Can a Wyoming LLC Operate in Another State?

Yes a Wyoming LLC can operate in another state but must register as a foreign LLC if it engages in regular, repeated, and continuous business activities in the new state. Online businesses or activities that don’t establish a physical presence may not need foreign registration.

Foreign registration depends on whether a state considers your LLC to be doing business there. Each state will have a different definition of what it believes is “doing business”. Understanding this is the key to determining how your LLC should be treated. 

To have an attorney form and maintain your LLC, choose our Wyoming LLC Registration. It includes a Wyoming registered agent service, BOI filing, and annual report filling. 

For those who want a done-for-you service, our Complete Package includes a 1-hour legal consultation so you have an attorney ready to answer any questions. It also includes attorney-client privilege, EIN filing, and a separate address with a utility bill for banking access. 

What Does “Doing Business” in Another State Mean?

“Doing business” in another state refers to engaging in commercial activities significant enough to require compliance with that state’s regulations. If an LLC “does business” in a state outside of Wyoming, it must typically register as a foreign entity and meet tax and legal requirements to operate legally.

While each state has its own rules and regulations, common factors that may indicate a company is “doing business” in another state include:

• Maintaining a physical presence in the state: Having a storefront, office space, or warehouse in another state is often an indication of “doing business” in that state.
• Hiring Employees in the State: Having employees who work within the state typically requires a business to register.
• Business Meetings in the State: Some states may consider a company to be “doing business” if it regularly holds meetings, such as board meetings, in the state.
• Regular Binding Contracts: Regularly entering into binding contracts in the state.
• Significant Revenue Stream: Having a steady and significant revenue stream from activities in the state.

Visit the Secretary of State for your chosen state to see how it defines doing business. 

What Exemptions Are There?

Several important exemptions exist when determining whether your Wyoming LLC is “doing business” in another state. You don’t need to register as a foreign LLC for certain activities considered incidental to your main business operations. 

• Isolated Transactions: Conducting a one-time sale or contract in a state may not require registration.
• Passive Ownership: Simply owning property, such as real estate or intellectual property, may not qualify as doing business unless actively managed.
• Online Sales: For businesses that only sell products online without a physical presence in the state, registration may not be required.
• Maintaining a Business Bank Account: Having a bank account in another state does not typically constitute doing business.
• Defending a Legal Proceeding: Defending a lawsuit in another state does not require registration.

If you meet the exemptions there’s no need to register your Wyoming LLC as a foreign entity and can continue doing business out-of-state. 

What If I have an Online Business with a Wyoming LLC?

Operating an online business through a Wyoming LLC typically doesn’t require you to register in other states unless you have a physical presence there. This means you can sell products or services online to customers across the country while maintaining your Wyoming LLC status. This can often provide tax advantages since Wyoming has no state income tax.

However, you’ll need to monitor your business activities carefully as your company grows. If you establish a physical office, hire employees, or open a factory in another state, you must register that LLC in the new state as a foreign entity.

How to Register Your Wyoming LLC as a Foreign Entity

Before expanding your Wyoming LLC into another state, you’ll need to complete a foreign entity registration process. 

1. Verify that your Wyoming LLC is in good standing and current with all state taxes and filing requirements.
2. Get a Certificate of Good Standing from the Wyoming Secretary of State, which proves your LLC’s compliance and active status.
3. You must then appoint a registered agent in the new state where you plan to operate. This agent needs a physical address in that state and must be available during regular business hours to receive legal documents.
4. Registering starts by completing an Application for a Certificate of Authority in your target state. You’ll provide details about your Wyoming LLC, including its legal name, formation date, and registered agent information.
5. Submit this application with your Certificate of Good Standing and the registered agent’s consent form to the new state’s Secretary of State office.
6. Once you pay the fee and your application is approved, your Wyoming LLC can legally conduct business in a different state.

Tax Obligations for An Out-Of-State LLC

Operating in multiple states means you must meet additional reporting requirements and tax obligations in those jurisdictions. We recommend that you speak to a tax professional if you’re concerned about your tax liability. 

Single-Member LLCs

A single-member LLC that expands across state lines is generally treated as a disregarded entity when it comes to federal tax. This means that the owner reports their taxes on an individual level rather than a business level. 

A foreign LLC may still have to pay state tax in the states it operates in. Many people choose Wyoming because it doesn’t have state taxes. While this is true, a foreign LLC operating in another state will be subject to the operating state’s rules on foreign LLCs

The taxable income is typically reserved for income earned from that state. For example, the member of a Wyoming LLC that operates in California may have to pay California state income taxes on the income they earn from California. 

Again, each state treats foreign LLCs differently. Some will be more relaxed than others. 

Multi-Member LLCs

Multi-member LLCs will have slightly different tax obligations. At the federal level, your multi-member LLC will be taxed as a partnership by default. This means you’ll need to file Form 1065 and provide Schedule K-1s to all members, who’ll report their share of profits on individual tax returns.

You’re also responsible for self-employment taxes on your portion of the LLC’s earnings. While Wyoming doesn’t impose state income taxes on your LLC’s profits, you’ll likely face state tax obligations wherever else you’re operating. 

Want a Wyoming LLC Attorney By Your Side?

If you’re looking to form a Wyoming LLC, do so with our attorney by your side. 

Every LLC from Start in Wyoming is formed and maintained by a local Wyoming attorney. It includes a registered agent service, annual filing, and a BOI report; everything you need to get started the right way. 

If you still have questions, contact our team and we’d be happy to help.