Delaware Foreign Qualification: Can A Delaware Company Do Business In Other States?

If your company plans on doing business in another state, but was not formed in that state, you will need to complete a foreign qualification. 

Delaware business entities, like Delaware LLCs and corporations, are able to do business in other states. However, if you are opening an office or hiring employees outside of Delaware, you may need to register your business in that state. 

ORDER A FOREIGN QUALIFICATION FILING

How To Qualify a Delaware Company in Other States

Qualifying a Delaware company in a different state typically requires two steps:

Step 1.) File a foreign qualification document with the Secretary of State’s office.

Step 2.) Hire a Registered Agent in the state where the company is qualifying. 

Completing a foreign qualification requires filing a specific form that makes the Delaware company part of the public record in another state. This form has different names in different states. Here are some typical names for foreign qualification forms:

• Certificate of Authority to Transact Business (FL);
• Application for Authority (NY);
• Application for Registration of a Foreign Entity (TX);
• Foreign Registration Statement (DE);
• Statement and Designation by Foreign Corporation (CA);
• Statement of Foreign Qualification.

The foreign qualification form needs to be filed with the Secretary of State’s office. Most states also require a Delaware company to hire a Registered Agent within their state in order to qualify for conducting business. 

Most businesses formed as Delaware Corporations or LLCs are not actually located in Delaware. Delaware companies do business in all 50 states and in other countries all over the world. 

Do I Need to Foreign Qualify My Delaware Company?

If your Delaware LLC or Corporation is considered to be “doing business” in a different state, you need to complete a foreign qualification in that state. Some examples of “doing business” include:

• Opening a physical location in a different state,
• Fulfilling orders from customers located in different states,
• Hiring employees in different states, or,
• Owning assets (like real estate) in a different state.

Delaware Company Foreign Qualification in Different States: Cost Breakdown

• State Filing Fee (varies by state)
• $189 –  Agent processing fee
• $99 – Delaware Certificate of Good Standing (if required)
• $99 – Delaware Certified Copy (if required)

The cost of qualifying a Delaware LLC or Corporation to do business outside of Delaware varies by state. Each state charges different fees to complete a foreign qualification filing. 

IncNow® can prepare and file the documents to qualify a Delaware LLC or Corporation to do business in a different state for a $189 processing fee plus necessary state filing fees. 

Many states require a Delaware Certificate of Good Standing in order to complete a foreign qualification filing. A Delaware Certificate of Good Standing is a document that certifies that the Delaware company is compliant with state laws in Delaware and has paid its franchise tax balance. IncNow can obtain a Delaware Certificate of Good Standing from the Delaware Secretary of State for $99. 

In some cases, states may require a certified copy of a Delaware company’s Certificate of Formation (for a Delaware LLC) or Certificate of Incorporation (for a Delaware Corporation). IncNow can obtain a certified copy from the Delaware Secretary of State for $99. 

Foreign Company Qualifying in Delaware: Cost Breakdown

IncNow can complete a foreign qualification for a non-Delaware company looking to do business in Delaware. Completing a foreign qualification in Delaware requires the following: 

1. Obtain a Certificate of Existence (Good Standing) from the company’s home state,
2. Hire a Delaware Registered Agent, and
3. File a Qualification Certificate with the Delaware Secretary of State’s office.

Foreign Limited Liability Company – Delaware Foreign Qualification Cost

• $200 State filing fee
• $189 Agent processing fee
• $99 Delaware Registered Agent fee
• Certificate of Existence (Good Standing) from home state. 

Foreign Corporation – Delaware Foreign Qualification Cost

• $245 State filing fee
• $189 Agent processing fee
• $99 Delaware Registered Agent fee
• Certificate of Existence (Good Standing) from home state. 

What is a “Foreign Company” in Delaware?

A “foreign company” refers to any company that conducts business outside of its home state of incorporation. For example, a Delaware LLC with an office and employees in California would be operating in California as a foreign business entity. 

Delaware companies, like Delaware LLCs and Corporations, are able to do business in other states. However, a Delaware company may have to register in a foreign state in order to comply with local laws and regulations. 

What Happens If I Don’t Qualify My Delaware Company in Other States?

States typically charge fees and penalties if a Delaware LLC or corporation does business in their state without properly qualifying first.