What is a Foreign LLC in Alabama – Definition and Filing

If you have an LLC in Alabama and want to expand your business beyond Alabama, you must form a foreign LLC. Any business, especially a limited liability company, located in other states, starts its operation in Alabama, must file a foreign LLC in Alabama. To do so, every LLC needs to file additional filing documents, along with tax and relevant documents with the Alabama government.

In this article, you’ll be reading about how to start a foreign LLC in Alabama. Along with that, the page guides you through the steps involved in managing and maintaining a foreign LLC in Alabama after you form it.

Forming a Foreign LLC in Alabama

A foreign LLC does not need to be a company from another country but a business formed under the laws of another state. If you register your LLC in one state and operate your business in Alabama, you probably need to register your LLC as a foreign entity here. Imagine, if your family owns a sushi restaurant in Alabama and you want to expand the chain somewhere in Texas, you must establish your restaurant in Texas as a foreign entity.

Anyone who has an active and in good standing LLC anywhere (except for Alabama) and wants to expand their operations in Alabama can file their LLC as a foreign entity. To start a foreign LLC in Alabama, you need to register it with the Alabama Secretary of State. Every state has a different rule for establishing a foreign LLC. Here are the steps to follow in Alabama for registering a foreign LLC.

Note: These are generic steps to file a foreign LLC in Alabama. Make sure to check with the State Secretary of State, before you start filing your business. – LLCBuddy Team

Step 1: Get the Certificate of Compliance From Home State

Before you proceed to register your LLC in Alabama as a foreign entity, you must get the Certificate of Compliance issued from your home state SOS. This is an important document to register an LLC in a foreign state.

If your LLC is originally registered in Alabama, then you must obtain the Certificate of Compliance from Alabama Secretary of State. If your LLC is in other states, the name of the same document might be different. Every LLC, registered in any state other than Alabama must get this document to register a foreign LLC in Alabama.

Filing Certificate of Compliance: In Alabama, you must request a Certificate of Compliance through the ADOR – Department of Revenue – Certificate of Compliance. The Alabama Revenue Department carefully reviews the application and issues the Certificate. $14 must be paid to the Revenue Department for the application ($10) and processing ($4).

Step 2: Choose Alabama Foreign LLC Name

Obtain a name reservation certificate and submit it with your foreign qualification requirements to the Alabama Secretary of State. Your LLC’s legal name outside of Alabama will be listed on the application, along with the name it will use in Alabama. Take note of the requirements for naming your LLC.

You can use the same name as your domestic LLC name, however, that name should be available in Alabama to use. Check name availability at Alabama’s business entity names and reserve your LLC name. There are a bunch of LLC naming guidelines in Alabama when it comes to forming a foreign LLC. Check the guidelines before you name your business.

Step 3: Select Alabama Foreign LLC Registered Agent

A registered agent is a person responsible for receiving all official and legal documents on behalf of your company, whether it is located domestically or in a foreign state. For a foreign LLC in Alabama, you must have a registered agent from Alabama only. No matter where your domestic LLC is located, you must hire a registered agent from Alabama for your foreign LLC.

You’ll need a registered agent to form a foreign LLC in Alabama and take note that the Alabama Resident Agent must have a local address. Here are the best LLC services on our list that will provide you with registered agents to ease your worries:

LLC Service	Our Rating & Pricing	Top Features	Learn More
#1 TOP PICK	4.5/5 $0 + State Fees	100% accuracy guarantee Worry-free service Great customer support	Learn More
	4/5 $0 + State Fees	Free LLC Formation Affordable Add-on services Other business solutions	Learn More

Step 4: File Application for Registration for Alabama Foreign LLC

The most important step is to send the application for registration with Alabama SOS. Download the PDF form from the Alabama Secretary of State website or file it online (whichever method is available). The form must be filled out with the following details:

LLC’s full legal name.
A fictitious name or a DBA (only if your LLC’s legal name is not available); Attach a statement of adoption of the fictitious name signed by all LLC members.
- DBA filing method in Alabama: three methods, online, by mail, and in person filing.
- Online: For online filing, you need to visit the Alabama Secretary of State website, submit the online form along with the filing fees.
- Offline: For offline filing, download the form and send it to State of Alabama Office of the Secretary of State, Trademarks Division, P.O. Box 5616, Montgomery, AL 36103-5616 OR drop off the form in person to State of Alabama Office of the Secretary of State, Trademarks Division, 11 South Union St., Suite 224, Montgomery, AL 36130.
- DBA filing fee in Alabama: $30
LLC’s principal office and mailing addresses
LLC formation state and date.
Registered agent’s name and address in Alabama.
Date when your LLC will start operations in Alabama.
Credit card information is on the last page of the form for the application fee.

