How can a Delaware LLC operate in California?
If you are a Delaware LLC operating in California, you are regarded as a foreign entity in California while you are a local business in Delaware.
If your company physically operates, recruits workers, does banking transactions or even is a company with a high income in California, you need to go through a process known as “Foreign Qualification.”
The Foreign Qualification process allows a company to operate in California (as a foreign entity).
What are the requirements to register your Delaware based business in California?
California requires an LLC application, certified “Delaware Certificate of Organization” and a certified “Certificate of Good Standing” .
You will also be asked to hold a registered agent. The registered agent is an intermediary between you and the state. It also accepts legal documents and takes process service from the state on your behalf. So, it serves as the physical address within the state.
Some choose to be its registered agent while others want to work with a certified professional agent. Usually, an enrolled agent registered in Delaware also operates and serves in California.
California requires an authority to sign under state laws about incorporation. Name and address of this authority must be stated.
The information provided in California will be public; however, they are not going to be published publicly unless otherwise is asked by the jurisdiction where your registered agent resides.
Your company will be responsible for some reporting obligations when it is registered to California. First reporting should be completed within 90 days after the date of application and biennial reports should be submitted until the last day of the month you registered in.
The application fee is $20, and it is the same for biennial reports. If you fail to fulfill this responsibility, California will charge you a penalty of $250. California is also famous for its minimum franchise tax of $800.
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