To transfer your limited liability company (LLC) from any other state to Texas, you’ll need to go through a process called domestication. Here’s what you need to know:
What is domestication?
Domestication is the process a business undergoes when it changes its state of formation to another state. For example, if you formed your LLC in Wyoming but are now moving to, and operating your business out of Texas, you’ll want to file for “conversion,” which is the term Texas uses for the process of domestication.
Do I need to domesticate my Texas LLC?
Not necessarily. To move your business from one state to another, you could technically dissolve your original business and form an entirely new Texas LLC. However, doing so requires filling out all formation docs from scratch, which can be a hassle. For states that support domestication or foreign entity conversion, like Texas, that’s the easiest route for moving a business from one state to another.
How do I domesticate my LLC in Texas?
According to the Texas Secretary of State, any foreign LLC converting to a Texas LLC (i.e. domesticating in Texas) should follow these steps:
- Write a plan of conversion: This doesn’t necessarily need to be filed with the state, but it should be written down and kept on-file within your LLC. According to BOC §10.103, the plan of conversion should include your LLC’s old name and new name, the former and current entity type, and the entity’s previous and current jurisdiction.
- File a certificate of conversion: The certificate of conversion must include the plan of conversion (or summarize its contents) and be signed by the members of the foreign LLC before being filed with the Texas Secretary of State.
- File a certificate of formation: In addition to a certificate of conversion, you will have to file a Texas Certificate of Formation, which is what any new LLC in Texas has to file.
- Obtain tax clearance: If your LLC has done business in Texas before, you’ll want to obtain a certificate of good standing from the Texas Comptroller of Public Accounts. If your LLC is completely new to Texas, you’ll simply need to include a statement in the certificate of conversion that your LLC is responsible for paying Texas Franchise Tax.
- Pay Filing Fees: It costs $300 to file a certificate of conversion, and an additional $300 to file a certificate of formation. (Nonprofits are significantly cheaper: $50 and $25, respectfully.) Fess may be paid by check, money order, LegalEase debit card, or credit card.