Online Filing

Not Applicable

Offline Filling

To register a foreign LLC in Alabama, one must mail the PDF form to the Secretary of State’s office. Download the foreign LLC form from the link, type it with the correct information, and mail it to the address: “Secretary of State, P.O. Box 5616, Montgomery, AL 36103”. Mail 2 copies of the completed form along with a self-addressed, stamped envelope to the address mentioned.

Foreign LLC Registration Fee in Alabama: To file an LLC in Alabama as a foreign entity, the owner has to pay $150 to the SOS. The fee must be paid to the office of the Secretary at the time of submitting the forms.

The LLC cost in Alabama, even for foreign LLCs will differ between online filing and by mail. Also, read about what’s the major difference between Alabama’s domestic and foreign LLCs.

Step 5: Determine How Your Alabama Foreign LLC is taxed

Foreign LLCs are also subjected to the Alabama Business Privilege Tax and must file LLC annual reports each year. If you have a single-member foreign LLC then it will be considered as a ‘disregarded LLC’ by IRS. That means the LLC will not be regarded as a company but it will be taxed as an individual (the owner). If you already have an LLC in the home state, you must have obtained the EIN as well. You don’t need to obtain the EIN in Alabama for a foreign LLC separately as it is issued from the IRS.

For other types of LLCs (member-managed or manager-managed LLCs), it will be a ‘pass-through taxation‘ where the LLCs don’t get taxed separately, instead, the members and managers are taxed based on their personal income. So, foreign LLCs are taxed as same as domestic LLCs in Alabama. However, it is recommended to check with the Alabama Secretary of State for state-wise taxes.

Note that forming a foreign LLC would be good for your business as you can legally operate in a different state thus reaching a larger market and opening more opportunities for higher profit.

Filing Alabama Foreign LLC Online – Quick Recap

Get the Certificate of Compliance from your home state where your LLC is originally registered
Check if the name of your LLC is available in Alabama to use for your foreign LLC. If not, file DBA name with Alabama SOS.
Get a registered agent in Alabama to represent your foreign LLC in Alabama. Recommended, professional help instead of being your own registered agent.
File the Application of Foreign LLC with the Alabama Secretary of State following the mentioned method(s) above.
Make the processing fee.

BOI Reporting

According to the Corporate Transparency Act, every LLC (or business) has to send a BOI reporting to the Financial Crimes Enforcement Network (FinCEN). Once you establish an LLC and if it is enlisted under the list of reporting companies, you must file your BOI report in Alabama with the FinCEN.

After Forming Alabama Foreign LLC

Here are added things you need to accomplish after forming your Alabama Foreign LLC

Obtain Business Licenses. Find the business licenses you’ll need using the Business License Search. You can contact the license office at Alabama Department of Revenue.
File LLC annual reports and Business Privilege Tax. You must file an Annual Report before the stipulated time frame after forming your LLC in Alabama. Here’s everything about Alabama LLC Annual Reports.
Pay State Taxes like sales tax; you’ll need an EIN for your LLC.

FAQs

Can a foreign LLC operate in Alabama?

Yes, a foreign LLC can operate in Alabama by registering with the Alabama Secretary of State.

What are the requirements for forming a foreign LLC in Alabama?

In Alabama, a foreign LLC must file an Application for Registration with the Secretary of State and pay the required fees.

How much does it cost to form a foreign LLC in Alabama?

The cost of forming a foreign LLC in Alabama varies, but there are filing fees that must be paid to the Secretary of State.

Do I need a registered agent for my foreign LLC in Alabama?

Yes, a foreign LLC operating in Alabama must have a registered agent with a physical address in the state.

How long does it take to form a foreign LLC in Alabama?

The processing time for forming a foreign LLC in Alabama can vary, but it typically takes a few weeks to complete the registration process.

Can I use my out-of-state address for my foreign LLC in Alabama?

No, a registered agent with a physical address in Alabama is required for a foreign LLC operating in the state.

Are there annual reporting requirements for foreign LLCs in Alabama?

Yes, foreign LLCs in Alabama must file an annual report with the Secretary of State and pay the associated fees.

Can a foreign LLC in Alabama be owned by non-US citizens?

Yes, a foreign LLC in Alabama can be owned by non-US citizens, as long as they comply with all regulations and tax requirements.

What is the process for changing the name of a foreign LLC in Alabama?

