What Is a Certificate of Good Standing?
A certificate of good standing, or certificate of existence, shows that a business has paid taxes, filed required documents, and otherwise complied with regulations in the business’s state of formation. You can obtain a certificate of good standing from your state’s business filing agency. It might be required when opening a business bank account, applying for a loan, or raising funds from investors.
No matter what state your business is located in, you’ll need to deal with a certain amount of regulation as a business owner. You’ll need to pay taxes at the federal and state level, file an annual report or other documents, and comply with local zoning and permitting requirements to continue operating.
As long as you follow these types of business regulations, your business entity will be in “good standing” with the state. When applying for a business loan, raising funds from investors, or applying for federal government contracts, you might have to prove your status by showing a certificate of good standing. This certificate serves as proof that your entity is legitimately authorized to transact business in the state, and can also greatly benefit your business goals down the line.
Learn about who can apply for a certificate of good standing , how to apply for one in each state, and how to maintain your good standing.
Who Can Apply for a Certificate of Good Standing?
The following types of business entities are registered with the state and can obtain a certificate of good standing:
- Corporations
- Limited Liability Companies
- Limited Partnerships
- Limited Liability Partnerships
- Limited Liability Limited Partnerships (this type of entity is only recognized in some states)
The following types of businesses don’t need to register with the state, so the state cannot issue you a certificate of good standing:
- Sole Proprietorships (whether you have a DBA or not)
- General Partnerships (whether you have a DBA or not)
Different states have different laws about which types of businesses need registration, so consult with your state’s business filing agency if you’re in doubt. If you’re asked to show “good standing” as a sole proprietor or as a partner in a general partnership, you might be able to show historical tax returns or bank account statements. However, you won’t be able to show a certificate of good standing.
When Do You Need to Show a Certificate of Good Standing?
There are several situations where you might be asked to show a certificate of good standing:
- When opening a business bank account
- When applying for small business insurance
- When applying for a business loan
- When raising money from investors
- When recruiting business partners
- When trying to form a contract with a new supplier or other company
- When applying for a government contract or government-backed business loan (e.g. an SBA loan)
- When registering to do business in a state other than your state of formation
It’s pretty common to be asked for proof of good standing in these situations. And it’s better to get the certificate ahead of time, as opposed to scrambling at the last minute to update your status with a state agency in the middle of loan or investor negotiations.
Some certificates of good standing expire after a specific date, so what’s valid for one use might not be for another. In addition, banks, investors, and others might request a certificate of good standing that’s been dated within a specific time frame, no older than 60 days for example. How long certificates of good standing are good for depends on the state and the purpose for which you need it.
Why Maintaining Good Standing Is Important
Even if you don’t need to show good standing for a specific transaction, a certificate of good standing can help you expand. This is because a certificate of good standing is often required when registering to do business in other states. Many states won’t allow a company to transact business within their boundaries if the company does not have good standing in the state where it was formed initially. Even further, some states require that the certificate be dated within a short period of time—as little as 90 days—before filing to do business in that state.
Some states will charge a fine if your business is not in compliance with their regulations, which is an obvious no-brainer for maintaining good standing. But you also want to make sure your business is in good standing in order to preserve the limited liability that filing for business status provides. If your business is not in good standing, in some states that could mean the loss of liability protection for you and your co-owners conducting business outside of compliance, or even the administrative dissolution of the business altogether.
There are many other problems that can arise from losing good standing. For example, you could lose access to state courts or even leave your company open to a higher chance of business identity theft. Identity thieves scroll through business entity search engines and take note of which companies lack good standing. Assuming that no one is paying attention, they often try to hack such companies’ websites or engage in other fraud.
Photo credit: Harborcompliance.com
How to Obtain a Certificate of Good Standing From Your State
Business entity laws vary among states, and “certificate of good standing” can be called “certificate of existence,” “certificate of status,” or other names in various states. It’s important to remain updated on what’s required in your state. A sample certificate of good standing is shown above. The document will contain a signature from your state’s secretary of state and their certification that your business is in compliance and up to date with all legal and tax requirements.
