Can You Move, Convert, or Domesticate a Massachusetts Corporation into a Florida Corporation?

Relocate, Convert, or Domesticate a Massachusetts Corporation into a Florida Corporation

Updated: December 21, 2023
Reading Time: 10 Minutes

Objectives:

• Domicile a Massachusetts corporation to Florida;
• Keep the same EIN and corporate identity; and
• Enjoy tax benefits provided to Florida residents.

Entities:

• Massachusetts corporations

Table of Contents

• What is a Domestication, Conversion, or Transfer?
• Can Massachusetts C or S Corporations Move to Another State?
• Will This Dissolve My Massachusetts C or S Corporation?
• Do I Need to Get a New EIN After Domesticating My C or S Corporation to Florida?
• How Can FL Patel Law PLLC Help Domesticate a Massachusetts Corporation to Florida?
• How Long Will It Take for FL Patel Law PLLC to Domesticate a Massachusetts C or S Corporation?
• How Much Does it Cost to Domesticate a Massachusetts Corporation to Florida?
• What Are Some of the Dangers of Domesticating a C or S Corporation Without an Attorney’s Assistance?
• Make Your Domestication More Convenient and Secure with FL Patel Law PLLC
• What Are the Benefits of Domesticating a Massachusetts C or S Corporation to Florida?
• What Tax Implications Can I Expect if I Domesticate a Massachusetts Corporation to Florida?
• Should I Hire FL Patel Law PLLC to Domesticate My Massachusetts C or S Corporation?

As of 2023, Massachusetts law allows the state’s domestic corporations to undergo a popular legal procedure known as domestication. Domestication can be used to move a company from one state to another by officially changing its state of formation. Keep on reading for how you can domesticate a Massachusetts corporation to Florida and benefit from the many different advantages that our state offers business owners.

There are many risks involved with a transition as complex as domesticating a corporation from one state to another. FL Patel Law PLLC’s experience means that we’re well equipped to help your company safely relocate across state lines. Our firm has successfully reorganized over 140 businesses into Florida entities, which is why you can trust us to have the knowledge and expertise needed to successfully domesticate a Massachusetts corporation to Florida.

We created this page to introduce our clients to the steps we take when relocating their company to Florida through domestication, as well as how our process can save your corporation time and money while also ensuring its safety. It will also go over some of the risks associated with trying to change a Massachusetts corporation into a Florida corporation without an attorney’s assistance, plus how our legal team can help you avoid other potential complications.

Every state has its own unique requirements for relocating a company from one state to another. The consequences for your mistakes can range from fines to the liquidation of your business. Working with an attorney to domesticate a Massachusetts corporation to Florida is vital to securing the future of your business.

Domestication is a legal process for changing a Massachusetts corporation into a Florida corporation.

This transition is also commonly known as a “conversion” or “transfer” when the company is moved to a new state. These terms can often be used interchangeably.

Because the resulting Florida entity is still considered to be the same business that existed back in its original formation state, all of the Massachusetts entity’s rights, assets, privileges, and principles will automatically transfer to the Florida C or S corporation. This is also true in the case of any liabilities or lawsuits against the domesticating entity.

After it has officially become a Florida corporation, the Florida Business Corporation Act (FBCA) will become your business’s governing law. That said, it might still fall under the authority of the Massachusetts Business Corporation Act (MBCA) in some situations, such as if it has a nexus or foreign qualification in Massachusetts after its domestication. Remember to talk to our corporate attorney about this during your initial consultation.

As of 2023, Massachusetts corporations can domesticate and become entities in other states like Florida under Section 9.20 of the MBCA. Massachusetts LLCs, on the other hand, must undergo a reincorporation merger.

No, domesticating your company won’t lead to its dissolution. Dissolution isn’t a necessary part of this process, either, so you can ignore any websites saying otherwise. However, because certain mistakes with your company’s move to Florida could dissolve your Massachusetts corporation, working with an attorney is essential to protecting your business’s continuity.

