Delaware LLC Doing Business in California

If you're a Delaware LLC doing business in California, your company is considered domestic to the state of Delaware and foreign to California. To take advantage of strong corporate law structure, forming an LLC in Delaware vs California is an easy choice.

If your business will have a physical presence by operating, hiring employees, banking or even holding an asset in California, you will typically need to qualify the business to operate there through a process known as Foreign Qualification.

The Foreign Qualification process enables a company to transact business in California. If you're a Delaware LLC operating in California or any other U.S. state, failure to adhere to local compliance regulations may put the protection of your company at risk.

What does California require to register your Delaware LLC as a foreign entity?

You will need a California limited liability company application for registration form, your approved Certificate of Incorporation from Delaware and a Certificate of Good Standing from Delaware. The Certificate of Good Standing can be no more than six months old.

California will also require you to have a Registered Agent in California. A Registered Agent is your liaison with the state, and provides a physical address within the state for the purpose of receiving any legal documents or service of process from the state.

Some people elect to be their own Registered Agent while others enlist the support of their Delaware Registered Agent. Often, the Delaware Registered Agent will also provide the service in California. The California Registered Agent will not need to sign the filing for a Delaware LLC in California.

California will require a person with the authority to sign under the laws of the state of organization of the LLC to sign the application. Keep in mind that they will require this person’s name and address.

All information provided to California will be made public; however, there is no publication requirement unless specifically required by the county in which your Registered Agent resides.

Once registered in California, your Delaware LLC operating in California will have reporting requirements. The initial report is due within 90 days of your filing, and the biennial reports are due on the last day of the month in which you filed.

The cost of this filing is $20 initially and is the same for the biennial report. Please keep in mind that California has a late fee of $250 if this requirement is not met on time. California also has a well-known minimum franchise tax of $800/year.

One way that California varies from other states is that a foreign LLC may not render professional services in the state of California. California will often advise you to contact your licensing authority before filing with the Secretary of State if your business is required to be licensed, registered or certified.

If you're planning on forming an LLC in California, first consider doing business in California as a Delaware LLC. You can learn more about Delaware Foreign LLC Registration on our website. Contact our team today to learn how to register a Delaware LLC in California.

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