Legal Question in Business Law in Illinois
My business partner and I are looking to form an LLC. At the moment, as we are running a lean startup, money is quite tight. Because of this we are looking at forming an LLC in Florida as the fees are much, much cheaper than in our home state of Illinois. It has also been recommended to us by several business owners that forming an LLC in Nevada or Florida is a good choice as they are favorable to such businesses.
What we are wondering is if we form an LLC in Florida, what additional filings, if any, do we have to make in Illinois and how much would they cost?
Thanks much!
3 Answers from Attorneys
Sorry to burst your bubble, but if you are conducting business in Illinois, you need to be authorized to conduct business in Illinois. Unfortunately, the fees for registering a foreign corporation or LLC in Illinois is the same as a domestic corporation or LLC. So, you will not save any money by registering in another state. In fact, if you do not do business in that other state, you essentially will be wasting your money.
As a Franchise Attorney I agree with the other attorney answer. If you form an LLC in another state, but operate out of IL, then you will essentially pay double. Consult with a good business or franchise attorney in your area for specific advice.
Mr. Franchise - Kevin B. Murphy, B.S., M.B.A., J.D.
Franchise Foundations, a Professional Corporation
I agree with the prior observations. But there are other considerations, too. By forming in one state and having significant contact with another, the LLC will be exposed to the jurisdiction of the courts of (at least) both states (i.e., it can be sued in, at least, both states). Also, LLCs are typically governed by the law of the state where they are formed. So, if an issue arises, you'll need an attorney that knows the law of the state of formation.
Kindly note and remember that my response is merely a general comment on the law related to your question, and NOT legal advice or opinion. Also, your question and my response does NOT create an attorney-client relationship between us. You cannot rely upon what I have written, because I do not have all of the information that I need to advise you or render an opinion. Even simple facts you have not shared can completely change my answer. For me to give you legal advice or opinion, you would need to hire me to be your lawyer, and then we would need to discuss this in detail and go over the documents.
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