Can You Relocate or Convert a Washington, D.C., LLC to a Florida LLC?

Relocating, Domiciling, Transferring, or Converting a Washington, D.C., LLC to a Florida LLC

Updated: October 19, 2023
Reading Time: 10 Minutes

Objectives:

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

Entities:

• Washington, D.C., Limited Liability Companies (LLCs)

Table of Contents

• What is a Conversion or Domestication?
• Does Washington, D.C., Allow Limited Liability Companies (LLCs) to Undergo Statutory Conversion?
• Is My Washington, D.C., 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 Washington, D.C., 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 Washington, D.C., 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 Washington, D.C., LLC to a Florida LLC?
• What Are the Tax Implications of Converting My Washington, D.C., LLC to a Florida LLC?
• Should I Work With Attorney Patel to Convert My Washington, D.C., LLC to a Florida LLC?

Not enough business owners know that it’s possible to relocate qualifying LLCs to a new jurisdiction, such as from Washington, D.C., to Florida, without surrendering their business’s identity. This is thanks to a legal process known as “statutory conversion.” When properly executed, it can allow them to enjoy the many advantages of owning a business in Florida without breaking its continuity.

The complexities and different considerations of the conversion process can be a daunting prospect for many business owners, but 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.

This page will help you understand some of the basic steps that our firm takes when we’re hired to convert a Washington, D.C., LLC to a Florida LLC and how those steps can save time and money while also preventing legal issues or other problems from impacting your business’s move. It also has some warnings about the risks that you’ll take on if you try to manage this process without legal guidance, plus some of the different ways that our legal team can help secure a safer transition.

Every statutory conversion project is unique and comes with its own particular requirements. Falling short of these requirements in any way can have painful repercussions for both the LLC and its owners. Our firm has the experience needed to help your company successfully navigate these requirements while ensuring legal compliance and much more.

Statutory conversion is a method that an LLC can use to change its place of formation, which enables it to relocate to a new jurisdiction without breaking its continuity.

This process is often referred to as “domestication,” “conversion,” or “transfer” when the entity is changing its place of formation. These terms can often be used interchangeably.

Converting an entity into a business in a different state also preserves its identity, which minimizes disruptions and helps maintain relationships, contracts, and licenses that are essential to its operations. Because the converted LLC is still the same business that existed before undergoing this process, it will also retain all of the same rights, assets, privileges, and liabilities that it had in Washington, D.C., as well.

The Florida Revised Limited Liability Company Act will begin regulating your entity immediately upon its conversion into a Florida LLC. While this process can often result in the Washington, D.C., Uniform Limited Liability Company Act no longer applying to your business, there are some situations where the LLC could fall under the governance of both laws. These include, but aren’t always limited to, having a nexus or foreign qualification in your LLC’s original place of formation. This is something that you should talk to our attorney about during your initial consultation.

Washington, D.C., authorizes statutory conversion under Section 29-204.01 of the Code of the District of Columbia.

Statutory conversion won’t dissolve your Washington, D.C., LLC unless the process is mismanaged due to a lack of legal oversight. Some non-attorney websites also incorrectly claim that dissolution is one of the required steps in the conversion process. This is not the case, as filing to dissolve your LLC will only lead to its dissolution.

The Internal Revenue Service (IRS) evaluates the circumstances of each individual business that changes its place of formation to determine whether they will be allowed to continue using the same EIN. Generally, maintaining your business’s continuity while it’s converted from a Washington, D.C., LLC to a Florida LLC is one of the most important factors here. It’s also important that nothing is changed about your business’s identity other than its new status as a Florida entity.

The statutory conversion process always involves a core set of procedures that must be executed, but each has its own specific requirements and peculiarities to account for depending on the jurisdictions involved and the business itself. Below, we have a general outline of how we address those core procedures, not instructions for converting a Washington, D.C., LLC to a Florida LLC. If you’re in search of that kind of reliable and experienced legal guidance, schedule your initial consultation with Attorney Patel now.

After we’ve been hired for a client’s conversion or domestication project, we first host an initial interview with them and perform a comprehensive review of their business. In addition to gathering information relevant to the business’s transition from a Washington, D.C., LLC to a Florida LLC, it also helps us confirm that it’s eligible to undergo this process. We then take what we’ve learned and use it to create a personalized plan to convert their business into a Florida entity that preserves its continuity and corporate identity.

Enlisting our firm to convert a Washington, D.C., LLC to a Florida LLC allows you to benefit from services informed by years of experience that include:

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

While not every law firm is able to make such claims, our legal team can convert a Washington, D.C., LLC to a Florida LLC as quickly as possible thanks to our wealth of experience handling these types of transitions. For most of our clients, this will work out to about two or three months, but more time might be needed depending on the company’s size and assets.

The agencies in Washington, D.C., and Florida responsible for your paperwork will need at least several weeks of processing time. They often face delays due to backlogs, short staffing, and other issues as well. One side effect of this is that any mistakes with your documents that require corrections could lead to significant delays on your end as well. These mistakes are much more likely to occur if you’re not working with an attorney or lack experience with these transitions yourself.

