How to Move an LLC to Wisconsin

An out-of-state LLC can change its state of organization to Wisconsin through statutory LLC conversion. Wisconsin conversion is a legal transaction that changes an LLC’s state of organization, the state whose law primarily governs the company.

An out-of-state LLC, also called a foreign LLC, that converts to Wisconsin becomes a Wisconsin LLC governed by the Wisconsin Uniform Limited Liability Company Law. The LLC is otherwise the same business entity before and after the conversion process. Whether the conversion can proceed also depends on the laws of the state the LLC is leaving. To find out whether your LLC qualifies and what the process involves, request a free analysis of your LLC move.

Some states use the name domestication for the legal procedure that changes an LLC’s state of organization, also called its domicile.

In many of those states, a business can complete a domestication to change its domicile or to change its entity type. The same statutory process can accomplish either goal. Wisconsin reserves the name domestication for transactions that change a non-United States entity into a Wisconsin LLC (or vice versa). For example, a Wisconsin domestication might change an LLC formed in Mexico into a Wisconsin LLC. This article deals with conversions that change an out-of-state LLC into a Wisconsin LLC.

Legal Effects of Wisconsin LLC Conversion

Wisconsin law outlines the legal effects of LLC conversion, which are designed to minimize disruptions to the business. The Wisconsin LLC conversion process transfers an out-of-state LLC to Wisconsin without interrupting the company’s ordinary operations.

• Wisconsin law governs the company. After conversion, the LLC is still the same entity with the same tax identity and Employer Identification Number, but is now a Wisconsin LLC governed by Wisconsin law. The LLC’s new Wisconsin articles of organization and operating agreement control the company’s affairs going forward.
• The Wisconsin LLC holds title to the company’s assets. The Wisconsin LLC owns all real estate and other property that the out-of-state LLC owned before the conversion. The transition is seamless, with no need for deeds or asset assignments. The conversion does not count as a property transfer or hinder the company’s rights in any property.
• The Wisconsin LLC has the same debts and liabilities. All debts, obligations, or other liabilities that the out-of-state LLC had before the conversion now rest with the Wisconsin LLC. LLC members have the same liability for company debts, or lack of liability, as they had before the conversion.
• Business contracts are unaffected. The conversion does not interfere with the company’s business contracts. The Wisconsin LLC is still a party to the same agreements, and it has the same contractual rights, duties, and obligations as before the conversion.
• Legal proceedings are still pending. Any civil, criminal, or administrative cases or proceedings that involve the out-of-state LLC are not interrupted by the conversion. If conversion results in a name change, the Wisconsin LLC’s name is simply substituted for the former name.
• Ownership interests are consistent. Ownership interests in the out-of-state LLC convert into ownership interests in the Wisconsin LLC, or into cash, property, or rights, as described in the plan of conversion.

Why Business Owners Move LLCs to Wisconsin

Wisconsin’s LLC conversion process can be a handy tool for business owners who move to Wisconsin or who want Wisconsin’s business laws to govern the company. Any of the following motives might support an LLC conversion to Wisconsin.

• Owner convenience. An LLC owner who moves to Wisconsin may want to officially move the business, too. It can be more convenient for the same state’s law to apply to the owner and the business. The consistency reduces unnecessary administrative complexity and may make dealing with state agencies easier.
• Save on business taxes. A state can only tax a business if there is enough of a connection, or taxable nexus, between the state and the company. If an out-of-state LLC does most of its business in Wisconsin, a conversion to Wisconsin may end the requirement to pay taxes to the original state. Wisconsin also offers a variety of incentives for businesses, such as tax credits for development that creates employment and grants for employee training.
• Change to Wisconsin law. An LLC conversion changes the law that governs the business. A conversion to Wisconsin may be a wise tactic if Wisconsin’s business laws are better suited to the LLC. Wisconsin recently updated its LLC laws to allow more flexibility in how an operating agreement addresses an LLC’s management structure and the duties that members and managers owe to the company.
• Reduce the company’s annual reporting. An LLC that is formed in another state but does most of its business in Wisconsin typically files annual reports and pays annual fees in both states. A Wisconsin LLC conversion may reduce the company’s annual filing and fees if it ends the need to file annual reports with the original state.
• Simplify professional hiring. A Wisconsin LLC conversion may streamline the professional hiring process and allow for greater selection. Wisconsin-based accountants and attorneys will tend to be more familiar with Wisconsin’s rules than the rules of other states. Thus, LLC owners who live in Wisconsin can more easily identify qualified professionals if Wisconsin law governs the company.

