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What state to file in?

Asked by: Cady - 16 November, 2012
https://d25eic0jctudgb.cloudfront.net/images/site/avatars/default.png-f1597c1da25f30f8c1a941405e8391c8 Wondering if it's better to form an LLC in KS or AZ? Members live in KS, business would operate in AZ.
Answered by: Robert Kowalski - 16 November, 2012
https://d25eic0jctudgb.cloudfront.net/images/site/avatars/35.jpg-687fc92d5f6c5febcbdccb6895b08b8c Dear Cady,

It's an interesting situation, here is what I think: since the business will be conducted in Arizona you would need to register in that state anyway, so you might as well choose Arizona as the home state. Then, depending on the involvement of members in the business, you might need to register a foreign entity in Kansas.

For example, if a member is running some of the business operations from a home office in Kansas, then your company is required to foreign qualify in Kansas (in other words, register as Foreign Entity). If the members are not actively involved in management of the business then such registration might not be necessary.

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