For many entrepreneurs, relocating to Florida involves more than moving a family—it also means determining whether their business should move as well. Simply changing a mailing address rarely accomplishes the legal, tax, and operational objectives business owners hope to achieve.
Choosing the Right Structure for Your Florida Business Move
Depending on the type of entity and where it operates, a business may need to domesticate into Florida, merge into a Florida entity, register as a foreign entity, or form a new Florida company. The appropriate approach depends on numerous factors, including:
- State law
- Tax consequences
- Licensing requirements
- Contracts
- Financing arrangements
- The locations of employees and customers
Operational Considerations When Relocating a Business to Florida
Business owners should also evaluate:
- Whether key management decisions are being made in Florida
- Whether board or manager meetings occur in Florida
- Where company records are maintained
- Whether executive offices should be relocated
These operational details may become important if another state later questions where the business is truly managed or seeks to tax the business or its owners. They may also significantly affect the state tax consequences of a future business sale.
For many LLCs and other entities taxed as partnerships, careful planning before relocating may create opportunities to substantially reduce state income taxes upon a future sale of the business while minimizing the risk of residency or nexus challenges from a former home state.
Why Advance Legal Planning Matters
A coordinated legal strategy can help business owners relocate while minimizing disruption and avoiding unnecessary tax or regulatory issues. Working with experienced legal counsel before relocating often provides substantially greater flexibility than attempting to restructure after the move has already occurred.
Michael Salad is an attorney in Cooper Levenson’s Business & Tax practice group. He concentrates his practice on estate and asset protection planning, probate and trust administration, special needs planning, business transactions, mergers and acquisitions and tax matters. Michael holds an LL.M. in Estate Planning and Elder Law. Michael is licensed to practice law in Florida, New Jersey, New York, Pennsylvania, Maryland, Connecticut, Georgia, Massachusetts, Alabama, Arizona, Virginia, Michigan, North Carolina, and the District of Columbia. Michael may be reached at (954) 889-1850 or via e-mail at msalad@cooperlevenson.com.
The content of this post should not be construed as legal advice. You should consult a lawyer concerning your particular situation and any specific legal question you may have.