How to Move an LLC to Utah
This article discusses the process for moving an LLC to Utah, but that process is only available if also allowed by the laws of the state that the LLC is moving from.
Click the button below for a free analysis of the law of both states. If domestication is allowed, the tool will outline the steps that must be taken to move the LLC to Utah and provide a no-obligation cost estimate.
There are many reasons why a business owner may want to move an LLC to Utah. This article discusses the use of domestication, known in some states as LLC conversion, to transfer an LLC to Utah.
What is Utah LLC Domestication?
Utah domestication is a legal procedure that can turn an LLC formed in another state—an out-of-state LLC or foreign LLC—into a Utah LLC.1 An LLC that domesticates to Utah is still the same company but is governed by Utah law once the domestication is complete.2
Utah’s LLC domestication process also allows a current Utah LLC to change its legal home state—called its state of organization or its domicile—to another state.3 Whether an LLC intends to domesticate into Utah or out of Utah, the other state must also authorize LLC domestications.
Utah has a similar statutory procedure called LLC conversion that lets a Utah LLC change into a different form of entity or vice versa.4 For example, a Utah LLC can convert into a corporation, or a limited partnership can convert into a Utah LLC.
Some states have one statutory conversion process that can change a business’s entity form or change its domicile (or, in some cases, both). In those states, an LLC can complete a conversion to move to a different state or to become a different type of entity. Utah authorizes two separate procedures:
- Utah domestication. A Utah domestication transfers an LLC to a new state, but the company is still an LLC.
- Utah conversion. A Utah conversion changes a business into a new type of entity.5
Why Transfer an LLC to Utah?
Utah’s domestication process is the most straightforward and inexpensive way to formally move a business from another state to Utah. LLC owners might want to move an out-of-state business to Utah for a variety of reasons. These are some of the most popular:
- Lower taxes. Utah’s simple, flat-rate tax system and low rates typically earn the state a position in the top ten most business-friendly states for taxes. A Utah LLC domestication may therefore result in significant tax savings—especially for businesses moving from high-tax states like California. The LLC will avoid income taxes in the original state if the transfer to Utah severs the connection—or taxable nexus—between the company and the original state.
- Legal benefits. A domestication to Utah may be a good business decision if Utah’s business laws mesh well with the owners’ business goals. For example, an LLC may benefit from a Utah domestication if Utah law better matches how the owners want to define member relationships or if the company wants to take advantage of Utah’s series LLC laws.6
- Owner convenience. Utah has one of the highest rates of population growth in the nation. A business owner who is one of Utah’s many new residents may want Utah law to govern the business. Having a business domiciled where the owner lives can simplify legal compliance and make communicating with state agencies more convenient.
- Decreased reporting requirements. A business that is domiciled in one state but has its principal office in another often must file annual reports in both states. A company that is headquartered in Utah but domiciled in another state may reduce its reporting burden by domesticating to Utah. The annual report fee in Utah is only $18.00, so focusing on Utah may also allow the business to save on reporting fees.7
- Easier professional hiring. Business professionals like accountants and attorneys who live in Utah are more likely to specialize in Utah law. Domestication of an out-of-state LLC to Utah may therefore make it easier for a Utah-based business owner to hire qualified professionals. Working with professionals from the same community can also enable long-term professional relationships and furnish more opportunities for networking.
Need to find out what it will take to move your LLC to Utah?
The Utah domestication process depends on the requirements of two sets of state laws. We have developed a streamlined system to efficiently transfer LLCs to Utah. Click the button below to get an overview of the process.
What are the Benefits of Utah LLC Domestication?
Utah’s LLC domestication procedure offers multiple benefits over alternate methods of moving a business to a new state. Domestication is designed to let an out-of-state LLC move to Utah with no disruption to its day-to-day operations.
- Same company. An out-of-state LLC that domesticates to Utah is still the same entity—just governed by Utah law.8 It can continue using the same Employer Identification Number (EIN) and is still the same taxpayer with the same filing history. The consistent identity helps to avoid administrative mistakes and extra legwork for the company.
- Same bank accounts. An out-of-state LLC that domesticates to Utah owns all the same assets—including financial accounts.9 The company can continue using the same bank accounts and maintain its existing relationships with lenders.10
- Same business contracts. The domestication process has no effect on the LLC’s business agreements. Contractual relationships stay in place, and the Utah LLC has all the same contractual rights and duties—with no need to sign new agreements.
