Can You Domesticate or Merge a South Carolina Corporation into a Florida Corporation?

Relocating, Domesticating, or Merging a South Carolina Corporation into a Florida Corporation

Updated: February 12, 2024
Reading Time: 10 Minutes

Objectives:

• Domicile a South Carolina C or S Corporation to Florida;
• Keep the same EIN and corporate identity; and
• Enjoy tax benefits provided to Florida residents.

Entities:

• South Carolina C or S Corporations

Table of Contents

• What is a Reincorporation Merger?
• Can South Carolina C or S Corporations Move to Another State?
• Will This Dissolve My South Carolina C or S Corporation?
• Do I Need to Get a New EIN After Relocating My C or S Corporation to Florida?
• How Does FL Patel Law PLLC Merge My South Carolina Corporation into a Florida Corporation?
• How Long Will It Take for FL Patel Law PLLC to Relocate a South Carolina C or S Corporation to Florida?
• How Much Does it Cost to Merge a South Carolina Corporation into a Florida Corporation?
• What Are Some of the Dangers of Merging Corporations Without an Attorney’s Assistance?
• Make Your Corporation’s Move More Convenient and Secure with FL Patel Law PLLC
• What Are the Benefits of Moving a South Carolina C or S Corporation to Florida?
• What Tax Implications Can I Expect from Merging a South Carolina Corporation into a Florida Corporation?
• Should I Work With Attorney Patel to Merge My South Carolina Corporation into a Florida Corporation?

Many of our clients approach us for help with relocating a corporation to Florida from out of state, but they sometimes come from states like South Carolina that don’t allow for methods like statutory conversion or domestication. Under these conditions, we like to use a process known as a “reincorporation merger” to help them make their move into a reality.

The various complexities and complications involved with merging a South Carolina corporation into a Florida corporation can present many risks to business owners who attempt this transfer without an attorney’s assistance. FL Patel Law PLLC has successfully reorganized over 140 businesses into Florida entities, which is why you can trust us to have the knowledge and expertise needed to manage your South Carolina C or S corporation’s relocation.

This page will go over our firm’s refined process for relocating a corporation to Florida from out of state, as well as how that process can even save our clients time and money. It also has some important warnings about the dangers that you and your company could be exposed to if you move forward without hiring a lawyer.

The damage that can result from a mismanaged reincorporation merger can even include the accidental dissolution of your South Carolina corporation. Some of these dangers can impact the company’s owners in addition to harming the company itself, too. Having an attorney help you navigate this process means that you don’t need to worry about making the kinds of errors that could harm your company, if not end it altogether.

Reincorporation mergers allow corporations to move from one state to another when statutory conversion or domestication isn’t an option. This is done by creating a corporation in the destination state that the existing entity will merge into, which helps preserve continuity.

This type of reorganization, when properly managed, won’t change anything about the business’s corporate identity other than its formation state. This is useful for maintaining important relationships, contracts, and licenses that your entity will need after merging a South Carolina corporation into a Florida corporation.

The South Carolina corporation’s rights, assets, privileges, and principles will also carry over to the merged Florida entity, as will any pending lawsuits or liabilities. The resulting entity’s name may replace the original entity’s name for the purposes of these legal proceedings.

Your merged Florida entity will be governed by the Florida Business Corporation Act (FBCA). However, you should know that the South Carolina Business Corporation Act could continue to apply to some domesticating businesses under certain circumstances, such as if they have a nexus (taxable connection) or foreign qualification in South Carolina after making the move. Talk to our corporate attorney about this during your consultation.

It’s possible to merge a South Carolina corporation into a Florida corporation according to Section 33-11-101 of the South Carolina Code Annotated. South Carolina LLCs can also undergo a similar process if they’re interested in becoming Florida LLCs, which you can read about here.

Merging a South Carolina corporation into a Florida corporation won’t dissolve your entity unless mistakes occur because the project wasn’t managed by an attorney. You don’t need to dissolve your entity at any point during this process, either, despite the claims of some incorrect non-attorney websites. Anyone saying otherwise can be ignored.

The Internal Revenue Service (IRS) usually allows relocating corporations to continue using the same EIN under certain conditions. Maintaining the business’s continuity and corporate identity are two of the most important factors here, as the IRS must consider it to be the same entity both before and after its reincorporation merger. Once they’ve made their determination, the IRS sends a private letter ruling to the company in question informing them of their decision.

Having a reliable and experienced attorney on your side is the best way to ensure that you have everything that you need to successfully merge a South Carolina corporation into a Florida corporation. Every company’s relocation will have its own specific requirements. With that in mind, what follows is a general overview and not instructions for moving your business to a new state. Detailed guidance like that requires scheduling a consultation with our corporate attorney.

Teaming up with our law firm for your reincorporation merger starts off with an initial consultation. During this meeting, we get to know the client’s goals for relocating and review their business to ensure its eligibility. Then, we can start developing a strategy for merging the South Carolina corporation into a Florida corporation that protects both the business and its owners along the way.

Some of the comprehensive services that you could benefit from by hiring our tried-and-trusted law firm to merge a South Carolina corporation into a Florida corporation include:

• Drafting the Plan of Merger and other required documents
• Ensuring compliance with the laws and other legal requirements in both states
• Filing the necessary documents with South Carolina and Florida state agencies
• Updating the C or S corporation’s bylaws and other corporate documents to reflect the merger
• A consultation to address final concerns and questions

You can help ensure that your company’s reincorporation merger is completed as quickly as possible by choosing our firm to handle this project. This efficiency comes from the years of experience that we have helping our clients move their businesses to Florida from other states. In most cases, this can be accomplished in about two or three months. However, more time might be needed depending on the size of the corporation and its assets.

