West Virginia Foreign Registration / Do I need it?
Is a West Virginia certificate of authority required for your LLC? The exceptions, the property rule and the exemption
An LLC formed elsewhere must hold a West Virginia certificate of authority before it conducts business here, and the filing fee is $150. The statute does not define transacting business. It prints 12 exceptions, and it adds a rule about property that cuts the other way. A West Virginia business lawyer can say whether your company's activity is on the list.
How the statute is built
The rule is a short sentence from the Secretary of State: a foreign limited liability company must have a certificate of authority to transact business in West Virginia. Everything else is a list of exceptions, followed by one rule that goes the other way. The list is in the section of the LLC act headed activities not constituting transacting business, and the Secretary of State prints it again on the exemption form.
What the statute sets aside
The statute names 12 activities. In full they are maintaining, defending or settling a proceeding; holding meetings of members or managers; maintaining bank accounts; maintaining offices for the transfer of the company's own securities; selling through independent contractors; soliciting orders that require acceptance outside the state; creating or acquiring debt or security interests; collecting debts and enforcing security; conducting an isolated transaction completed within thirty days; transacting interstate commerce; and applying for withholding tax on an employee residing in West Virginia who works for the company in another state. The twelfth is holding all or a portion of the outstanding stock of another corporation authorized to transact business in West Virginia, provided the company does not produce goods or services or otherwise conduct business in the state.
The list, grouped
| Group | What the statute names |
|---|---|
| Legal | Bringing, defending or resolving a court or administrative case |
| Internal | Holding meetings of members or managers and other affairs internal to the company |
| Money | Accounts at banks; offices for transferring the company's own securities; taking on debt or security interests; collecting and enforcing security |
| Selling | Independent contractors; orders that bind only after acceptance elsewhere; commerce between states |
| People | Applying for withholding tax on a West Virginia resident employee who works for the company in another state |
| Timing | A single deal finished within thirty days and unrelated to a series of like deals |
| Holdings | Holding stock of a corporation authorized in West Virginia, if the company does no business itself |
The employee entry
One entry is unusual: applying for withholding tax on an employee residing in the State of West Virginia who works for the foreign limited liability company in another state. It concerns a resident who works for the company in another state. It does not say that employing someone who works inside West Virginia is safe.
What counts, in the statute's own words
Where many states stop at a list of exceptions, West Virginia adds a rule that cuts the other way: the ownership in this state of income-producing real property or tangible personal property, other than property the list excludes, constitutes transacting business. That sentence reaches real property and tangible personal property that produce income. A company holding either kind of property in West Virginia may be transacting business on that ground alone.
Where the list stops
The section carries a limit: the section does not apply in determining the contacts or activities that may subject a foreign limited liability company to service of process, taxation or regulation under any other law of the state. A company may be outside the registration duty and still owe West Virginia tax or face a lawsuit here. Filing the application alone does not qualify a company to do business in West Virginia, which also needs a business license from the Department of Tax and Revenue and any other license its work requires.
A single deal
A one-time deal qualifies when it wraps up in 30 days or fewer and has no pattern of similar deals around it. A series of deals, or a deal that runs past the thirty days, does not fit the entry.
The exemption route
A company that fits the list can apply for exemption rather than registering. Form LLF-2, Application for Exemption from Certificate of Authority of a Limited Liability Company, costs $25. The instructions tell the filer to review the business activities for which a company may claim exemption before filing for exempt status. Registration costs $150, so the exemption is the smaller filing, and Form LLF-2 prints the statute so the filer can check each activity.
Everyday situations
An account at a West Virginia bank is on the list. A salesperson who takes orders that someone in another state must accept is on the list. Sales made by independent contractors are on the list. A leased warehouse is not named, and neither is a storefront or an office; for those the general idea of transacting business governs, and the property sentence may apply.
Registered agent: first year included, then $149 a year
$199 plus the state fee, including your first year of registered agent service; after that the agent service renews at $149 a year.
Do I need it? Common questions
Does opening a bank account count?
A bank account here is among the listed exceptions, so it does not count by itself.
Does an employee in another state who lives in West Virginia count?
Applying for withholding tax on that employee is one of the listed exceptions.
Does owning rental property count?
It can. The statute counts real property and tangible personal property held here that produces income.
What if the company only sells through contractors?
Sales made by independent contractors are on the list.
Is an office or a warehouse covered?
Neither is named, so the general meaning of transacting business governs.
Can we file the exemption instead?
Yes, if the activities fit the list. It costs $25.
If the company has already crossed over
An LLC that works here with no certificate cannot begin a case in West Virginia courts until it has one, and the state's Attorney General may sue to restrain it. Even so, the failure to have a certificate of authority does not impair the validity of a contract or act of the company or prevent it from defending an action or proceeding in the state. See the penalty page.
Next steps with us
Once the company opts to register, we prepare and file the application for $199. Unsure yet? The step-by-step guide shows how the process runs.
What you pay
Get authority in West Virginia
West Virginia$199
+ $150 state fee
- Form LLF-1 prepared from your questionnaire answers
- A home-state good standing certificate dated in the current tax year
- A West Virginia agent for service of process, ours or your choice
- The filed certificate of authority, passed on to you
- Renewal: after the first year, the agent service renews at $149 a year
$150 is the Secretary of State's fee for an LLC. Veteran-owned companies can have it waived, and an exemption application costs $25. $199 plus the state fee, including your first year of registered agent service; after that the agent service renews at $149 a year.
Sources
- West Virginia SOS, register an out-of-state (foreign) business
- Form LLF-1 and instructions, application for certificate of authority of a limited liability company
- West Virginia SOS, fee schedule for services and registration
- West Virginia SOS, annual reports
- W. Va. Code 31B-10-1003, activities not constituting transacting business
- Form LLF-2, application for exemption from certificate of authority of a limited liability company
- W. Va. Code 31B-10-1002, application for certificate of authority
- W. Va. Code 31B-10-1008 and 1009, effect of failure to obtain a certificate of authority
Working in West Virginia?
Order now and the application is on file before another reporting season passes.