LLCs and Out Of State Investing

[Nicholas Hariprasad]

Hey guys, my dad had opened an LLC a few years back in 2021. We had opened the LLC in the state of PA. Can I use this same LLC in other states like Cleveland, Indiana .... An upcoming payment is due. The business will become inactive if we dont pay it. But what happens to the properties that are inside that LLC ? Just wondering. Any help is appreciated.

[Account Closed]

An LLC (Limited Liability Company) is typically organized under the laws of a specific state, and it is considered a separate legal entity from its owners (members). While you can use an LLC formed in one state to conduct business in other states, you may need to register the LLC in those other states to legally operate there. This process is known as "foreign qualification" or "foreign registration."

Here's what you need to consider:

1. Foreign Qualification: If your LLC formed in Pennsylvania wishes to do business in other states, like Ohio (Cleveland) or Indiana, it should typically register as a "foreign LLC" in those states. Each state has its own rules and procedures for foreign qualification, and you will likely need to file paperwork and pay fees in each state where you want to operate.
2. Registered Agent: Many states require foreign LLCs to appoint a registered agent in the state, which is a designated person or entity responsible for receiving legal documents on behalf of the LLC.
3. Compliance: Once your LLC is registered as a foreign entity in a new state, you must comply with that state's ongoing reporting and tax requirements. This can include annual reports, taxes, and other regulatory obligations.

Regarding the upcoming payment for your Pennsylvania LLC, if you don't pay the required fees and renewals, your LLC could become inactive or administratively dissolved in Pennsylvania. However, this typically does not directly affect the properties owned by the LLC. The LLC itself remains a legal entity, and the ownership of the properties by the LLC should remain intact.

Keep in mind that even if the LLC becomes inactive in Pennsylvania, you are still responsible for any obligations or requirements in other states where the LLC is registered or conducts business.

It's essential to consult with a legal or business professional who specializes in LLCs and has knowledge of the specific regulations in Pennsylvania and any other states where your LLC operates. They can provide guidance on maintaining the LLC's status and ensuring compliance with all relevant laws and regulations.