It’s important to know that even small mistakes can lead to significant delays when you’re merging a South Carolina corporation into a Florida corporation. State agencies in Florida and South Carolina will each need at least several weeks of processing time. These agencies often face delays of their own, too, because of short staffing, backlogs, and other issues.

First, you’ll need to form a Florida corporation that your South Carolina corporation will be merged into, which will cost $70.00. As for processing the actual merger documents, Florida charges $35.00 and South Carolina charges $110.00, so it will cost at least $215.00 just to have your company’s initial paperwork filed. In addition to any other required expenses, remember that mistakes will only send this total higher, too.

Our corporate law firm offers flat fees for all of our business relocation services. These fees are based on the exact needs of that particular move. This helps prevent unexpected expenses and other unwanted costs during the reincorporation merger. Schedule your consultation with us now to get a quote for merging a South Carolina corporation into a Florida corporation.

The risks of an improperly managed reincorporation manager are wide ranging and have the potential to be long lasting, too. Working with an attorney to merge your South Carolina corporation into a Florida corporation is your best bet when it comes to protecting your business from threats that include fines, dissolution, and much more.

Your South Carolina corporation could face the following threats and dangers if you don’t have an attorney to help out with your reincorporation merger:

• Noncompliance with state laws
• Revocation of the South Carolina 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 moving it to Florida. 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.

Remember, this is not a complete list of the possible consequences that can come about from a mismanaged reincorporation merger.

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.

An attorney’s assistance is your best bet for achieving a seamless and secure reincorporation merger. Our firm can provide you with the knowledge, skills, and expertise that you need to successfully merge a South Carolina corporation into a Florida corporation.

1. Filing with the State of South Carolina will be a thing of the past if merging your South Carolina corporation into a Florida corporation removes your business’s nexus (taxable connection) in its initial incorporation state.

2. You can work with Florida professional accountants, attorneys, and other important service providers after merging your South Carolina corporation into a Florida corporation.

3. Relocate your business from South Carolina to Florida without delays or interruptions by choosing our experienced corporate law firm to merge your South Carolina corporation into a Florida corporation.

4. Florida incorporation documents will take over your South Carolina corporation’s original formation documents without delay. This helps ensure that the relocating C or S corporation can keep the same corporate powers, rights, benefits, exemptions, privileges, and principles when merging a South Carolina corporation into a Florida corporation.

5. Using a reincorporation merger to move your business from South Carolina to Florida won’t change the value of your corporation’s stock or the amount held by each shareholder. The original entity’s real estate and other property rights will transfer to the merged corporation, as will any liabilities and lawsuits. The new corporation’s name may be used in place of the South Carolina corporation’s name in the case of any pending legal procedures or actions.

6. The corporation’s directors and shareholders don’t need to reside in Florida in order to merge a South Carolina corporation into a Florida corporation.

7. You could remove your company’s taxable connection (nexus) in South Carolina by using a reincorporation merger to change it into a Florida entity. As a result, you might end up with a lower tax burden at the state level. However, you should talk to your tax professional to confirm this and learn more about the tax implications of your company’s move, as the specifics will be different for each corporation.

8. You won’t be required to get a new EIN after your business’s reincorporation merger. After merging a South Carolina corporation into a Florida corporation, your entity will still be the same business, just with a new state of incorporation.

9. Your business can also keep using the same bank accounts, taxpayer ID, operations, and contracts. Careful planning should be undertaken before merging your South Carolina corporation into a Florida corporation, however, to ensure that this is the case.

Because of the different tax laws in each state, preparing for the tax implications of your reincorporation merger is just as critical as finding the right attorney to help you navigate its various legal challenges. Be sure to find a trusted tax professional to assist with this, as our legal team can only give some limited information on these matters. A few topics to bring up with them could include:

• State Income Tax: Florida doesn’t have any state income tax at all, which is another way that you could save money by moving your business here. Of course, you’ll still be responsible for income taxes at the federal level regardless of your business’s formation state.

• Franchise Tax: Franchise tax isn’t issued by the State of Florida, either. The corporation should close its account with the State of South Carolina and file final returns if necessary.

• Nexus: A business has a nexus, or taxable connection, in any state where it has a physical presence, employees, or conducts substantial activities. If your corporation still has a nexus in South Carolina after its reincorporation merger, then it will still need to follow South Carolina tax laws.

At the end of the project, Attorney Patel hosts a final consultation with the client so that he can address any remaining questions or concerns that they might have after merging a South Carolina corporation into a Florida corporation. We also provide a checklist containing instructions to help them navigate their new responsibilities as Florida business owners.

Attorney Patel’s advice and guidance can continue to benefit you and your company well after your business’s reincorporation merger. Our corporate law firm also provides a wide ranging suite of services that could prove essential to taking your business to the next level in its new home state.

Don’t risk valuable time, money, and your company’s future by trying to merge a South Carolina corporation into a Florida corporation without the help of an experienced attorney. By trusting your reincorporation merger to our legal team, you’ll have more time and energy to focus on what matters most: actually running your business. Schedule your initial consultation with us now to start.

Is your South Carolina corporation ready to move down the Atlantic Coast to join us in Florida? Don’t risk breaking your business’s stride — to relocate to get assistance from an experienced business domestication attorney by calling (727) 279-5037 or by scheduling a consultation through our online calendar.

Image by ASSY from Pixabay.