If you own an LLC or corporation as a non-U.S. citizen, can you acquire a Certificate of Good Standing to present to banks, financial institutions, vendors and investors when the need arises? The answer is yes.
What Is a Certificate of Good Standing?
The topic of non-U.S. citizens running a business can pose a number of questions, like do I need an (EIN) or can non-residents be LLC members? Here's another question: What is a Certificate of Good Standing?
Also referred to as a Certificate of Existence, Certificate of Status, Certificate of Authorization or Letter of Good Standing, this form shows that your business has complied with all of the state’s requirements, fees have been paid and tax obligations have been met. In essence, this document shows that you are registered to conduct business in your state.
How Do I Get a Certificate of Good Standing in the USA?
Obtaining a Certificate of Good Standing is a fairly straightforward process. The best option is to go to your Secretary of State to obtain a copy. This can involve a fee, which will vary by state. Some states offer a certificate for free and other states' fees range from $5 all the way to $100.
It’s also important to keep in mind that a Certificate of Good Standing has a shelf life. Ordering a certificate and filing it away will not work. Requesting parties or organizations are not interested in a certificate from last year or from even six months ago. (A lot can change within a year.) The value of the certificate is to show that your business is compliant and up-to-date with all the rules and regulations of the state.
For the most part, this document should not be more than a few months old. Filing time will vary depending on the state and can take between a few days to a week to receive. For quicker processes, requests should be submitted online. There are also added fees to help expedite the release of a Certificate of Good Standing. In most cases, a Certificate of Good Standing is valid for up to three months.
Why Would I Need a Certificate of Good Standing?
A Certificate of Good Standing is not like an inspection certificate or an accreditation provided by the Better Business Bureau (BBB) that one can often find framed within a lobby or posted on a door or window.
The fact is that many businesses do not have their Certificate of Good Standing even if they have complied with all of their state’s requirements. Rather, a Certificate of Good Standing comes into play if someone requests a copy. For the most part, these requests to show proof of your company’s standing will come from a vendor, investor or business partner, bank or financial institution.
Help Getting a Certificate of Good Standing
If you are planning on moving your business to another state and applying for foreign qualification, seeking a loan or connecting with a potential business partner and a request is made for your Certificate of Good Standing, time may be of the essence. The steps for acquiring the certificate are the same if you are working out of your apartment in Dubai or your basement office in Wilmington, Delaware.
But if you are already running your business outside the country and are looking for professional assistance, Incfile has been helping entrepreneurs and small business owners since 2004 in starting and growing their businesses.
Incfile can assist with filing your Certificate of Good Standing by handling your paperwork in a timely manner. This will allow you the opportunity to run your U.S.-based company from outside the country and in whatever corner of the world you choose to call home.