By Sara Pogorzelski, National Corporate Research, Ltd.
Those who are responsible for annual/periodic report compliance in multiple states can often feel overwhelmed since state requirements and due dates vary so much. Although it is challenging, maintaining report compliance is important and missing deadlines may result in late fees, loss of good standing and administrative dissolution or revocation of your authority to business within the state.
How Do I Determine When an Annual/Periodic Report Is Due?
Report requirements and due dates vary depending on entity type and the state in which the company is formed or qualified to do business. Furthermore, some states use seemingly arbitrary triggers to determine each due date.
Examples of Due Date Triggers:
- Standard Due Dates: Alaska, Florida, Georgia, Rhode Island
- Anniversary Date/Month: Arizona, California, Nevada, New York
- Fiscal Year End: Kansas, Massachusetts, North Carolina, Vermont
- Designated State Jurisdiction ID/Report Month: Colorado, Missouri, New Mexico
States typically send notices about upcoming due dates; however, these notices should not be relied upon on as your sole reminder since they can easily be lost in the mail or caught by your SPAM filter in e-mail. If you are unsure of a report due date, it is advantageous to contact the state directly. When researching a due date, keep in mind that a state may not refer to its filing requirement as an “annual report.”
Examples of Report Names
- Annual Report: Arizona, Connecticut, Florida, Hawaii
- Annual Registration: Georgia, Minnesota
- Profit Corporation License Renewal & Annual Report: Washington
- Occupation Tax Report: Nebraska
What Happens If I Miss a Due Date?
The majority of states will apply a penalty/late fee if a report is not received and accepted for filing by the deadline. Penalties are usually non-negotiable and some states will also apply interest for every month that the company is delinquent.
In addition to an extra fee, your business may lose its Good Standing status and will not be able to obtain a Certificate of Good Standing (or equivalent) from the jurisdiction. A Certificate of Good Standing is a document issued from a state department by the request of a company. The document confirms your company is authorized to do business in the jurisdiction and has fulfilled all statutory requirements. A Certificate of Good Standing may be needed if you wish to qualify to do business in other jurisdictions or if the entity is applying for a loan or entering into a contract.
A delinquent company may be subject to administrative dissolution or revocation. This means that the company’s authority to do business has been terminated within that jurisdiction. In order to return to active status or good standing, the entity must either file a reinstatement or, in some cases, file a new qualification in the delinquent state. Both of these filings can be expensive and may provide a negative impression of the company to a third party.
Maintaining compliance with report deadlines eliminates wasted time and money curing delinquencies enabling your company to focus on its purpose and activities.
Note that the examples mentioned above do not represent a full list of state requirements.
For additional questions or for more information, please refer to the resources below.
This article is provided for informational purposes only and should not be considered, or relied upon, as legal advice.