In most cases, the Internal Revenue Service (IRS) allows companies to continue using their original EIN after relocating from one state to another as long as its continuity isn’t interrupted. Your C or S corporation’s formation state must also be the only thing about its corporate identity that changes when you domesticate a Massachusetts corporation to Florida, as the IRS will require your business to effectively be the same entity that it was before in order to keep using the same EIN.

The exact procedure for domesticating a corporation will vary depending on the states involved and other factors unique to that particular business. What follows is a general overview of some of the things we do to help our clients when changing a Massachusetts corporation into a Florida corporation. It should not be treated as instructions for conducting a transition from state to state. Schedule an initial consultation with our corporate attorney now for advice tailored to the specific needs of your company’s relocation.

When we’re hired to domesticate a Massachusetts corporation to Florida, we first review the business to ensure that it qualifies for this type of transition. At this stage we also gather the information that our legal team needs to create our strategy for relocating the company from Massachusetts to Florida.

The support and conveniences provided to our corporate relocation clients includes:

• Drafting all documents required to domesticate a Massachusetts corporation to Florida, including the Plan of Domestication;
• Ensuring compliance with the laws, regulations, and other legal requirements present in both Massachusetts and Florida;
• Handling all filings and correspondence with Massachusetts and Florida state agencies;
• Updating the C or S corporation’s bylaws and other corporate documents to reflect its domestication to Florida; and
• A final consultation at the end of the project where our corporate lawyer will answer any questions you have left about your company’s relocation.

While this will depend on the size of your company and its assets, we can complete most of our corporate relocation projects in about two or three months. Our firm has helped reorganize over 140 companies into Florida entities, giving us the experience and insight needed to make your move as stress-free and streamlined as possible.

Working with a law firm like ours is the best way to keep your company’s relocation on schedule. Otherwise, issues that you encounter while trying to domesticate a Massachusetts corporation to Florida could lead to delays and other problems that can hurt your business’s bottom line. The state agencies responsible for your documents also sometimes face delays of their own due to backlogs, short staffing, and other problems, so getting everything right on the first try is essential.

Massachusetts charges a $250.00 filing fee to process corporate domestication documents and Florida charges $128.75. This comes to a total of $378.75 just to have your paperwork processed, and doesn’t account for additional expenses associated with the move. Keep in mind that those costs will only go higher if you make any mistakes when you domesticate a Massachusetts corporation to Florida, too.

FL Patel Law PLLC’s clients receive flat fees for their corporate relocation projects based on the specific demands of the move itself. This helps keep costs low and makes it easier to stick to your company’s budget by preventing unexpected expenses and other problems. Schedule your consultation now to get a quote to domesticate a Massachusetts corporation to Florida.

Every state has its own unique requirements for relocating a business across state lines. This creates many opportunities for things to go wrong if you attempt a process as complex as a corporate domestication without an attorney’s guidance.

Attempting to domesticate a Massachusetts corporation to Florida without legal assistance can lead to consequences that include:

• Noncompliance with state laws
• Revocation of the Massachusetts C or S corporation’s operating authority
• Damaged credit standing
• Damaged relationships with clients and vendors
• Disrupted contracts
• Loss of continuity
• Piercing the corporate veil
• Loss of liability protections
• Tax implications and increased tax liabilities
• Legal disputes
• Dissolution or liquidation
• Missed opportunities
• Expensive fines
• Painful delays
• Taxes on Appreciated Assets – The gained value of your company’s appreciated assets could pass on to its shareholders if you make a mistake when domesticating it to Florida. In other words, if something that was valued at $500,000 when the business was incorporated is now valued at $5,000,000, then you and your fellow business owners could be responsible for that increase.
• Title of Asset Problems – Without us around to make sure that everything is done correctly, then your company’s asset titles might not automatically transfer over to your Florida entity. If that happens, it can be difficult or even impossible to prove that your C or S corporation owns those assets. In addition to other problems, this can be a major roadblock if you ever try to sell your business.

Despite its length, this is not a comprehensive list, so be sure to proceed with caution – or better yet, with the assistance of legal counsel – when you domesticate a Massachusetts corporation to Florida.

