If you own a business that was created in a state other than West Virginia, you will need to qualify or register that business in West Virginia if you want to do business there. Here is an overview of the rules on how to qualify your foreign (non-West Virginia) limited liability company (LLC) to do business in West Virginia.
For West Virginia purposes, if your LLC is formed in another state, then it is known as a foreign LLC in West Virginia. In other words, foreign doesn’t mean from another country. Instead, it means your business was organized under the laws of another state. A domestic LLC, on the other hand, is one that is formed in the state where it is doing business. This is common usage throughout the United States. For example, an LLC formed in Arizona is a foreign LLC in Colorado.
According to West Virginia’s LLC Act, you are required to register your foreign company with the state of West Virginia if you are “transacting business” in West Virginia. What does this mean? Well, like most states, West Virginia’s LLC Act does not specifically define the phrase “transacting business” in relation to foreign registrations.
However, state laws governing when foreign companies must collect state sales tax in their state provide some guidance on the issue. Under these laws, a business must have a physical presence in—or nexus with—the state in order to be required to collect state sales tax on sales to that state’s residents. Generally speaking, physical presence and nexus are synonymous, and mean having:
Certain exceptions may apply and the rules can get more complicated with things like Internet sales. Nevertheless, in general, if you have an office, a store, a warehouse, or employees in another state, you will need to qualify your LLC as a foreign company in that state. For more details, including some possible distinctions between physical presence and nexus, check Nolo’s articles on Internet Sales Tax: A 50-State Guide to State Laws.
Like most states, West Virginia’s LLC Act specifies certain activities that do not constitute transacting business in the state. The items listed include:
For the full, legal description of each of the listed items, check Section 31B-10-1003 of the West Virginia Code. If your LLC’s only activity in West Virginia is one or more of the listed items, you should not need to register with the state.
To register your business in West Virginia, you must file an Application for Certificate of Authority with the West Virginia Secretary of State (SOS). You can download a copy of the application form from the SOS website.
To complete the form, you must provide more or less the same information that you need to create an LLC in your home state. More specifically, for a West Virginia application for registration, you need to provide:
You must include an original Certificate of Existence, Certificate of Good Standing, or equivalent document with your application. The certificate must be dated during the current tax year and issued by the secretary of state of your LLC’s home state. If you have a professional LLC, you likely will need to include a letter of authorization or approval from the appropriate state licensing board.
The paper application also has places where you can provide an email address, website address, and an indication of the number of additional pages you will be submitting with the application, if any. The downloadable form has detailed instructions.
You can mail in one original, or include a second copy if you want one stamped and returned to you. You can also file online. The filing fee is $150.
If your LLC transacts business in West Virginia without authority, it cannot bring a lawsuit in the state. However, not being registered does not invalidate your LLC’s contracts or prevent it from defending a lawsuit in the West Virginia. Also, the limitations on the personal liability of LLC members are not waived solely because the company transacted business in West Virginia without a certificate of authority.
If your business is organized as a corporation rather than an LLC, the rules and requirements for foreign qualification in West Virginia are similar. You will, however, have to use a different application form. See the West Virginia Secretary of State website for forms, information, and filing instructions for registering a foreign corporation in West Virginia.