Online legal service sites such as LegalZoom and IncFile can file for a certificate of good standing on your behalf in all 50 states for various fees ranging from $50 to $100 plus state fees. If you’re not in good standing, some of these sites will even help you address any problems and reclaim your good standing, a process called reinstatement.
Note that you do not necessarily need to be incorporated in a particular state to request a certificate of good standing there. “Foreign” businesses can also request proof of good standing from the state where they operate, as long as they are registered in that state as a foreign business entity.
Most states have business entity search engines on their websites to informally check the status of your standing. To do this, you need to remember the name of your entity when it was registered with the state. If you’re having trouble, try searching for only part of the business name or use a keyword search. Most states require you to send a request for an official certificate of good standing by regular postal mail. The fee for requesting a certificate of good standing varies by state but usually ranges from $10 to $25. See our state-by-state breakdown below to see how you can make sure you’re in good standing in your business’s home state.
ALABAMA
This Southern state offers “certificates of compliance” easily through the Alabama Secretary of State website. Simply click on the link to “obtain a certificate of compliance” and follow directions from there. Your status will then be updated online whether you’re in compliance or not—you’ll have to call the provided phone number if not.
ALASKA
The northernmost state has a nifty online database of compliant businesses—you can search for your business status here. If you’ve never filed for a certificate of good standing in Alaska before, you can do so online.
Businesses in Alaska are required to file biennial reports. Every two years, businesses must make note of changes to the officials on record and keep records up-to-date.
ARIZONA
Corporations and limited liability companies may obtain a certificate of good standing from the Arizona Corporate Commission website or by submitting a Records Request Form by mail or in person.
ARKANSAS
The state’s website has a portal to search for your business and find links for purchasing and printing a certificate of good standing if your business qualifies.
CALIFORNIA
You can search for your business status in California online here. Applying for the certificate is another ball game: “Certificates, copies, and status reports can be obtained by submitting a request to the California Secretary of State’s Sacramento office either in person (drop off) or by mail,” according to the California Secretary of State website.
COLORADO
Search for your business on the Colorado Secretary of State website. This will tell you the status of your standing and also lead to a link where you can request certified copies of documents and even set up a secure business filing with the SOS.
CONNECTICUT
Good standing in the Nutmeg State is called a “certificate of legal existence” and can be obtained online. Note that the state of Connecticut requires annual reporting by the end of your business’s anniversary month each year.
DELAWARE
You can check the status of your Delaware entity online, but if you need an official certificate, you’ll have to submit your request in writing using their Certificate Request Cover Memo.
FLORIDA
You’re in good standing in the Sunshine State if you have a “certificate of status.” Sunbiz.org, an official State of Florida website, provides instructions for ordering a certificate of status online or by mail. You can search your status on the website here.
GEORGIA
Georgia’s “certificates of existence” can be checked on this website with an easy-to-follow portal: Search Business -> Review -> Payment -> Status.
HAWAII
The Aloha State requires annual business filings to remain in good standing. You can search for your status or print a certificate here.
IDAHO
Idaho offers online certificates of existence generated in your web browser, or official certificates delivered by mail through their website. Check your business’s standing through their Business Entity Search engine.
ILLINOIS
The search for good standing status in the state of Illinois asks you to define your business between Corporate and LLC, Corporate, or LLC. To obtain a certificate, you’ll need your business’s state of Illinois Authentication Number.
INDIANA
In.gov online services for corporations site has many link errors. However, you can obtain a certificate of good standing through a third-party website such as MyUSACorporation.com.
IOWA
“Certificates of Standing” in Iowa can be obtained through this website, where they’ll provide an entity database and links to print your certificate if you’re eligible.
KANSAS
Perform a Kansas business entity search here. You can also request a certificate of good standing online through the portal or by the Secretary of State’s phone or mail service.
