Register a Foreign Business in California

California Register a Foreign Business Summary

California law requires owners or managers to register foreign business entities in California if the business entity was formed in another state and is operated in California. Failing to register as a foreign entity doing business in California may result in the following penalties:

  • Financial Penalties;
  • Deemed Consent to Jurisdiction of California Courts as Defendant; and
  • Inability to Maintain an Action in Court Until Registered and All Fines Paid.

San Diego Corporate Law will act as your registered agent in California FREE when San Diego Corporate Law is retained to register the foreign entity with California and for so long as San Diego Corporate Law is retained to complete the periodic statement of information filings with the California Secretary of State, compared to paying $50 to $150 annually for registered agent services.

Attorney Analysis

$250
  • Via Telephone
  • Up to 30 Minutes
  • Subject to Attorney Availability

Foreign LLC

$590
  • Includes CA Registered Agent
  • Includes Filing Fees
  • Good Standing Certificate Extra

Foreign Corporation

$625
  • Includes CA Registered Agent
  • Includes Filing Fees
  • Good Standing Certificate Extra

sproles

Michael J. Leonard helped us obtain our 501(c)(3), created our bylaws, and completed all of the necessary forms to establish a tax exempt status for our non-profit foundation. He was professional, quick, and great to work with. Mr. Leonard is also very connected in the community and has referred us to useful contacts.

Michel Sproles, Sproles Empowered Youth

FO

My experience working with San Diego Corporate Law has been nothing short of excellent. Michael Leonard is a tremendous asset, and provided us much needed assistance when forming our insurance agency. He assisted with the formation of our corporation, buy / sell agreement, company bylaws, minutes, and stock certificates. Michael is an utmost professional that I would refer to any friend or client.

Michael Fusco, Fusco & Orsini Insurance Services, Inc.

gwr

Michael J. Leonard at San Diego Corporate Law has provided GWR valuable assistance and professional advice. As a San Diego based high tech equipment manufacturer, we appreciate that we never have to waste his or our time explaining the engineering or scientific details of our situation as his strong, hands on physics and engineering background is invaluable. We are well protected with Mike looking out for our interests.

Richard Reineman, GWR Instruments, Inc.

pattersoneng

In 2009 San Diego Corporate Law converted my Sole Propriety Engineering Company into a “S” Corporation. My experience was painless and Mr. Leonard has done an excellent job staying in contact and continues to be a great advisor. San Diego Corporate Law comes highly recommended.

Curtis Patterson, P.E., Patterson Engineering, Inc.

best-rate-repair

Michael J. Leonard at San Diego Corporate Law is not your typical attorney experience. Michael puts his full attention into understanding your needs and provides the best solution to meet your goals. I highly recommend San Diego Corporate Law to any of my friends and associates.

Jeff A. Mudd, Best-Rate Repair Company, Inc.

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Working with San Diego Corporate Law made dealing with all the paper work of incorporating and setting up my business a dream! Michael is the ultimate professional and knows corporate law inside and out! San Diego Corporate Law is always available to answer questions, assist me with follow up items, and be my go-to and support team.

Elloise Bennett, AP Test Service, LLC

anazana

Mr. Leonard is competent, dependable, and gets the work done on time and within budget. He is very responsible to his customers. We would recommend him to anyone that requires a true professional.

Lidija Skolnija, anaZana, Inc.

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I was recommended to Michael to help me set up a new corporation I was starting. The advice he gave me was great, and I eventually hired his services to create the agreements and contracts between myself and my business partner. Throughout the process he guided me and asked very detailed questions. I felt that he had my back and my best interest at heart. Looking back now, the contracts he wrote have saved me close to $40,000 in money that I would have otherwise had to pay. Thank you Michael. Everyone should follow your standards.

