Posted by John Merchant on March 02, 2008 at 10:44:19:
Law in all states, so far as case citations I’ve seen is that rental of LLC or Corp’s properties is DB, so registration and appt of resident agent-for-service is required.
Bronchick, Merchant-Doing Business in a State - Posted by Todd
Posted by Todd on February 29, 2008 at 03:51:42:
I live in Illinois where it costs $500 to file articles of organization to form an LLC. The state of Indiana charges $90. If I form my LLCs in Indiana and then set up land trusts in Illinois appointing a trustee that lives in Illinois, and then assign the beneficial interest of the trusts to the Indiana LLC, is my Indiana doing business in Illinois? Since the beneficial interest is personal property much like stocks, my Indiana LLC should not have to file an authorization to do business in Illinois (where the fee is $300, I believe). Please advise.
If no bus.conducted, no regis required - Posted by John Merchant
Posted by John Merchant on March 01, 2008 at 12:29:01:
The mere forming of an LLC out of state then using it in an IL trust would not, it appears constitute DB in IL.
In most states it would not and the corp or LLC would not be ruled to be DB in 2d state in all but 2 or 3 states.
Just as the mere ownership of RE by out of state LLC is not normally DB in other states.
So the out of state LLC or corp is not required to register if it’s merely the owner of RE in the 2d state.
But if your IN LLC is actually doing some kind of business in IL, such as renting a house or apt to tenants, then yes it should be IL registered under law.
The law on this is really tested if you need to sue, or if your corp or LLC is sued in the 2d state where it would be an issue as to whether it was or was not DB in tht 2d state.
A hefty penalty is incurred if it should have been so registered but was not, such as that LLC might not be permitted by the 2d state court to either sue or defend itself.
The lawyer on the other side would be very interested in your IN LLC not being registered in IL and would of course try to make a big deal out of that, but if the IN LLC was not really conducting any real business in IL, it would probably not be required.
Re: If no bus.conducted, no regis required - Posted by Todd
Posted by Todd on March 01, 2008 at 17:44:32:
Thanks for the response. The IN LLC will be renting houses and apartments. What if a management company is appointed or granted POA to conduct business on behalf of the foreign LLC, will the IN LLC be considered “doing business” then?
The proxies are just contractors - Posted by Rich-CA
Posted by Rich-CA on March 02, 2008 at 16:00:28:
so it would not work to designate a third party to act on your behalf. The problem is that in the state where the rent is collected, that is where you are doing business.