You must choose a state to incorporate in and once you incorporate; your corporation is considered a domestic corporation of that state. Each state has its own corporation laws and its own requirements for incorporation and your corporation is governed mainly by the laws of the state in which you incorporated.
If you do business in a different state, you will be considered a foreign corporation (which means a corporation from another state) and will be required to register in that state also. If you are doing only minimal business in another state, you probably do not need to do anything. However, if you are doing substantial business in other states, then you will be required to register as a foreign corporation in each additional state.
Each state has its own definition of what “substantial business” means. However, substantial business usually means that you have an office or own real estate in a state or that you have employees in a state or that you have some other form of substantial business dealings or contacts with people in that state. It is important to find out because there can be penalties for doing business in another state when you are not registered as a foreign corporation there.
Most larger companies will be registered as foreign corporations in the different states in which they do business. Many smaller companies, depending on the nature of their business, will only be registered in their home state.
Did you like this? If so, please bookmark it,
