Can You Relocate or Convert an Iowa LLC to a Florida LLC Without an Attorney?

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

Updated: August 15, 2023
Reading Time: 10 Minutes

Objectives:

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

Entities:

• Iowa Limited Liability Companies (LLCs)

Table of Contents

• What is a Conversion or Domestication?
• Does Iowa Allow LLCs to Move Out of State
• Is My Iowa 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 Iowa 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 Iowa 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 Iowa LLC to a Florida LLC?
• What Are the Tax Implications of Converting My Iowa LLC to a Florida LLC?
• Should I Work With Attorney Patel to Convert My Iowa LLC to a Florida LLC?

Moving an LLC from Iowa to LLC can be appealing for a lot of reasons. These range from Florida’s lack of a state income tax to our world-class beaches. We have many other pro-business policies that your company could benefit from too. Those interested in making this type of move can do so thanks to a process known as statutory conversion.

Converting an Iowa LLC to a Florida LLC is a significant undertaking that can expose both your LLC and its members to great risk, but FL Patel Law PLLC’s legal 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 set them up for success after their move.

This article was written to help our future clients obtain a better understanding of the many advantages of hiring our firm to convert their Iowa LLC to a Florida LLC, such as how working with us can actually save your company time and money in the long run. It also has some information about the risks posed to both your LLC and its members if you try to take on a project like this without an attorney’s oversight.

Mistakes made during the conversion process carry consequences that can follow you and your business far into the future. These dangers include everything from simple fines to your LLC’s dissolution. Our legal team is equipped with the skills, experience, and knowledge needed to safely convert your Iowa LLC to a Florida LLC while also ensuring legal and tax compliance.

An eligible LLC can change its formation state by utilizing a legal process known as statutory conversion.

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

Converting an Iowa LLC to a Florida LLC allows the business to maintain its identity while also protecting its continuity, which wouldn’t be the case if the company had to dissolve and reform in its newly chosen domicile. This can help the company preserve important relationships, contracts, and licenses. The Iowa LLC’s rights, assets, privileges, and liabilities will also be transferred over to the converted entity.

The Florida Revised Limited Liability Company Act will start applying to your business after its conversion into a Florida LLC. However, there are some situations where your converted entity will need to continue following the Iowa Revised Uniform Limited Liability Company Act, such as if the company has a foreign qualification or nexus in Iowa. This is a topic to bring up during your consultation with our attorney.

You can convert an Iowa LLC to a Florida LLC according to Section 489.1010 of the Iowa Revised Uniform Limited Liability Company Act. Iowa corporations, on the other hand, can use domestication to become Florida corporations.

Dissolution is not a part of converting an Iowa LLC to a Florida LLC, despite what some misleading sources on the internet might say. Your company won’t be dissolved at any point during this process unless mistakes are made along the way. With an attorney overseeing your company’s relocation, you can worry less about these kinds of problems derailing your conversion or throwing your business out of continuity.

The Internal Revenue Service (IRS) determines this based on the specific circumstances of each business’s move. Two of the most important things they consider are whether any changes have been made to your LLC other than its new domicile and whether your company’s continuity has been interrupted. If keeping your LLC’s original EIN is important to you, then a law firm like ours can be a great resource.

Although each conversion has its own unique set of requirements based on the business’s circumstances and the different states involved, there are some common steps that they all share. What follows is only a general overview and should not be treated as instructions for moving an LLC from one state to another. Schedule your consultation now for legal guidance specific to converting your Iowa LLC to a Florida LLC.

First, we confirm the LLC’s eligibility for statutory conversion and gather the information that we need to make that move happen. We also review the client’s LLC and conduct an initial consultation so that we can better understand their goals for relocating their company. This allows us to draft a personalized plan for converting the Iowa LLC to a Florida LLC that prevents delays, noncompliance, and other potential problems.

FL Patel Law PLLC’s comprehensive conversion services include:

• 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 Iowa and Florida state agencies
• Updating the LLC’s operating agreement and other corporate documents to reflect its conversion from an Iowa LLC to a Florida LLC
• A conclusive consultation to address final concerns and questions

Our legal team can help keep your company’s conversion from an Iowa LLC to a Florida LLC on schedule by ensuring that its relocation happens on the fastest possible timeline. For most businesses, this works out to about two or three months. Larger entities with more assets, however, may require more time. Beware that even small mistakes with your documents can set your project back significantly.

