Can You Domesticate a Massachusetts Corporation in Florida?
Domesticating a Massachusetts C or S Corporation to Florida
While there are many avenues available to corporations interested in relocating to Florida, the method that our firm likes to recommend whenever it’s available is known as domestication. This is a statutory process that allows eligible businesses to update their formation state. If you’re interested in moving your business here to take advantage of our pro-business community or just our beautiful climate, then domestication is the way to do it — if your corporation qualifies.
What Happens to My Massachusetts Corporation During Domestication?
Domestication is an ideal way to relocate a corporation because it preserves the business’s continuity. This means that you can keep doing business during the move, and it does away with any need to dissolve and reincorporate your business, too. The domesticated corporation will be the same entity that you had back in Massachusetts. The only real difference now is that it will be treated as if it had formed in Florida from the start.
Bringing your corporation to Florida via domestication allows your business to retain its original EIN, incorporation date, and ownership structure. All real estate, property, and contractual rights will also transfer over during the move. You might, however, need to find a new name for your business if the one used in Massachusetts is already in use by a Florida entity. You can beck by performing a name availability search using the Florida Division of Corporation’s website.
What are the Effects of Domestication?
The domestication process will have a minimal impact on your corporation aside from amending its formation state. The shareholder’s rights, such as the right to buy new shares, are preserved during the move by the conversion’s terms, the FBCA, and the relevant formation documents. Ownership in the company will remain unchanged, as will the value of the corporation’s stock, eligible interests, and securities. Lawsuits, debts, liabilities, obligations, and other proceedings will also carry over from the Massachusetts corporation to the domesticated Florida corporation.
Does My Massachusetts Corporation Dissolve When It Domesticates to Florida?
No, your Massachusetts corporation won’t be dissolved when domesticating to Florida. However, it won’t be able to do business in Massachusetts any longer unless it files a foreign qualification first.
How Long Does It Take to Relocate My Business From Massachusetts to Florida?
Most Massachusetts corporations without a lot of real estate can expect to domesticate to Florida within four to twelve weeks. A more exact estimate can be provided by your attorney after they have had the opportunity to review your business and its assets.
How Do I Domesticate My Massachusetts C or S Corporation?
A Plan of Domestication is the first thing that your Massachusetts corporation will need in order to domesticate to Florida. This document is exactly what it sounds like — an outline of how the domestication will take place. It needs to reference the authorizing state statutes, anticipated tax consequences, company ownership, and the transfer of rights and obligations. Once the directors and shareholders approve the plan, you can file the remaining paperwork called for by state agencies in both Massachusetts and Florida.
Should I Use FL Patel Law to Domesticate My Massachusetts Corporation?
Yes! We’ve helped businesses from across the country relocate to Florida, which has resulted in a fine-tuned process that helps ensure that your domestication takes place without any headaches or interruptions. Our firm is more than happy to offer legal support after your move, too, if you need help navigating your new state’s laws and regulations.
Corporate transactions often come with legal and tax implications. Mistakes during the domestication process could cause you to lose liability protection, discourage potential investors, or even the liquidation of your company. It’s always worth the effort to find a qualified lawyer to assist you.
Does Florida Permit the Domestication of Massachusetts Corporations?
Under Florida law, corporations can only domesticate if their current state of formation has similar laws authorizing the move. LLCs face similar standards for converting to Florida. A full list of the conditions can be found in Section 607.0101 of the Florida Business Corporation Act (FBCA). Review this section very carefully. Mistakes here could cause dissolution.
Does Massachusetts Allow Corporations to Domesticate or Move to Florida?
Yes, according to Mass. Gen. Laws Ann. ch. 156D, § 9.20.
(b) A domestic business corporation may become a foreign business corporation only if the domestication is permitted by the laws of the foreign jurisdiction. Regardless of whether the laws of the foreign jurisdiction require the adoption of a plan of domestication, the domestication shall be approved by the adoption by the corporation of a plan of domestication in the manner provided in this subdivision. The laws of the foreign jurisdiction shall govern the effect of domesticating in that jurisdiction.Mass. Gen. Laws Ann. ch. 156D, § 9.20
Are you ready to move your Massachusetts corporation down the coast to sunny and beautiful Florida? Don’t risk breaking your business’s stride– get assistance from an experienced business domestication attorney by calling (727) 279-5037, or if you are ready to move, schedule a consultation online today.
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