it will never have to file with the State of Connecticut ever again.

2. Moving your business to Florida allows you to collaborate with Florida professional accountants, attorneys, and other service providers.

3. Hiring our firm to convert your Connecticut LLC to a Florida LLC means that you can have a seamless transition from state to state free from interruptions, delays, and other problems.

4. Florida Articles of Organization immediately replace your company’s original formation documents, allowing your LLC to retain the same powers, rights, benefits, exemptions, privileges, and principles.

5. Membership interest won’t be changed when converting your Connecticut LLC to a Florida LLC. Real estate and other property rights will also transfer to the Florida LLC after conversion. However, make note that any liabilities of the LLC will remain unaffected by the Florida conversion, as will any pending lawsuits. Any pending legal procedures or actions could be substituted with the name of the Florida LLC.

6. The LLC’s members do not need to live in Florida after domesticating their company here.

7. There will be no need for your LLC to have a nexus (taxable connection) in Connecticut after your business is converted into a Florida entity. This could allow your business to save money on state income taxes and/or other taxes that it had to pay in its original state.

8. Converting a Connecticut LLC to a Florida LLC means that you can keep the same EIN after moving your business, too. This is possible because the company will still be considered to be the same entity that existed previously, just with a new domicile.

9. Another convenience offered by this transition is that your business can also continue using the same bank accounts, the same taxpayer ID, the same operations, and the same contracts. Careful planning, however, should be undertaken to ensure that this is the case.

Many companies relocate to Florida from states in New England, including Connecticut, to escape the region’s high tax rates. However, you shouldn’t expect every tax implication to work in your company’s favor. Consult with your tax professional about this, as the specifics vary from business to business and our legal team can only offer limited guidance in this area. Some things to discuss with them include:

• State Income Tax: One of the most common reasons for relocating a company to Florida is to benefit from our lack of a state income tax. Federal responsibilities will, of course, still exist even after converting your Connecticut LLC to a Florida LLC.

• Franchise Tax: Florida, unlike Connecticut, has no franchise tax. The LLC will need to close its account with the Connecticut Secretary of the State and file final returns if required.

• Nexus: Your business may still need to comply with Connecticut tax laws if it still has a taxable connection (nexus) there after converting into a Florida LLC. Nexus is generally established when a company has a physical presence, employees, or substantial activities in a certain state.

After the LLC has been successfully relocated to Florida, Attorney Patel hosts a comprehensive final consultation to answer any remaining questions our clients might have after converting their Connecticut LLC to a Florida LLC. We also provide them with a post-conversion checklist with instructions to help them adapt to their new responsibilities as Florida business owners.

The benefits of Attorney Patel’s advice can extend far beyond your company’s domestication to Florida. Remember that, as a corporate law firm, we offer a suite of services to support our clients that could prove useful, if not necessary, to your business’s future.

Your company deserves the protection and convenience that comes with hiring us to convert it from a Connecticut LLC to a Florida LLC. By trusting your relocation to our Florida corporate law attorney, you’ll have more time and energy to focus on running your business while we tackle the legal complexities and paperwork. Schedule with us now and get started.

Are you ready to convert your Connecticut LLC to a Florida LLC? Don’t risk breaking your business’s stride — get assistance from an experienced business conversion attorney by calling (727) 279-5037 or by scheduling your initial consultation with us using our online calendar.

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