Wisconsin LLC Conversion Requirements

Wisconsin LLC conversion under Wisconsin Statute section 183.1041(2) is not available for every out-of-state LLC. An LLC converting to Wisconsin must comply with both Wisconsin law and the current state’s law.

Wisconsin law controls the filing process, documents filed in Wisconsin, and the conversion’s legal effects. The current state’s law governs whether the LLC can convert to Wisconsin, the content of the written plan of conversion if required, the standard under which the LLC’s members or managers must approve the plan, and the effective date for the conversion.

Eligibility for Wisconsin LLC Conversion

Wisconsin authorizes inbound conversion under Wis. Stat. SS 183.1041(2), which permits a foreign entity to convert to a domestic limited liability company pursuant to a plan of conversion. The conversion must be permitted under the converting entity’s governing law, and the converted entity must satisfy the definition of an LLC under Wis. Stat. ch. 183 immediately after the conversion. The LLC must be in good standing in its originating state.

Documents Required for Wisconsin LLC Conversion

The Wisconsin LLC conversion process involves preparing and adopting several conversion documents that must satisfy both states’ requirements. The conversion documents memorialize the terms of the conversion and control the company when the conversion takes effect.

• Plan of Conversion. A Plan of Conversion designed to comply with the requirements of both Wisconsin law and the law of the state that the LLC is moving from.
• Wisconsin Articles of Conversion. The Wisconsin Articles of Conversion with all information and any related documents needed for filing with the Wisconsin Secretary of State.
• Conversion Document for Filing in Prior State. Depending on state law, this document may be called articles of domestication, statement of domestication, articles of conversion, certificate of conversion, statement of conversion, or a similar term.
• Wisconsin Articles of Organization. The Wisconsin Articles of Organization for filing with the Wisconsin Secretary of State.
• Wisconsin Operating Agreement. A state-specific Operating Agreement to properly structure the LLC as a Wisconsin LLC, provide rules for profit distributions and decision-making, clarify the federal income tax classification, and help provide maximum liability protection.
• Resolution Authorizing Conversion. A resolution approving the transaction and adopting the Wisconsin organizational documents as the LLC’s governing documents.

Processing Time for Wisconsin LLC Conversion Filings

The Wisconsin Secretary of State processes conversion filings at the effective date and time specified in the Articles of Conversion. Standard processing times vary. Contact the Wisconsin Secretary of State for current estimates.

Filing Wisconsin LLC Conversion Documents

After the necessary conversion documents are ready, the LLC must complete several administrative tasks to officially adopt the conversion documents and implement the conversion to Wisconsin. These tasks include conducting a preliminary name search with the Wisconsin Secretary of State to determine whether the LLC’s name is available in Wisconsin, checking the official records of the Wisconsin Secretary of State to ensure the name is not already in use.

If the name is unavailable, a slight name change may be required to complete the conversion. The LLC must also obtain signatures on the Articles of Conversion. The Wisconsin Secretary of State requires a manual (wet) signature on the Articles of Conversion and does not accept e-filing for this document. The Articles of Organization must also be signed by the required parties and e-filing is available for this document.

File the Articles of Conversion with the Wisconsin Secretary of State. The Secretary of State requires the Articles of Conversion to be filed by mail or in person, not by e-filing. The Articles of Organization should be filed alongside the Articles of Conversion. Finally, file the conversion documents with the Secretary of State or equivalent agency for the state that the LLC is moving from.

Costs and Filing Fees for Wisconsin LLC Conversion

An LLC’s costs for a Wisconsin conversion include labor costs charged by the service provider, filing fees charged by state agencies, and registered agent fees if the LLC hires one.

The documents and filings described above require professional preparation to comply with both states’ requirements, and coordinating submissions with two separate state agencies adds further complexity. The total cost depends on the company’s current domicile state and the provider the company chooses. To find out what your specific move will cost, request a free analysis of your LLC move.