KENTUCKY
Have you heard about the Kentucky Business One Stop Portal? Check your standing status here by searching for your organization. Remember to file an annual report with the state to preserve your good standing.
LOUISIANA
Check your Good Standing status in Louisiana here. Once you locate your business in the database, click on “Details” to view the full status. This portal will also provide links for purchasing official certificates.
MAINE
Verify your business’s status online here. Annual reports are required of businesses in Maine and can be filed online. The deadline to file is June 1.
MARYLAND
This will lead you to the Maryland Business Express site, where you can search your businesses status as well as file for official certificates.
MASSACHUSETTS
Make sure you in good standing with through MassTaxConnect, where the Commonwealth requires you to submit an annual certificate of entity tax status.
MICHIGAN
The Department of Licensing and Regulatory Affairs handles business compliance for the state of Michigan. Search their entity database here. To receive an official certificate, you’ll need to contact the department by mail.
MINNESOTA
Go the state’s Business Filings Online portal to search your status and order a certificate.
MISSISSIPPI
You’ll need to register with the Mississippi Corporations Registered Filer LogIn first. From there, you can search your business entity and obtain proper documentation.
MISSOURI
Here’s a link to Missouri’s Business Entity Search to check your status. To order a certificate, you’ll have to register through the Corporations Online Portal.
MONTANA
Annual reports are required in the Treasure State and are due every April. Once you have that in order, use the Montana Business Search to check your standing. Click on the name of your business to get a link to request a certificate under “Request Entity Information.”
NEBRASKA
Nebraska’s online Business Services includes a Corporation and Business Search where you can also be linked to obtain certificates.
NEVADA
Nevada’s Business Portal is known as SilverFlume—search for your business here. You’ll have to register with the site to request any documents.
NEW HAMPSHIRE
Register with the New Hampshire Corporate Division online to search for your business and obtain documents. The Granite State requires annual reporting as well to maintain compliance.
NEW JERSEY
You can search for you entity’s status or certificates through the State of New Jersey Business Records Service. It’ll cost you $6.25 for just a status report. Note that Jersey requires annual filing!
NEW MEXICO
Search for your business here—a status of “Active” doesn’t necessarily mean you are in active good standing. Click on your business name to get the full report. Remember that New Mexico requires annual reporting. You can request an official certificate online or by mail.
NEW YORK
Good standing in New York state is called a “certificate of status.” You can search a business database on the NYS website, but it won’t tell you if you are in good standing. You will have to call the New York secretary of state’s office in Albany, where they will be able to relay your status over the phone. You can reach them at (518) 473-1654—average wait time on a weekday is about 5 minutes. It’s helpful to have your DOS ID number handy, but they can also search by name. To get an official certificate of good standing, you’ll have to request one by fax or mail.
NORTH CAROLINA
Check your good standing status by searching for your business on the Secretary of State website—you will know you are in good standing if your status is “Current-Active.” There will also be a link provided to file your annual report there, if needed.
NORTH DAKOTA
You can search for your entity’s standing status through the North Dakota Business Records Search. If it does not say you are “active & good standing” in the database, it’s likely you will need to file an annual report, for which they provide a link.
Certificates can be obtained upon request with payment of $5 (check, money order, or credit card) through various outlets:
- Calling the Secretary of State 701-328-4284 or 800-352-0867 (Ext. 328-4284)
- Fax at 701-328-2992 addressed to the Business Division
- Email sosbir@nd.gov
- Mail addressed to: Business Division
Secretary of State
600 E. Boulevard Ave. Dept. 108
Bismarck ND 58505-0500
OHIO
The Buckeye State has a Business Filing Portal where you search for your business to get the charter/registration number you’ll need to check your status on the state’s online automated service for obtaining certificates of good standing.
OKLAHOMA
Good standing status can be searched on the Oklahoma Secretary of State website by searching for your entity name. From there, you can pay the $20 fee to obtain an official certificate.