- Same employees. An LLC domestication does not interfere with existing employment relationships. The company’s employees are still employed by the same employer, and there is no break in the relationship.
- No dissolution. The domestication process does not involve winding up affairs or dissolution of the LLC in its original state.11 The company simply changes jurisdictions. The LLC dissolution process is complex and often requires substantial legal fees. Avoiding dissolution allows for a quicker, more seamless transition to the new state.
- Foreign LLC registration. Registration as a foreign LLC in the business’s original state is not an essential part of the domestication process. The company can register as a foreign LLC if it will continue doing business in the original state, but it is not required. If the out-of-state LLC had authority to do business as a foreign LLC in Utah before the domestication, the authority is automatically revoked when the Utah domestication is complete.12 The company is a Utah LLC after domestication, so registration as a foreign LLC is no longer necessary to do business in Utah.
What LLCs Can Convert to Utah LLCs?
Not all out-of-state LLCs can domesticate to Utah. The initial criteria is that the out-of-state LLC’s current state must have a law that authorizes LLC domestications.13 The current state may call the process conversion—as long as it allows an LLC to change its domicile. If the current state has no statutory domestication procedure for LLCs, the out-of-state LLC cannot domesticate to Utah.
The out-of-state LLC also needs to ensure that it meets all Utah requirements for its type of business. Utah lets LLCs have any lawful purpose, but certain types of companies—such as Utah low-profit LLCs—are subject to extra requirements. A domesticating LLC that will be a low-profit LLC in Utah needs to have L3C in its name and must have a purpose that is charitable or educational—and not profit-oriented, political, or legislative.14
Professional services companies—the equivalent of a professional limited liability companies (or PLLCs) in other states—also have additional requirements.15 A professional services company is an LLC that offers to the public certain professional services that require a license—such as public accounting, architecture, law, dentistry, and professional engineering.16
A domesticating LLC that will be a Utah professional services company must have the required licenses and must meet the following requirements:17
- The company’s certificate of organization must describe the professional services it offers.
- The company must provide only one professional service and ancillary services.
- The company must provide professional services only through licensed professionals.
Need to find out whether Utah LLC domestication is an option?
Our LLC Domestication Analyzer analyzes both Utah law and the law of the state that the LLC is moving from. It can help you:
- Find out whether the LLC qualifies to convert to a Utah LLC
- Get a detailed step-by-step breakdown of the domestication/conversion process based on the laws of both states
- Get a free, no-obligation estimate of the costs involved to move your LLC to Utah
Click the button below for a free analysis.
How Much Does Utah LLC Domestication Cost?
An out-of-state LLC’s costs for an LLC domestication to Utah include labor costs paid to the service provider, filing fees, and commercial registered agent fees (if applicable).
An out-of-state LLC domesticating to Utah will incur labor costs paid to the service provider the company hires to handle the domestication process. Service-provider charges vary by provider and may be a flat fee or an hourly rate. The service provider’s work to complete an LLC domestication includes the following tasks:
- Obtaining and reviewing the information needed to prepare domestication documents;
- Drawing up domestication documents (such as the plan of domestication and statement of domestication);
- Communicating with the LLC’s member or managers including circulation of documents for signing; and
- Communicating with state agencies and submitting domestication documents.
A domesticating LLC must pay filing fees for documents submitted to state agencies. The Utah Division of Corporations charges a $37.00 filing fee for the statement of domestication. There is ordinarily a $54.00 filing fee when submitting an LLC’s articles of organization, but the Division of Corporations waives the fee when the articles of organization is submitted as an attachment to the statement of domestication.
The LLC’s current state will also charge a filing fee for the state’s equivalent of the statement of domestication. The fee amount depends on the state where the LLC is currently organized.
Registered Agent Fees
Every Utah LLC must designate a registered agent with authority to accept service of legal documents and other important communications for the LLC.18 A member or manager of the company can serve as registered agent. However, Utah LLCs often choose to hire commercial registered agents. A commercial registered agent is an individual or entity that serves as one or more businesses’ registered agent in return for an annual fee. Commercial registered agents must list with the Division of Corporations their contact information and status as commercial agents.
Commercial registered agents are often a worthwhile expense for an LLC. They help to keep important communications organized and also allow the LLC to avoid publishing a member’s, manager’s, or officer’s name and address.
Need a price quote?
