Can You Relocate or Convert a Hawaii LLC to a Florida LLC?

Can You Relocate or Convert a Hawaii LLC to a Florida LLC?

Converting or Relocating a Hawaii LLC to Florida

While it might seem like you’re trading one set of world famous beaches for another, there are a lot of reasons for business owners, LLCs, and entrepreneurs to make the move from Hawaii to Florida through a statutory process known as a Conversion. For example, our State is pro-business in ways that are envied nationwide. To be eligible for conversion, both states must have laws on the books permitting such a transfer. For a complete list of the conditions required by Florida law, please see Chapter 605 of the Florida Revised Limited Liability Company Act.

What Happens in a Conversion? 

We like to recommend Statutory Conversions to our Clients who own LLCs and are interested in relocating their businesses to Florida. Conversions are a great option because they allow foreign LLCs, such as Hawaii LLCs, to become Florida LLCs without any costly interruptions to the business’s continuity. You won’t have to recreate your LLC from scratch, either. It’s the same business that it was when it first started out in Hawaii, just with a new principal location. After the conversion, however, the business will be treated as if it had been formed in Florida from the outset. Everything else remains unaltered, including your Federal Employer Identification Number (FEIN or EIN), management structure, and property rights. You will, however, need a new name for your LLC if the original one is already in use by a Florida entity. 

Does Hawaii Allow Domestic LLCs to Convert to Florida LLCs?

Yes! Hawaii LLCs can convert to Florida LLCs according to Haw. Rev. Stat. Ann. § 428-902.5.

(a) A domestic limited liability company may adopt a plan of conversion and convert to a foreign limited liability company or any other entity if: 

(1) The domestic limited liability company acts on and its members approve a plan of conversion in the manner prescribed by sections 428-904 to 428-906 and the conversion is treated as a merger to which the converting entity is a party and not the surviving entity; 

(2) The conversion is permitted by, and complies with, the laws of the state or country in which the converted entity is to be incorporated, formed, or organized; and the incorporation, formation, or organization of the converted entity complies with such laws; 

(3) At the time the conversion becomes effective, each member of the converting entity, unless otherwise agreed to by that member, owns an equity interest or other ownership interest in, and is a shareholder, partner, member, owner, or other security holder of, the converted entity; 

(4) The members of the domestic limited liability company shall not, as a result of the conversion, become personally liable without the members’ consent, for the liabilities or obligations of the converted entity; and 

(5) The converted entity is incorporated, formed, or organized as part of or pursuant to the plan of conversion. 

Haw. Rev. Stat. Ann. § 428-902.5.

How Do I Convert My Hawaii LLC to a Florida LLC?

Converting your Hawaii LLC into a Florida LLC via statutory conversion is an excellent way to transfer your business to the Sunshine State without having to deal with any troublesome interruptions to its continuity. First, you’ll need to submit a plan of conversion to the LLC’s Members. After the Members have approved the plan, it’s time to file the requisite paperwork with the respective agencies in both states. A word of warning, though: follow the exact steps as prescribed by the statutes of both Hawaii and Florida. Mistakes made during the conversion process can be disruptive and threaten your business’s continuity. 

What Are the Effects of Transferring my LLC from Hawaii to Florida?

The impact that the conversion process will have on your business is minimal. Your LLC will remain the same business entity that it was back in Hawaii, just with a new principal location. Real estate and other property rights held by the original LLC will transfer to the converted entity. The rights of the Members in Multi-Member LLCs will also remain the same, as will their interest in the company.

A statutory conversion will similarly transfer any liabilities, lawsuits, or other proceedings from the Hawaii LLC to the Florida LLC. However, the Florida LLC’s name may be substituted in for the sake of clarity. 

Should I Work with a Lawyer to Convert my LLC?

Mistakes during the conversion process could cause you to lose liability protection, discourage potential investors, or even the liquidation of your company.

Absolutely! Our firm already has experience helping both single and multi-member LLCs from across America convert into Florida LLCs. We have worked with all industries, including consultants, service businesses, e-commerce businesses, and start-ups in relocating to the state of Florida.

Are you ready to give your Hawaii LLC a beautiful new home in Florida? Don’t risk breaking your business’s stride– get assistance from an experienced business conversion attorney by calling(727) 279-5037, or if you are ready to convert, check out our service page.

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FL Patel Law PLLC is a boutique business law firm dedicated to entrepreneurs and companies.

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