Jason Delfos, Marketing and Advertising Design Group, LLC

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We hired San Diego Corporate Law to help us establish our business in San Diego. In the initial stages of setting up our business and transitioning to California, we were frequently out of town. During this time, Michael answered questions promptly and thoroughly by phone and email. He went above and beyond to keep us on deadline for our aggressive schedule. I would not hesitate to recommend San Diego Corporate Law to another business owner.

Alicia Sorber-Gallegos, Two Men and a Truck

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Having no prior experience with business law, I approached Michael to help me set up an LLC for my new company and help me review my legal disclaimers. Michael was very straightforward, honest and helpful. He took the time to explain every detail and answer all of my questions. His work was very diligent and completed exactly by the deadline promised. Michael and San Diego Corporate Law hold my highest recommendation!

Anton Ivanov, Dreams Cash True

clean-usa-power

Michael J. Leonard helped me configure my business entities into a solid investment vehicle. He is very professional, knowledgeable, easy to reach and timely. San Diego Corporate Law produced a unique and informative Private Placement Memorandum (PPM) for my business for less than half the cost other law firms were charging. I expect to use the PPM and San Diego Corporate Law for many years. I recommend Michael because of his efficient, hands on, practical approach to legal work in a time of dramatic changes with securities laws (JOBS Act).

John Copyak, Clean USA Power, Inc.

MGIV

San Diego Corporate Law helped me set up MGIV Inc and get established as an S-corp in 2013. I was a one man show and didn’t have a substantial amount of money to spend to get started. I was in the process of filing for a LLC through Legalzoom.com when something didn’t feel right. I picked up the phone and asked Michael if he was available to help. This was my first business so I knew nothing about filing for a corporation or legally establishing a business. Using his knowledge and expertise he coached me toward filing for an S-corp instead of an LLC. It saved the corporation $800 in 2013 and positioned it for success based on the MGIV Communication Consulting model. I find comfort knowing that my business is in good hands. Michael is a great resource and very personable so working with him is convenient and affordable! I recommend San Diego Corporate Law to anyone needing legal assistance with their business!

Michael Gordon IV, MGIV, Inc.

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When I needed to move my business from an office suite to a brick and mortar location, San Diego Corporate Law was instrumental in ensuring that the lease provisions were in my best interests. The specialized skills that Michael and his team possess, the fair and transparent fee structure, and their professional yet low pressure consultation process are the reasons why I will retain their services in the future.

Scott Weathers, Alpha Graphics La Jolla

cram

Michael J. Leonard at San Diego Corporate Law not only helped us establish our small business in San Diego, but he helped us to solidify our partnership to avoid any gray areas as we are a family-run business. Michael was easy to work with, knowledgeable, responsive, and professional, and we will continue to use him as our company lawyer moving forward.

Karen Posner, Camp Run-A-Mutt Sorrento Valley

kamo1

I have nothing but compliments to say about San Diego Corporate Law. Michael and his team have always delivered not only an extremely high level of service, but also have been so patient through the whole process of setting up our LLC. Whenever I have questions or need their service, they are very easy to communicate with and very reasonably priced. I will not only use them for any legal advice that I may need in the future, but also refer all the people that may also need their services.

Andrey Kamogari, Kamo Housing

mending-matters-teal

Michael assisted us with the process of incorporating our non-profit organization. Michael was responsive to all of our questions, and sensitive to the expedited timelines that we encountered. Among the best aspects we experienced in working with Michael was his appreciation for our specific goals and his candid and honest guidance to accomplish those objectives. I would highly recommend Michael Leonard and San Diego Corporate Law.

Esther Hemmen, Mending Matters

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San Diego Corporate Law has been a crucial partner for Little Black Diamond. Whether it’s routine incorporation paperwork or complex employment law, Michael is always very responsive and available to help handle our legal issues. He takes the time to understand your business and the unique issues that surround it in order to provide accurate and timely advice that considers the best interest of your business. San Diego Corporate Law is a true partner for any business.