Our firm has helped reorganize over 140 companies into Florida entities. A track record of this caliber means that we know how to bring your company to Florida securely, efficiently, and with everyone’s interests protected at every stage of the project.

Working with our firm to domesticate a Massachusetts corporation to Florida won’t just do away with the stress and hassle of handling the project yourself – it’s an essential part of ensuring that your company’s relocation is successful in the first place. Our expertise can make all the difference when it comes to preserving your company’s continuity and corporate identity during its transition to Florida.

1. Your C or S corporation won’t need to file with the State of Massachusetts ever again if its domestication removes its taxable connection in its original formation state.

2. As a Florida business owner, you’ll be able to network and collaborate with Florida professional accountants, attorneys, and other service providers.

3. Working with our skilled attorney to domesticate a Massachusetts corporation to Florida allows for a smooth transition from state to state free from delays or other problems.

4. Your company’s newly drafted Florida Articles of Incorporation will automatically replace the C or S corporation’s original incorporation documents, which helps ensure your company’s continuity.

5. The number of shares issued by your corporation and the value of those shares won’t be changed when you domesticate a Massachusetts corporation to Florida. During this process, real estate and other property rights will automatically transfer to the Florida entity. This is also true for any liabilities or lawsuits faced by the corporation. The Florida corporation’s name may be substituted in place of the Massachusetts entity’s name for any pending legal procedures or actions.

6. Your C or S corporation’s directors and shareholders don’t need to live in Florida after its domestication.

7. Relocating your business to Florida could reduce the burden of state income taxes if your company’s nexus in Massachusetts is removed during the move. Check with your tax professional for more guidance on these matters, as the specifics will be unique to each business.

8. Domesticating a Massachusetts corporation to Florida allows it to continue using the same EIN. The only thing that will change about the business’s corporate identity is its formation state.

9. Another convenience offered by this process is that your domesticated entity can continue using the same bank accounts, the same taxpayer ID, the same operations, and the same contracts that it had in Massachusetts, too. However, careful planning should be undertaken to ensure that this is the case.

Another key component to any successful corporate domestication is preparing for the tax implications that the move will have for your company. Because our legal team can only give some limited guidance when it comes to tax matters, you’ll need to work with your tax professional to ensure compliance with the IRS and state agencies when you domesticate a Massachusetts corporation to Florida. Some things to discuss during your consultation with them might include:

• State Income Tax: Florida, unlike Massachusetts, has no state income tax, which could save some money for your company if it no longer has a nexus in its original state. This is one way that business owners often save money when they domesticate a Massachusetts corporation or similar entity to Florida. Federal requirements will, of course, still apply to your corporation after its move to Florida.

• Franchise Tax: Florida also has no franchise tax for corporations, either. Your C or S corporation will need to close any account with the Massachusetts Department of Revenue and file final returns if necessary.

• Nexus: Massachusetts tax laws could still apply to your company if it still has a nexus (taxable connection) in its original formation state even after you domesticate a a Massachusetts corporation to Florida. Nexus is generally established when a company has a physical presence, employees, or substantial activities in a particular state.

After we successfully domesticate a Massachusetts corporation to Florida, Attorney Patel holds a comprehensive consultation to address any remaining questions that our clients have about their project. They also receive a post-domestication checklist that helps familiarize them with their new responsibilities as Florida business owners.

As a corporate law firm, we offer a suite of services that are highly beneficial, if not necessary, to running a business in Florida. This means that we are fully equipped to support your business both during and after its relocation. Attorney Patel’s experience as both an entrepreneur has given him a rare level of insight into transactions like working to domesticate a Massachusetts corporation to Florida.

The potential dangers that can come with trying to domesticate a Massachusetts corporation to Florida should be averted at all costs. By trusting our Florida corporate law attorney with your company’s transition, you’ll have more time and energy to focus on running your business while we tackle the legal complexities of its move, too. Schedule with us now to get started.

Ready to embrace your business’s next chapter in beautiful Florida? Hire our corporate law firm to domesticate a Massachusetts corporation to Florida by calling (727) 279-5037 or by reserving a time using our online calendar.

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