OREGON
You can search for your business status and annual report filing due dates through Oregon’s Find a Business portal. To obtain a certificate, you’ll need to complete and mail or fax this form.
PENNSYLVANIA
As long as you are listed as “active” in Pennsylvania’s business database, you’re in good standing. To obtain an official certificate, call the Department of State’s office at 717-787-1057.
RHODE ISLAND
Businesses can be searched through the Rhode Island Corporate Database—if your business is not listed as “inactive” in your search, you are in good standing. Once you find your business in the database, click on the link to “Request of a Certificate” if needed.
SOUTH CAROLINA
South Carolina’s Business Entities Online has a direct portal to check your status—just click “Search Existing Entities,” and the database will show your status right away. You can also request certificates and documents easily online.
SOUTH DAKOTA
South Dakota requires annual reports, which you can file easily online. Their Business Services portal lets you search for your standing status online as well as request certificates.
TENNESSEE
You can find your business records, including good standing status, through Tennessee’s Business Services Online. From there you can request a “certificate of existence” or file an annual report.
TEXAS
Known as “certificates of account status” in the Lonestar State, statuses can be searched through the Comptroller’s online portal here. You’ll need to complete a Form 05-359 to obtain an official certificate.
UTAH
The Utah Business Name Search will inform you of your business’s status. If you are in Good Standing, Active, or Delinquent status, you can request a “certificate of existence” or “certificate of good standing” by clicking on the business name in the search portal or by mailing or faxing this form.
You’ll need:
- Name of business
- Whether you need the short-form certificate or the long-form certificate
- Name of the person or business requesting the information
- Complete address where copies are to be sent
- Daytime telephone number
VERMONT
You can search for your business’s status through the Vermont Corporations Division online. If you’re still unsure of your status, call the secretary of state’s office at 802-828-2386, where they can check for you. To obtain an official certificate, you need to register a log-in with the secretary’s website—where you can also file necessary annual or biannual reports.
VIRGINIA
Virginia’s SCC eFile can be used to search for entities. Scroll down to the “certificate of good standing/certificate of fact” and search for your business name or by using your SCC ID. This will pull up your standing and provide links to submit annual fees and reports.
WASHINGTON
Search for your business through the Washington State Corporations Search portal. You need your Unified Business Identifier (or UBI—a nine-digit number) in order to obtain a certificate, which will be listed under the Corporations Search.
WASHINGTON, D.C.
Create a profile on D.C.’s CorpOnline to access services such as entity searches and certificate requests. From there, click on “Business Filings Search” to check on your status.
WEST VIRGINIA
West Virginia has Business Entity Search where you can check active status and filing history—the state does require annual reports. Once your click into your business name, there is a link to purchase a “certificate of existence.”
WISCONSIN
Searching Corporate Records through the state of Wisconsin will lead you to your business status with the state. Click here to order various certificates of status.
WYOMING
To check your business’s status, search for your business entity and click on your business’s name to get your standing, the duration of that standing, and your Wyoming state-issued filing ID. Annual reports are required for some businesses in Wyoming, which you can file online. You can generate a certificate of good standing with your filing ID online.
Certificate of Good Standing: A Snapshot of Business Compliance
Certificates of good standing can be essential when you’re trying to grow your business. It’s a good idea to have this document ready to go before you apply for a business loan, open a bank account, or compete for a government contract. If you’re thinking of expanding your business nationwide and registering outside of your home state, that’s another situation where it’s helpful to have a certificate of good standing.
Fortunately, getting a certificate of good standing is usually pretty easy and inexpensive. Visit your state’s secretary of state office or business filing agency to get started.
The post How to Get a Certificate of Good Standing (And When You Might Need To) appeared first on Fundera Ledger.
from Fundera Ledger https://www.fundera.com/blog/how-to-check-that-your-business-is-in-good-standing/
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