Adam Rosenberg, Little Black Diamond, LLC

California Register Foreign Business San Diego Details

A Corporation, S-Corporation, LLC, or LP formed in a state other than California that will do business with one or more states including California may be required to register as the foreign business as a foreign entity with the State of California. There are two main bodies of law which will dictate whether a foreign corporation, S-Corporation, LLC, or LP will be required to register as a foreign entity doing business in California: the California Corporations Code and the California Revenue and Taxation Code, both of which are examined below.

The foreign entity registration requirement not only requires the filing of documents and payment of filing fees, but also carries tax ramifications, including the $800 minimum franchise tax paid annually by a corporation, S-Corporation, LLC, or LP to the California Franchise Tax Board. Since registering a foreign business entity with the State of California as a foreign entity doing business in California carries a significant cost, it is worth examining what California defines as “doing business” to ensure the foreign business entity does not register unless legally required to do so.

Per the California Corporations Code

The concept of “doing business” in California is laid out in the definition of “transact intrastate business” for a corporation or S-Corporation as entering into repeated and successive transactions of its business in California, other than interstate or foreign commerce. California Corporations Code § 191(a). For LLCs, the California Corporations Code utilizes the exact same definition. California Corporations Code § 17001(ap). The California Corporations Code does not define what constitutes interstate or foreign commerce but does specify activities that, in isolation, do not constitute transactions of intrastate business.

What Does Not Constitute Intrastate Business in California

Under California Corporations Code § 191(b), the following are not considered to be transacting intrastate business by a foreign corporation or S-Corporation, and under California Corporations Code § 17001(ap)(1) are not to be transacting intrastate business by a foreign LLC:

  • Having a subsidiary that transacts intrastate business.
  • Being a shareholder of a domestic corporation.
  • Being a shareholder of a foreign corporation transacting intrastate business.
  • Being a limited partner of a foreign limited partnership transacting intrastate business.
  • Being a limited partner of a domestic limited partnership.
  • Being a member or manager of a foreign limited liability company transacting intrastate business.
  • Being a member or manager of a domestic limited liability company.

Under California Corporations Code § 191(c), the following are not considered to be transacting intrastate business by a foreign corporation or S-Corporation, and under California Corporations Code § 17001(ap)(2) are not to be transacting intrastate business by a foreign LLC:

  • Maintaining or defending any action or suit or any administrative or arbitration proceeding, or effecting the settlement thereof, or the settlement of claims or disputes.
  • Holding meetings of its managers or members or carrying on any other activities concerning its internal affairs.
  • Maintaining bank accounts.
  • Maintaining offices or agencies for the transfer, exchange, and registration of the foreign limited liability company’s securities or maintaining trustees or depositaries with respect to those securities.
  • Effecting sales through independent contractors.
  • Soliciting or procuring orders, whether by mail or through employees or agents or otherwise, where those orders require acceptance without this state before becoming binding contracts.
  • Creating or acquiring evidences of debt or mortgages, liens, or security interests in real or personal property.
  • Securing or collecting debts or enforcing mortgages and security interests in property securing the debts.
  • Conducting an isolated transaction that is completed within 180 days and not in the course of a number of repeated transactions of a like nature.

In addition to these mirroring provisions for corporations and S-Corporations and LLCs, the California Corporations Code has unique definitions of what shall not be deemed intrastate commerce for each entity.

LLC Specific Definitions

Under California Corporations Code § 17001(ap)(3), a person shall not be deemed to be transacting intrastate business in this state merely because of its status as a member or manager of a domestic limited liability company or a foreign limited liability company registered to transact intrastate business in this state.