Wisconsin Secretary of State Filing Fees

In addition to professional service costs, the Wisconsin Secretary of State charges a $150.00 filing fee for the Articles of Conversion. This fee covers both the articles of conversion and the articles of organization. The filing fee paid to the original state depends on the state where the LLC is currently domiciled.

Additional Costs of Wisconsin LLC Conversion

An out-of-state LLC that converts to Wisconsin will also incur labor costs and, if applicable, registered agent or registered office fees.

Labor costs are the amounts charged by the service provider the LLC retains to manage the Wisconsin conversion. Service providers may charge a flat fee or charge by the hour, with fee amounts varying by provider. Work that goes into a conversion includes obtaining and organizing information, drafting the conversion documents, communicating with the business owners and state agencies, and filing conversion documents with state agencies.

Any LLC that does business in Wisconsin must designate a Wisconsin registered agent and registered office. The registered agent’s name and contact information is listed with the Wisconsin Secretary of State.

The registered agent’s job is to accept service of process and other official communications for the LLC.

An LLC’s registered agent can be an individual Wisconsin resident or a business entity with an office physically located in Wisconsin. Although a member or manager can be an LLC’s registered agent, businesses often choose to hire a commercial registered agent service to avoid publicizing members’ or managers’ information. Registered agent services also provide a consistent, reliable means of receiving important notices, and the fee is typically around $100.00 to $200.00 per year.

Moving an LLC Out of Wisconsin

Wisconsin also permits outbound conversion under the Wisconsin Uniform Limited Liability Company Law. An LLC organized in Wisconsin can convert to another state by filing Articles of Conversion with the Wisconsin Secretary of State and paying a $150 filing fee. The outbound filing requires a Plan of Conversion approved by the LLC’s members.

Alternatives to Wisconsin LLC Conversion

When conversion is not available because the other state’s law does not allow it, a merger-based reorganization achieves the same result. Reorganization requires forming a new LLC in the destination state and merging the original LLC into it. Wisconsin permits LLC mergers, and the Wisconsin Secretary of State charges a $150 filing fee. For a detailed explanation of how reorganization works, see our guide to the LLC reorganization process.

Wisconsin LLC Laws That Apply After the Move

The Wisconsin Uniform Limited Liability Company Law, codified in Wisconsin Statute chapter 183, imposes ongoing requirements on all domestic LLCs, including those formed through conversion from another state. An LLC that converts to Wisconsin becomes subject to these obligations immediately upon effectiveness of the conversion.

Wisconsin requires domestic LLCs to file an Annual Report with the Wisconsin Secretary of State. The Annual Report must be filed during the calendar year quarter in which the anniversary of the LLC’s effective date occurs. Wisconsin charges a $25.00 annual filing fee. This reduced reporting requirement is one advantage of converting to Wisconsin, as it eliminates the burden of more extensive annual compliance filings common in other states.

Wisconsin refers to an LLC’s internal governance document as an Operating Agreement, governed by Wisconsin Statute section 183.0102(13). The Operating Agreement governs the LLC’s internal affairs, including the rights and obligations of members and managers, profit distributions, and management structure. The Operating Agreement is not filed with the state; it is maintained by the LLC as a private document.

Wisconsin law provides member and manager protections through several mechanisms. Members have protection through Wisconsin’s charging order provisions, which limit creditors’ remedies against LLC interests. Wisconsin law also imposes fiduciary duties on members and managers, including a duty of care and a duty of loyalty, though the operating agreement may modify or eliminate the duty of loyalty. Wisconsin law also addresses member dissociation, the process by which a member ceases to be associated with the LLC.

Get a Free Analysis of Your LLC Move to Wisconsin

Every LLC move depends on the laws of two states. Our free analysis compares the requirements of your current state and Wisconsin, confirms whether conversion is available, and provides a step-by-step roadmap with cost estimates.

Understanding the full domestication process, including document preparation and coordination between both states, is covered in detail in our guide to LLC domestication.

For a complete directory of states and the domestication or conversion procedures available in each, see our state-by-state LLC domestication directory.