Our LLC Domestication Analyzer includes a free, no-obligation estimate of the cost of moving your LLC to Utah. Click the button below for a fee quote.
How Long Does Utah LLC Domestication Take?
The Utah LLC domestication process usually takes less time to complete than other methods of officially moving a business. The total time depends on the parties’ turnaround time to complete each step of the process. The parties’ time includes:
- How long the document preparer takes to obtain information and prepare documents;
- How long the members or managers take to review and sign domestication documents or communicate any issues to the document preparer;
- How long the service provider takes to file the final domestication documents with state agencies; and
- How long the state agencies take to review and process the domestication documents.
The Utah Division of Corporations offers expedited processing (within two business days) for an additional fee of $75.00.
What Laws Govern Utah LLC Domestication?
A domestication of an out-of-state LLC to Utah is governed by both Utah law and the LLC’s current state’s law. Whenever both states address a particular aspect of the domestication process, the LLC must satisfy both states’ requirements. For example, a domesticating LLC’s plan of domestication must include each item that Utah requires and each item the current state requires.19 In other words, if the current state requires something that Utah does not specifically require (or vice versa), the LLC’s plan of domestication must include it.
This article focuses on Utah’s domestication requirements. A few parts of the domestication process are specifically governed by the law of the current state (the state from which the LLC is transferring). The current state determines:
- Whether domestication to Utah is possible from the LLC’s current state;20
- The standard under which the LLC must approve the domestication;21 and
- The requirements for the domestication document(s) that must be filed in the current state.
What is the Utah LLC Domestication Process?
The Utah LLC domestication process consists of two components: document preparation and administrative tasks.
An out-of-state LLC domesticating to Utah must prepare and adopt multiple domestication documents to complete the move. The person responsible for preparing the documents must take great care to ensure that all documents satisfy both states’ applicable requirements.
- Plan of Domestication. A Plan of Domestication that is designed to comply with the requirements of both Utah law and the law of the state that the LLC is moving from.
- Utah Statement of Domestication. The Utah Statement of Domestication with all information and any related documents needed for filing with the Division of Corporations of the Utah Department of Commerce.
- Domestication 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, certificate of conversion, or a similar term.22
- Utah Certificate of Organization. The Utah Certificate of Organization for filing with the Utah Division of Corporations. The Certificate of Organization is filed with the Statement of Domestication, as an attachment.
- Utah Operating Agreement. A state-specific Operating Agreement to properly structure the LLC as a Utah LLC, provide rules for profit distributions and decision-making, clarify the federal income tax classification, and help provide maximum liability protection.
- Resolution Authorizing Domestication. A resolution approving the transaction and adopting the Utah organizational documents as the LLC’s governing documents.
Our Utah LLC domestication service includes each of these documents, as well as explanatory letters and instructions, an operations manual, and related documents needed to complete the Utah LLC domestication process. Click the button below to find out more.
An out-of-state LLC that has fully prepared its domestication documents must then complete several administrative tasks to officially adopt the documents and conclude the domestication.
- Conduct preliminary name search. Check the official records of the Division of Corporations of the Utah Department of Commerce to determine whether the LLC’s name is available in Utah. (If the name is unavailable, a slight name change may be required to complete the domestication.)
- Obtain signatures on the Statement of Domestication. The Statement of Domestication must be signed by the required parties. The Utah Division of Corporations allows the Statement of Domestication to be e-signed.
- Obtain signatures on the Certificate of Organization. The Certificate of Organization must be signed by the required parties. The Division of Corporations allows the Certificate of Organization to be e-signed.
- File the Statement of Domestication. File the Statement of Domestication with the Utah Division of Corporations. The Division of Corporations allows the Statement of Domestication to be e-filed.
- File the Certificate of Organization. File the Certificate of Organization with the Division of Corporations. The Division of Corporations allows the Certificate of Organization to be e-filed.
- File domestication documents with prior state. File the domestication documents with the Secretary of State or equivalent agency for the state that the LLC is moving from.
These tasks are based on the system that we have developed to transfer an LLC from one state to another. We provide you with the option to save money by completing these tasks yourself (using the step-by-step instructions we provide) or hire us to handle everything for you. Click the button below to find out more.
What is the Legal Effect of Utah LLC Conversion?
Utah’s LLC domestication procedure lets an out-of-state LLC change its state of organization to Utah without interfering with the company’s day-to-day activities. The domestication statute includes a list of legal effects that reduce the administrative legwork needed to transfer an existing business to a new state.
