2015 Qualification Handbook: Understand how to do business outside your state

What does it mean to qualify to do business in a foreign state? Is it something your company needs to do? What happens if you don’t qualify?

In order to do business legally in a “foreign” state, i.e., any state other than your state of formation, you must first qualify to do business there by filing with the Secretary of State or equivalent agency and paying a fee. In order to maintain good standing in that state, you’ll need to file an annual report, and may also be required to pay franchise or income taxes.

Not all business activities require you to qualify, but failure to do so can leave your company unprotected in the event of a legal dispute, and can lead to penalties for the company, its officers and directors.

Over the years, our customer reps fielded many queries from business owners and legal professionals about the rules and procedures for qualification, prompting us to develop a comprehensive resource on the topic: Guide to Doing Business Outside of Your State: The CSC 50-State Qualification Handbook.

This easy-to-read handbook provides you with the information you need to make the important decisions about qualifying in states where you plan to do business, and includes many case studies that can help you understand which types of business activities trigger the qualification requirement.

The book begins with a look at the Model Business Corporation Act (MBCA), which serves as a template for most states’ laws governing foreign corporations’ business activities within their borders. It goes on to examine the activities listed in the MBCA that are not subject to regulation, and those activities which will require a foreign corporation to register to business. Both types of activities are summarized in an easy-to-use chart that lists the activities that do not constitute doing business. There is also a detailed discussion of the consequences of failing to qualify how to cure qualification failures.

There is also a discussion of how corporate internet and e-commerce activity could trigger qualification requirements, and also includes information about qualifying and registration procedures for charitable organizations. There are detailed instructions for qualifying to do business in foreign states, as well as an appendix containing a list of the forms needed for qualification in all 50 states, with forms on the companion CD-ROM.

The handbook includes an extensive collection of annotated business statutes from all 50 states and the District of Columbia, which provides readers with easy access to the current statutes and relevant case notes that relate to doing business in a foreign state.

We update the handbook each year with new case illustrations and important legislative changes, to ensure that you are working with the most up-to-date information available.

Protect your company as you do business around the country: Make sure you understand qualification.

To learn more about the 2015 Edition of Guide to Doing Business Outside Your State: The CSC 50-State Qualification Handbook, call 1.800.533.1637 or visit us online at www.lexisnexis.com/csc.