To change the name of a foreign LLC in Alabama, the entity must file an Amendment of the Certificate of Authority with the Secretary of State.

Are foreign LLCs in Alabama required to collect sales tax?

If a foreign LLC has a physical presence or economic nexus in Alabama, it is required to collect sales tax on applicable transactions.

Can a foreign LLC in Alabama be dissolved?

Yes, a foreign LLC in Alabama can be dissolved by filing Articles of Dissolution with the Secretary of State.

What is the difference between a domestic and a foreign LLC in Alabama?

A domestic LLC is formed within Alabama, while a foreign LLC is formed outside of Alabama but operates within the state.

Can a foreign LLC in Alabama conduct business outside of the state?

Yes, a foreign LLC in Alabama can conduct business outside of the state as long as it complies with the laws and regulations of other jurisdictions.

Are there any restrictions on the business activities of a foreign LLC in Alabama?

Foreign LLCs in Alabama must comply with the same laws and regulations that apply to domestic LLCs, which may include industry-specific restrictions.

Can I form a foreign LLC in Alabama if I already have one in another state?

Yes, it is possible to form a foreign LLC in Alabama even if you already have one operating in another state.

Is a business license required for a foreign LLC in Alabama?

Depending on the nature of the business, a business license may be required for a foreign LLC operating in Alabama.

Can I convert my foreign LLC into a domestic LLC in Alabama?

Yes, a foreign LLC can convert into a domestic LLC in Alabama by filing the necessary paperwork with the Secretary of State.

Do foreign LLCs in Alabama need to appoint officers and directors?

The requirements for officers and directors of foreign LLCs in Alabama vary, but some entities may need to appoint individuals to fulfill these roles.

What are the tax implications for a foreign LLC operating in Alabama?

Foreign LLCs in Alabama are subject to state taxes, including income tax and other business-related taxes.

Can a foreign LLC hold meetings in Alabama?

Yes, a foreign LLC in Alabama can hold meetings within the state as long as they comply with any legal requirements for conducting business activities.

Can a foreign LLC own property in Alabama?

Yes, a foreign LLC in Alabama can own property in the state, such as real estate or other assets.

What are the penalties for operating a foreign LLC in Alabama without registering?

Operating a foreign LLC in Alabama without registering with the Secretary of State can result in fines and other legal consequences.

Can a foreign LLC in Alabama open a bank account?

Yes, a foreign LLC in Alabama can open a bank account in the state for business-related transactions.

Do foreign LLCs in Alabama need to comply with labor laws?

Yes, foreign LLCs in Alabama must comply with all labor laws and regulations that apply to businesses operating in the state.

How can I obtain a Certificate of Existence for my foreign LLC in Alabama?

To obtain a Certificate of Existence for a foreign LLC in Alabama, the entity must request one from the Secretary of State and pay any required fees.

Can a foreign LLC in Alabama apply for grants and incentives offered to businesses?

Yes, foreign LLCs in Alabama can apply for grants and incentives offered by the state or local government, as long as they meet eligibility requirements.

What is the process for expanding the business activities of a foreign LLC in Alabama?

To expand the business activities of a foreign LLC in Alabama, the entity may need to file additional paperwork with the Secretary of State and comply with any licensing requirements.

Can a foreign LLC in Alabama hire employees and contractors?

Yes, a foreign LLC in Alabama can hire employees and contractors to help operate the business, as long as they adhere to employment laws and regulations.

Are foreign LLCs in Alabama required to have a physical office or presence in the state?

While a registered agent with a physical address is required, a foreign LLC in Alabama may not need to have a physical office or presence in the state beyond that.

Can a foreign LLC operate in Alabama without registering with the state?

No, a foreign LLC must register with the Alabama Secretary of State to legally operate in the state.

In Conclusion

Having a foreign LLC in Alabama is nothing but expanding your business legally beyond the boundary of your domestic or home state. Starting a foreign LLC in Alabama does not require a lot of documentation or tasks. However, it is always good to seek help from a professional when it comes to running your business. From getting the Certificate of Compliance to hiring a registered agent in Alabama, a professional or attorney can always be a perfect help. ZenBusiness is one of the most accurate and user-friendly services that offer a bunch of LLC formation services. They offer LLC formation for $0 (excluding the state formation fee).

The cost of registering a foreign LLC in Alabama can vary depending on a range of factors. While the initial registration fees and ongoing expenses can be a significant investment, many companies find that the benefits of establishing a presence in the state outweigh the costs. By carefully considering the expenses involved and budgeting accordingly, companies can ensure that their foreign LLC in Alabama is a success.