Can My Company Domesticate or Convert from an Indiana LLC to a Florida LLC?
Relocating, Domiciling, Transferring, or Converting an Indiana LLC to a Florida LLC
Updated: July 12, 2023
Reading Time: 10 Minutes
- Domicile an Indiana Limited Liability Company (LLC) to Florida;
- Maintain the same EIN and identity of the LLC;
- Enjoy tax benefits provided to Florida residents.
- Limited Liability Companies (LLCs)
Table of Contents
- What is a Conversion or Domestication?
- Does Indiana Allow LLCs to Move Out of State?
- Is My Indiana 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 Indiana 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 Indiana 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 Indiana LLC to a Florida LLC?
- What Are the Tax Implications of Converting My Indiana LLC to a Florida LLC?
- Should I Work With Attorney Patel to Convert My Indiana LLC to a Florida LLC?
If you’re looking to move your LLC from Indiana to Florida, then you’re in good company. Businesses from across the nation have been rushing to relocate to Florida in recent years. Whether it’s our lack of a state income tax or one of our many other pro-business policies, there are plenty of benefits for doing so. This kind of move can be made by undertaking a legal transaction known as statutory conversion.
Converting an Indiana LLC to a Florida LLC can seem overwhelming, 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 article will go over what our firm does to convert an Indiana LLC to a Florida LLC, plus some of the ways that our legal team can save your company time and money while also heading off potential risks. It also has some important warnings about what could go wrong for you and your business if you attempt a transition as substantial as this one without an attorney’s help.
Mistakes during the conversion process can lead to severe consequences for all involved, up to and including the liquidation of your LLC. However, our firm is well equipped to help guide our clients through their conversion without delays, interruptions, or other complications while ensuring legal and tax compliance, too. An attorney’s assistance with this transition is a truly invaluable asset.
What is a Conversion or a Domestication?To top
Statutory conversion is a method that LLCs can use to change their state of origin or formation. For example, it can be used to change an Indiana LLC to a Florida LLC while preserving the rest of the business’s identity.
This process is often referred to as “domestication,” “conversion,” or “transfer” when the entity is converting to a different state. These terms are often used interchangeably.
Conversion offers many advantages, especially when compared with the stress, hassle, and expenses involved with dissolving a business and restarting in a new state from scratch. For one, this process minimizes disruptions to the LLC’s ability to transact business and helps it keep important relationships, contracts, and licenses. The LLC’s original rights, assets, privileges, and liabilities will similarly transfer over to the converted entity, which can be a big convenience.
The Indiana Code will be replaced by the Florida Revised Limited Liability Company Act as the company’s governing law after it converts from an Indiana LLC to a Florida LLC. That said, both laws might actually apply to your business if it has a foreign qualification or nexus back in Indiana after relocating. Talk to our attorney about this during your consultation.
Does Indiana Allow Limited Liability Companies (LLCs) to Move Out of State?To top
Yes, the Indiana Code allows the conversion of an Indiana LLC to a Florida LLC under Section 23-0.6-4-1. Indiana corporations looking to become Florida corporations have a similar method available to them, which you can read about by clicking this link.
IC 23-0.6-4-1 Authorization of conversion; limitations on use
Sec. 1. (a) Except as otherwise provided in this section, by complying with this article or other law, a domestic entity may become:
(1) a domestic entity of a different type; or
(2) a foreign entity of a different type, if the conversion is authorized by the law of the foreign jurisdiction.
Is My Indiana Entity Dissolved?To top
No – your company will still be the same company that existed before you converted your Indiana LLC to a Florida LLC, just with a new domicile. An unfortunate number of online articles claim that an LLC needs to be dissolved to relocate to a new state, but this simply isn’t true and would actually negate many of the process’s benefits. Dissolution leads to liquidation and should only be initiated when it’s time to close your business.
Do I Need To Get a New EIN if I Domesticate My Company to Florida?To top
Most companies that keep their continuity intact when converting to a new state can keep using their original EIN. The business’s corporate identity must stay the same, too. However, the Internal Revenue Service (IRS) is in charge of this and ultimately decides on a situational basis. Working with a firm as experienced as our own can go a long way towards retaining your LLC’s original EIN when converting from an Indiana LLC to a Florida LLC.
How Does FL Patel Law PLLC Convert My Indiana LLC to a Florida LLC?To top
The necessary steps to convert or relocate a business to a new state will depend on the specific states involved. However, there are some parts of the process that they all have in common. What follows is a general overview of the conversion process and not instructions or advice for your business’s move. Schedule a consultation with our attorney now for your guidance related to your company’s unique circumstances.
Before we start on any of the paperwork needed for the conversion, we first conduct a review of the client’s LLC, which serves several purposes. First, it lets us confirm whether the business is eligible for statutory conversion at all. The information gathered during this review is also used to create a personalized strategy for relocating the company to Florida.
We provide comprehensive support throughout the conversion process that 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 Indiana and Florida state agencies
- Updating the LLC’s operating agreement and other corporate documents to reflect its conversion from an Indiana LLC to a Florida LLC
- An exit consultation to address final concerns and questions
How Long Does It Take To Complete a Domestication or Conversion to the State of Florida?To top
Our firm has used our expertise and insight to create a process for relocating companies to Florida in about two or three months. This is the fastest possible completion time for this project, and this expediency is due in no small part to our legal team’s extensive knowledge and experience with these transitions.
