A. Qualification basically means registering your corporation or LLC so that it can do business in a different state. (Sole proprietorships and LLCs are typically just required to file a DBA aka- Doing Business As.) Although there are several factors involved with determining whether or not a company is "doing business" in a state, the criteria commonly includes whether the business is physically located in the state, has employees in the state, accepts orders for its products in the state, or maintains bank accounts in the state. For any other questions please contact a Chapter Group representative at 866-595-6915.

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A. States require foreign qualification as a way of keeping track of the business entities that are buying and selling within state boundaries. Since each state has different rules, you will need to check with the appropriate state government to determine the exact process you should follow. You probably won't have to maintain an office in the state, but you will be required to name a registered agent in the state. Registered agents are responsible for receiving official documents (legal and tax) for your business and must have a physical address rather than a PO Box. For any other questions please contact a Chapter Group representative at 866-595-6915.

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A. The benefits of qualifying your business are far greater than the risks involved with ignoring the requirement. Naturally, if the state discovers that a non-registered company is doing business within its borders, the company will be subject to significant fines and penalties. That alone should be enough reason to bite the bullet and register. However, failure to register has another consequence that can be even more damaging. If you are doing business without a registration, the state won't recognize your company's legal status. If your company is sued, you may be denied the right to defend yourself in court. In other words, plaintiffs can be awarded judgments against your business and there is nothing you can do about it. For any other questions please contact a Chapter Group representative at 866-595-6915.

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A. If for some reason you are dead set against qualifying your company in another state, there is another option. Instead of registering the company, you could choose to incorporate your business in each state you do business. This essentially classifies your business as a domestic corporation rather than a foreign corporation in each state, and eliminates the qualification requirement. The big advantage of incorporating in each state is that it provides a liability firewall. For example, if you are sued in Kansas, the assets your company holds through its Ohio corporation are protected. But there is also a significant downside to incorporating in every state you plan to do business: Duplication. Each corporation requires its own board of directors, officers, bank accounts, tax filings, etc. - the sum of which could overburden your company's staff resources if you aren't prepared for it. For any other questions please contact a Chapter Group representative at 866-595-6915.

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