Florida LLC Plan of Conversion
Florida law authorizes a transaction called an LLC conversion that can move an LLC formed in another state to Florida (or vice versa).1 An out-of-state LLC can complete a Florida LLC conversion to change its legal home state to Florida without interrupting the business’s day-to-day operations or affecting its assets, liabilities, or contractual relationships.2
A Florida LLC conversion is a multi-step process that requires preparation of legal documents and filing in both states. Preparing a Florida LLC plan of conversion is the first formal step of the process.
What is a Florida LLC Plan of Conversion?
An LLC plan of conversion is a written document that serves as the blueprint for a company’s transfer to Florida or transfer from Florida to another state.3 A properly drafted plan of conversion specifies how the conversion will be carried out and how it will affect the business.
Some states use the name domestication for the legal procedure that changes an LLC’s legal home state (its domicile). In those states, the document that starts the process is called a plan of domestication. A plan of domestication in other states is the equivalent of a Florida plan of conversion. If an LLC’s current state uses the name domestication, the LLC’s plan for moving to Florida is both a plan of conversion (under Florida law) and a plan of domestication (under the original state’s law).
What Information Must a Florida LLC Plan of Conversion Contain?
The legal requirements for a plan of conversion or plan of domestication vary between states—though they are often similar. Florida law requires a plan of conversion to include:5
- The LLC’s current name (i.e., the name before the conversion);
- The LLC’s name, domicile state, and entity type after the conversion (for example, Converted Company, LLC, a Florida limited liability company);
- The manner and basis of converting ownership interests in the LLC before the conversion into ownership interests in the LLC after the conversion;
- The articles of organization or equivalent document (public organic record) that will govern the LLC after the conversion;6
- The full text of the written LLC operating agreement or equivalent document (private organic rules) that will govern the company after the conversion;7 and
- Any other provisions required by Florida law, the other state’s law, or the LLC’s governing documents.
It’s important to remember that an LLC’s plan of conversion must satisfy the legal requirements of both states. Florida’s list is the minimum that a plan must contain under Florida law. A converting LLC can add to its plan of conversion any other provisions that the other state requires.8
How Does an LLC Approve a Florida Plan of Conversion?
After an LLC creates a written plan of conversion, the company must formally approve the plan as the official act of the company. The law of the LLC’s current state (the state before the conversion) determines the standard for approving the plan of conversion.9 Florida generally requires approval by members holding a majority of the company’s membership interests. Any members who will be liable for debts, obligations, or other liabilities must approve the plan in writing.
It is usually best for all LLC members to sign the plan of conversion to show their approval. Written approval by all members avoids ambiguity and reduces the risk that members may later object to the conversion.
Does an LLC File its Florida Plan of Conversion?
There is no need for an LLC to file its Florida plan of conversion with the Florida Division of Corporations. A separate document—which Florida calls articles of conversion—is filed with both states’ filing offices. The articles of conversion makes the conversion a matter of public record and gives third parties official notice of the company’s transfer to Florida.10
What Other Steps are Needed to Move an Out-of-State LLC to Florida?
An LLC’s plan of conversion is the first step of a conversion to Florida. To officially move to Florida, an LLC must complete the entire conversion process. After preparing and approving the plan of conversion, the remainder of the conversion process includes:
- Preparing the articles of conversion and the other state’s equivalent document;
- Preparing the Florida articles of organization;
- Preparing any written resolution needed to authorize the conversion and the conversion documents;
- Filing the Florida articles of conversion and articles of organization with the Florida Division of Corporations and paying the $150.00 filing fee;11
- Filing the original state’s domestication document—often called certificate of conversion, articles of domestication, or certificate of domestication—with the state’s filing office (often the secretary of state) and paying that state’s filing fee; and
- Adopting a new Florida operating agreement that customizes the LLC’s management and internal affairs for Florida law.12
A Florida conversion is effective when the process is completed and the articles of conversion is filed and accepted.13 Or, a converting LLC can list a delayed effective date (up to 90 days) in its articles of conversion.14 When a conversion to Florida takes effect, the company is a Florida LLC governed by Florida law, but it otherwise remains the same company with the same assets, liabilities, and contractual rights and obligations.15
- Fla. Stat. § 605.0102(11).
- Fla. Stat. § 605.1041.
- Fla. Stat. § 605.1042(1).
- See Fla. Stat. § 605.1051.
- Fla. Stat. §§ 605.1042(1)(a)-(g).
- See Fla. Stat. §§ 605.0102(58); 605.0201.
- See Fla. Stat. §§ 605.0102(55); 605.0105.
- Fla. Stat. § 605.1042(2).
- Fla. Stat. § 605.1043.
- Fla. Stat. § 605.1045.
- Fla. Stat. § 605.1045(1).
- Fla. Stat. § 605.0105(1).
- Fla. Stat. § 605.0207(1).
- Fla. Stat. § 605.1045(2)(h).
- Fla. Stat. §§ 605.1046(1)(a)-(d).