State agencies in both Iowa and Florida will need several weeks each to go over your documents, and often face delays of their own because of short staffing, backlogs, and other reasons. That’s why it’s crucial to work with an attorney who can help minimize the risk of errors that could require repeated filings which almost inevitably lead to delays.

Iowa’s $50.00 fee for conversion documents, when combined with Florida’s $155.00 filing fee, comes to a total of $205.00 just to have your paperwork processed. In addition to other costs needed to relocate your company’s operations to Florida, any mistakes you make are likely to drive your costs even higher. In this sense, working with an attorney can be a valuable investment if you want to save money in the long run.

We provide flat fees for conversion projects based on the unique needs of the client and the move itself. Schedule your initial consultation now to get a quote for converting your Iowa LLC to a Florida LLC.

Converting an Iowa LLC to a Florida LLC requires a strong understanding of the laws in each state and a deep familiarity with the process itself if you want to avoid the kinds of problems that can threaten your business’s future. Our attorney’s assistance can go a long way in avoiding these kinds of costly mistakes and more.

Some of the dangers that you and your LLC can be exposed to if you don’t have the right legal guidance 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 an Iowa 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.

Despite its length, beware that the above list is not complete. There are still more ways that things can go wrong if you don’t have experience with this type of transition.

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 Iowa LLC to a Florida LLC.

Don’t leave the conversion of your Iowa LLC to a Florida LLC up to change. Secure your transition from state to state by working with a firm with experience relocating companies from all across the country to Florida.

1. If your business no longer has a nexus in Iowa after converting into a Florida LLC, then it will never have to file with the State of Iowa again.

2. Converting an Iowa LLC to a Florida LLC lets you work with Florida professional accountants, attorneys, and other important service providers.

3. Working with our firm can help ensure a seamless and uninterrupted transition from Iowa to Florida.

4. Your LLC’s original formation documents will be automatically replaced by Florida Articles of Organization, ensuring that the LLC retains all of its powers, rights, benefits, exemptions, privileges, and principles.

5. All of the LLC’s owners will have the same membership interest in the company after its conversion. Real estate and other property rights will also transfer to the Florida LLC during this process. 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 can be substituted with the name of the Florida LLC.

6. The LLC’s members don’t have to live in Florida after moving their company.

7. Your Florida LLC isn’t required to have a taxable connection (nexus) in Iowa, which could allow it to save money on state income taxes and/or other LLC taxes in your previous state. Check with your tax professional for more guidance on taxes, as tax implications will vary from business to business.

8. Your LLC can continue using the same EIN after its conversion. It will continue to exist and report taxes as it always did, with only its domicile changing.

9. Converting your Iowa LLC into a Florida LLC also means that it can keep using the same bank accounts, the same taxpayer ID, the same operations, and the same contracts, too. Depending on the size and complexity of the business, careful planning should be undertaken before engaging in domestication or conversion.

A transition as big as taking your business to a new state will almost certainly have some tax implications. Preparing for these changes is an essential part of converting an Iowa LLC to a Florida LLC. However, because we can only give limited guidance in these areas, it’s essential that you consult with your chosen tax professional to ensure compliance. Some potential things to bring up with them are:

• State Income Tax: Florida is well known for not having a state income tax. Although you’ll still need to satisfy your federal responsibilities, this is one way that your company could save money by converting from an Iowa LLC to a Florida LLC.

• Franchise Tax: Florida doesn’t have a franchise tax for LLCs, either. The LLC will need to close its account with the Iowa Department of Revenue and file final returns if required.

• Nexus: An LLC has to follow the tax laws of any state that it has a nexus (taxable connection) in, regardless of its official formation state. Nexus is usually established if a company has a physical presence, employees, or substantial activities in a given state.

We wrap up our conversion projects with a final consultation that allows our clients to ask Attorney Patel any remaining questions that they have about their company’s relocation. They also receive a helpful checklist with instructions to help them adapt to their new responsibilities as Florida LLC owners.

As both a lawyer and an entrepreneur himself, Attorney Patel’s background gives him significant insight into the various business and legal matters faced by our clients. Remember that, as a corporate law firm, we offer a wide variety of services designed to make life easier for Florida business owners.

Trying to convert an Iowa LLC to a Florida LLC without legal guidance places everyone involved in unnecessary danger. By trusting your relocation to our Florida conversion 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.

Ready to convert your Iowa 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 through our online calendar.

Image Source: Iowa Red Barn American Flag Wood by 12019 from Pixabay.