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Due to its strong and consistent corporate law structure, Delaware is by far the most popular choice for entrepreneurs looking to form a corporation. Delaware typically builds the biggest wall, also known as a corporate veil, between your business and the members behind your business.
When you form a Delaware corporation, your business is domestic to Delaware and foreign to every other state. The process in which your home state gives you the authority to operate there using your Delaware corporation is called Foreign Qualification.
The state of Wisconsin, like most states, has an application process and a state fee, and it also requires additional documentation from a Delaware company. This additional document is called a Certificate of Good Standing.
The Certificate of Good Standing cannot be more than 60 days old. This proves to Wisconsin that your Delaware corporation is current on all Franchise Tax and currently retains a Delaware Registered Agent.
If you know you will be registering as a foreign entity in Wisconsin, you should also keep in mind that in addition to the state fee associated with the Foreign Qualification application, Wisconsin will charge an additional $3 for every $1,000 of the corporation’s capital exceeding $60,000. Try to remember this when you set up the stock structure of your Delaware corporation so you may try to avoid any unwanted fees.
In order to remain in good standing in Wisconsin, your Delaware corporation must maintain a Wisconsin Registered Agent and file an annual report each year. This will be in addition to maintaining your Delaware Registered Agent and filing the Delaware annual report each year as well.
For more information on registering your Delaware Corporation as a Foreign Entity in Wisconsin, foreign qualifying a Delaware LLC in Wisconsin or obtaining a Wisconsin Registered Agent, please call Harvard Business Services at 1-800-345-2677.
THE AUTHOR OF THIS BLOG ARTICLE IS NOT A LAWYER AND HARVARD BUSINESS SERVICES, INC. IS NOT A LAW FIRM. THE ARTICLE ABOVE IS NOT INTENDED AS LEGAL ADVICE AND SHOULD NOT BE TAKEN AS LEGAL ADVICE. THIS SHORT ARTICLE IS STRICTLY TO MENTION SOME ASPECTS OF DELAWARE’S CORPORATION LAWS AND/OR LAWS RELATING TO OTHER FORMS OF ENTITIES WHICH YOU MAY NOT BE FAMILIAR WITH. WE RECOMMEND THAT YOU CONSULT WITH A LAWYER BEFORE FORMULATING A STRATEGY WHICH WILL BE SUITABLE FOR YOUR SPECIFIC CASE.