- Company identity. The LLC remains the same company throughout the domestication, and there is no pause or interruption in its existence.23
- Governing law. After the domestication, the LLC is a Utah LLC and is primarily governed by the Utah Revised Uniform Limited Liability Company Act.24 If the out-of-state LLC before the domestication had authority to do business in Utah as a foreign LLC, the authority to do business as a foreign LLC becomes moot and is automatically revoked when the company becomes a Utah LLC.25
- Organizational documents. The company’s new Utah certificate of organization and operating agreement take effect and control the company’s internal affairs.26
- Company property. The Utah LLC still owns all the same property that the out-of-state LLC owned before the domestication. There is no need to sign deeds or transfer assets, and the domestication in no way limits or restricts the LLC’s property rights.27
- Company debts and obligations. All the out-of-state LLC’s debts, obligations, or other liabilities from before the domestication are owed by the Utah LLC after domestication.28 Domestication does not change any liability that a member or manager has (or does not have) for the LLC’s obligations.29
- Legal cases. Legal actions and administrative proceedings pending prior to the domestication move forward as planned and are not affected by the domestication. If the domestication results in a name change, the Utah LLC’s new name is substituted for the out-of-state LLC’s name.30
- Ownership interests. Members’ interests in the out-of-state LLC are converted under the terms agreed in the plan of domestication. That typically means that interests in the out-of-state LLC become interests in the Utah LLC, but the members can also agree to convert interests into money, property, debt, securities, or a right to acquire interests later.31
- Dissolution. Domestication is not considered a dissolution of the LLC, and there is no need for the company to wind up its affairs.32 The completed domestication does not trigger any rights that kick in if the company dissolves, liquidates, or winds up affairs—unless the LLC’s operating agreement or the current state’s law expressly says otherwise.33
- Utah Code 48-3A-1051(2).
- Utah Code §§ 48-3A-1056(1)(a)(i)-(ii).
- Utah Code § 48-3A-1051(1).
- Utah Code § 48-3a-1041.
- See Utah Code § 48-3a-1041(3)(b).
- See, e.g., Utah Code §§ 48-3a-112, 48-3a-1201.
- Utah Division of Corporations and Commercial Code, Fiscal Year 2023 Fee Schedule.
- Utah Code §§ 48-3A-1056(1)(f)-(g).
- Utah Code § 48-3A-1056(1)(b).
- Utah Code § 48-3A-1056(1)(c).
- Utah Code § 48-3A-1056(7).
- Utah Code § 48-3A-1056(6).
- Utah Code § 48-3A-1051(2).
- Utah Code § 48-3a-1302.
- Utah Code § 48-3a-104(2).
- Utah Code § 48-3a-1101.
- Utah Code §§ 48-3a-1105 – 1106.
- Utah Code § 48-3a-111.
- Utah Code § 48-3A-1052.
- Utah Code § 48-3A-1051(2).
- Utah Code § 48-3A-1052.
- Fourteen states use the term articles of domestication to refer to the document that must be filed with the state to approve the domestication: Iowa, Massachusetts, Minnesota, Nebraska, New Hampshire, New Jersey, North Dakota, South Dakota, Utah, Vermont, Virginia, Wisconsin, Wyoming, and Indiana. The corresponding document may be called a statement of domestication (Alaska, Arizona, Connecticut, Idaho, Illinois, Mississippi, and Pennsylvania); articles of conversion (Florida, Nevada, North Carolina, Oregon, and Washington) or certificate of conversion (California, Delaware, Georgia, Michigan, Ohio, and Texas). It may also be called a statement of conversion (Colorado, Maine), certificate of domestication (Kansas), request for conversion (Louisiana), or statement/plan of domestication (District of Columbia).
- Utah Code § 48-3A-1056(1)(a)(ii).
- Utah Code § 48-3A-1056(1)(a)(i).
- Utah Code § 48-3A-1056(6).
- Utah Code §§ 48-3A-1056(1)(f)-(g).
- Utah Code § 48-3A-1056(1)(b).
- Utah Code § 48-3A-1056(1)(c).
- Utah Code §§ 48-3A-1056(3)-(4).
- Utah Code § 48-3A-1056(1)(e).
- Utah Code § 48-3A-1056(1)(h).
- Utah Code § 48-3A-1056(7).
- Utah Code § 48-3A-1056(2).