A lot of this time will be waiting on state agencies in Florida and Indiana. Each will likely need several weeks of processing time, as these agencies frequently have to deal with short staffing, backlogs, and other issues. Errors with your paperwork will only draw out this timeline and further delay your company’s move, so it’s critical that everything is done right the first time around. The good news is that an attorney can be a great help with this.
What Are the Costs Involved in Domesticating My Indiana LLC to the State of Florida?To top
The first expense required to convert an Indiana LLC to a Florida LLC will be the filing fees charged by each state. The State of Indiana charges $30.00 and The State of Florida charges $155.00, which comes to a total of $185.00. If you attempt this transition without an attorney’s oversight, keep in mind that you will likely need to pay these fees all over again for every mistake you make with your company’s conversion documents. Fines could even be involved if you do something to knock your company out of compliance.
The flat fees that we provide for conversion and domestication projects make it easier for our clients to set their budgets for their relocations. It also means that they don’t have to worry about unexpected expenses, either. Our flat fees are calculated based on the client’s business and the complexity of their move. Schedule an initial consultation with our attorney now to review your project and get a quote.
What Are Some of the Risks Associated With a Conversion Gone Wrong?To top
There are many ways that a conversion can end in failure without a great attention to detail and a deep understanding of the different laws in both Florida and Indiana. Hiring our firm to convert your Indiana LLC to a Florida LLC means that you don’t have to worry about making the kinds of costly mistakes that could threaten your business’s very existence.
Some of the dangers of attempting a project as substantial as converting a business to a new state without an attorney’s help 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 Indiana 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 list is not complete – these are only some of the problems that can come about from a failed 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 Indiana LLC to a Florida LLC.
Increase Your Chances of a Successful ConversionTo top
Without legal assistance or guidance, there are many ways that your company’s conversion or domestication can go wrong. Teaming up with us is the best way to ensure that everything goes according to plan when converting an Indiana LLC to a Florida LLC.
What Are the Benefits of Converting My Indiana LLC to a Florida LLC?To top
1. Relocating to Florida means that you could avoid filing with the State of Indiana ever again if the move removes your company’s nexus in that state.
2. Converting an Indiana LLC to a Florida LLC allows you to collaborate with Florida professional accountants, attorneys, and other service providers who have skills that can complement your own.
3. Your business will experience a smooth transition with no interruptions when converting from an Indiana LLC to a Florida LLC.
4. Florida Articles of Organization will immediately replace the LLC’s original founding documents upon filing. All LLC powers remain LLC powers, along with rights, benefits, exemptions, privileges, and principles.
5. Converting an Indiana LLC to a Florida LLC lets its owners keep their initial membership interest. 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 will be substituted with the name of the Florida LLC.
6. After converting the Indiana LLC to a Florida LLC, its members have no obligation to live in Florida.
7. Your converted Florida LLC will no longer need to have a taxable connection (nexus) in Indiana, which could lower what your company pays on state income taxes and/or other taxes in your old state. Check with your tax professional for more guidance on taxes, as it is unique to each business.
8. Your LLC’s EIN will stay the same when domesticating to Florida, as the converted entity is the same business that existed before. All that changes is its domicile.
9. Domesticating an LLC to Florida using statutory conversion allows the business to keep the same bank accounts, the same taxpayer ID, the same operations, and the same contracts. Depending on the size and complexity of the business, careful planning should be undertaken before engaging in domestication or conversion.
What Are the Tax Implications of Converting My Indiana LLC to a Florida LLC?To top
While the specifics will vary from business to business, you should be sure to prepare ahead of time for any tax implications that will result from converting your Indiana LLC to a Florida LLC. Our firm can only offer general guidance with these changes, so it’s essential to discuss this matter with your chosen tax professional for more. A few items to bring up in your discussion with them include:
- State Income Tax: Unlike Indiana – and most other states, for that matter – Florida has no state income tax. In other words, converting your Indiana LLC to a Florida LLC could reduce what your company pays on state income taxes. Federal income tax requirements, of course, must still be satisfied.
- Franchise Tax: Franchise tax is another burden faced in states like Indiana but not in Florida. The LLC should close any account with the Indiana Department of Revenue and file final returns if necessary.
- Nexus: Indiana’s tax laws could still apply to your LLC even after it converts into a Florida entity if it still has a nexus there. Nexus is generally established when a company has a physical presence, employees, or substantial activities in a given state.
Should I Work With Attorney Patel to Convert My Indiana LLC to a Florida LLC?To top
As a corporate law firm, we offer a suite of services to support our clients that could prove useful, if not necessary, to businesses relocating to Florida from another state. This is true both during and after their company’s conversion, as Attorney Patel’s proficiencies cover a wide range of practice areas.
Once our team has finished converting the Indiana LLC to a Florida LLC, Attorney Patel hosts a comprehensive consultation that gives our clients an opportunity to ask any remaining questions they have about their company’s new life in Florida. They also receive a post conversion checklist and instructions to help them adapt to their new responsibilities as Florida business owners.
The risks posed to both your LLC and its members should be underestimated at your own peril, as the consequences can be serious. 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.
Are you ready to move your Indiana LLC from the Midwest down to sunny and beautiful Florida? Don’t risk breaking your business’s stride — get assistance from an experienced business conversion attorney by calling (727) 279-5037 or by scheduling an appointment through our online calendar.