Corporation and S-Corporation Specific Definitions

Under California Corporations Code § 191(d), any foreign lending institution shall not be considered to be doing, transacting, or engaging in business in California solely by reason of engaging in any or all of the following activities either on its own behalf or as a trustee of a pension plan, employee profit sharing or retirement plan, testamentary or inter vivos trust, or in any other fiduciary capacity:

  • The acquisition by purchase, by contract to purchase, by making of advance commitments to purchase or by assignment of loans, secured or unsecured, or any interest therein, if those activities are carried on from outside this state by the lending institution.
  • The making by an officer or employee of physical inspections and appraisals of real or personal property securing or proposed to secure any loan, if the officer or employee making any physical inspection or appraisal is not a resident of and does not maintain a place of business for that purpose in this state.
  • The ownership of any loans and the enforcement of any loans by trustee’s sale, judicial process or deed in lieu of foreclosure or otherwise.
  • The modification, renewal, extension, transfer or sale of loans or the acceptance of additional or substitute security therefor or the full or partial release of the security therefor or the acceptance of substitute or additional obligors thereon, if the activities are carried on from outside this state by the lending institution.
  • The engaging by contractual arrangement of a corporation, firm or association, qualified to do business in this state, that is not a subsidiary or parent of the lending institution and that is not under common management with the lending institution, to make collections and to service loans in any manner whatsoever, including the payment of ground rents, taxes, assessments, insurance, and the like and the making, on behalf of the lending institution, of physical inspections and appraisals of real or personal property securing any loans or proposed to secure any loans, and the performance of any such engagement.
  • The acquisition of title to the real or personal property covered by any mortgage, deed of trust or other security instrument by trustee’s sale, judicial sale, foreclosure or deed in lieu of foreclosure, or for the purpose of transferring title to any federal agency or instrumentality as the insurer or guarantor of any loan, and the retention of title to any real or personal property so acquired pending the orderly sale or other disposition thereof.
  • The engaging in activities necessary or appropriate to carry out any of the foregoing activities.

However, nothing contained in California Corporations Code § 191(d) permits any foreign banking corporation to maintain an office in California unless otherwise provided for by the laws of the State of California to limit the powers conferred upon any foreign banking corporation as set forth in the laws of the State of California or to permit any foreign lending institution to maintain an office in California except as otherwise permitted under the laws of the State of California.

Per the California Revenue and Taxation Code

Doing business in California is defined as actively engaging in any transaction for the purpose of financial or pecuniary gain or profit. California Revenue and Taxation Code § 23101(a). Under California Revenue and Taxation Code § 23101(b), a foreign entity will be deemed to be doing business in California for a taxable year if any of the following conditions are satisfied:

  • The taxpayer is organized or commercially domiciled in this state.
  • Sales, as defined in subdivision (e) or (f) of § 25120 as applicable for the taxable year, of the taxpayer in this state exceed the lesser of five hundred thousand dollars ($500,000) or 25% of the taxpayer’s total sales. For purposes of this paragraph, sales of the taxpayer include sales by an agent or independent contractor of the taxpayer. For purposes of this paragraph, sales in this state shall be determined using the rules for assigning sales under §§ 25135 and 25136 and the regulations thereunder, as modified by regulations under § 25137.
  • The real property and tangible personal property of the taxpayer in this state exceed the lesser of fifty thousand dollars ($50,000) or 25% of the taxpayer’s total real property and tangible personal property. The value of real and tangible personal property and the determination of whether property is in this state shall be determined using the rules contained in §§ 25129 to 25131, inclusive, and the regulations thereunder, as modified by regulation under § 25137.
  • The amount paid in this state by the taxpayer for compensation, as defined in subdivision (c) of § 25120, exceeds the lesser of fifty thousand dollars ($50,000) or 25% of the total compensation paid by the taxpayer. Compensation in this state shall be determined using the rules for assigning payroll contained in § 25133 and the regulations thereunder, as modified by regulations under § 25137.

The sales, property, and payroll of the taxpayer include the taxpayer’s pro rata or distributive share of pass-through entities. California Revenue and Taxation Code § 23101(d). For purposes of this subdivision, “pass-through entities” means a partnership or an “S” corporation. Id. The Franchise Tax Board shall annually revise the amounts subdivision (b). California Revenue and Taxation Code § 23101(c)(1).


Foreign Business Entity Registration Questions?

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