Like many other aspects of the conversion process, every jurisdiction is in charge of setting their own filing fees for the different documents involved. Washington, D.C., charges $220.00 and Florida charges $155.00, so the total costs for your initial filings will start at $375.00. Be mindful that, in addition to the other expenses necessary to move your company, mistakes can also hurt your company’s bottom line as well, especially if they lead to fines or other legal problems.

We provide flat fees for our conversion services based on the complexity of that particular move, which is another way that we keep costs low for our clients. Schedule your initial consultation now to review your project and get a quote to convert a Washington, D.C., LLC to a Florida LLC.

A safe and successful statutory conversion requires a lot more than making a few filings after some light research online. An attorney’s assistance is the best way to prevent the kinds of costly mistakes that could cause long term damage to both your business and its owners when converting a Washington, D.C., LLC to a Florida LLC.

Without legal guidance during your business’s conversion from a Washington, D.C., LLC to a Florida, LLC, it’s far more likely that you’ll encounter problems that include:

• Legal noncompliance
• 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 Washington, D.C., 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 as you move forward that these are only some of the dangers involved with an improperly handled conversion.

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 Washington, D.C., LLC to a Florida LLC.

Taking on this project yourself increases the chances of a failed conversion and all the consequences that can come with it. Working with our law firm allows you to benefit from our years of experience, which we use to help ensure that everything runs smoothly when converting your business into a Florida entity.

1. Your filing responsibilities in Washington, D.C., will be eliminated if your LLC no longer has a nexus there after converting into a Florida entity.

2. Converting a Washington, D.C., LLC to a Florida LLC means that your company can benefit from the skills of Florida professional accounts, attorneys, and other important service providers.

3. There won’t be any interruptions to your company’s continuity or its ability to do business when you use statutory conversion to relocate it from Washington, D.C., to Florida.

4. Florida Articles of Organization will automatically and seamlessly replace your LLC’s original formation documents upon their filing. This allows the Florida LLC to keep the same powers, rights, benefits, exemptions, privileges, and principles that it had as a Washington, D.C., LLC.

5. The owner’s membership interest in their company won’t be changed when they convert a Washington, D.C., LLC to a Florida LLC. Real estate and other property rights will be similarly maintained. Liabilities and lawsuits will also follow the company to Florida during this transition, although the name of the Florida LLC may be used in place of the initial Washington, D.C., LLC.

6. Members of the converting LLC aren’t required to live in Florida.

7. Changing your business into a Florida LLC means that there won’t be any need to continue having a nexus (taxable connection) in Washington, D.C. This can lead to a lower tax burden at the state level, although federal responsibilities will continue to apply. Check with your tax advisor for help with the tax implications of converting a Washington, D.C., LLC to a Florida LLC, as the specifics will be different for each company.

8. Conversion allows you to continue using the same EIN for your business after its transition from a Washington, D.C., to a Florida LLC. The converted LLC is the same entity that existed before, just with a new legal state of formation.

9. Another way that statutory conversion can make your company’s relocation to Florida easier is that it lets your LLC keep using the same bank accounts, taxpayer ID, operations, and contracts, too. However, careful planning will be required to ensure that this is the case.

Converting a Washington, D.C., LLC to a Florida LLC will likely come with some changes to how the entity is taxed due to the different tax laws in each jurisdiction. While we can give some limited information on these subjects, consulting with your tax professional is critical to successfully navigating the various implications of your company’s move. A few common topics that you might want to discuss with them could include:

• State Income Tax: Florida is one of the few states without its own income tax. Washington, D.C., on the other hand, issues its own income tax in addition to the one in place at the federal level. This is one way that many LLC owners are able to lower their expenses by converting their businesses into Florida entities.

• Franchise Tax: Another tax that Washington, D.C., businesses are subject to that isn’t imposed by the State of Florida is franchise tax. The LLC will need to close its account with the Washington, D.C., Office of Tax and Revenue and file final returns if required.

• Nexus: Your LLC will need to obey the tax laws of any jurisdiction where it has a nexus, even after its conversion from a Washington, D.C., LLC to a Florida LLC. Also known as a taxable connection, a nexus is usually created when a business has a physical presence, substantial activities, or employees in a specific state or district.

Converting a Washington, D.C., LLC to a Florida LLC with our oversight allows you to benefit from Attorney Patel’s years of experience as both a lawyer and an entrepreneur himself. In addition to assisting our clients with conversions and domestications, you should keep in mind that our law firm offers many other business and legal services that can help your LLC reach its full potential in the State of Florida.

Once our client’s business has been officially converted from a Washington, D.C., LLC to a Florida LLC, Attorney Patel hosts a final consultation so that he can answer any questions that still remain about the company’s transition. During this meeting, they also receive a post-conversion checklist that contains useful instructions to help guide them through some of their new responsibilities as Florida LLC owners.

The consequences of mistakes and mismanagement when converting a Washington, D.C., LLC to a Florida LLC should be avoided by any means necessary. By trusting your conversion 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 of its relocation. Schedule with us and get started today.

Is your Washington, D.C., LLC ready for a new start on the east coast? Don’t risk breaking your business’s stride by attempting to convert a Washington, D.C., LLC to a Florida LLC on your own — get assistance from an experienced business conversion attorney by scheduling online or calling (727) 279-5037.

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