Vermont Business Registration: Everything You Need to Know
Vermont business registration is required for certain types of business organizations.3 min read
Vermont business registration is required for certain types of business organizations. If you want to do business under another name, you may have to register your business under a fictitious or trade name or DBA, which stands for "doing business as." In Vermont, the law requires that everyone doing business in the state, with the exception of limited liability companies or corporations, must file a DBA. This allows businesses to set up bank accounts, enter into contracts, and conduct business with the new name.
Vermont Registered Agents
Vermont requires that business entities have a registered agent. Examples of business entities include limited liability companies, limited liability partnerships, business corporations, and nonprofit corporations.
A registered agent is appointed to receive legal documents on your business's behalf. For example, if your business is sued in a lawsuit, a process server or sheriff will deliver the documents to your registered agent. It's important to choose your registered agent wisely because if they do not fulfill their duties, there can be consequences. If they miss a time-sensitive document, it can result in legal actions against your business without your knowledge. The court could move to enter a default judgment against you, or they could dissolve the business.
You are allowed to appoint an individual as your registered agent, provided they meet certain requirements, including:
- The person has to be a resident of Vermont.
- The person has to provide their name and street address which will be included in Vermont's public records. P.O. Boxes are typically not allowed since an agent has to sign for your documents.
- The person has to be available at the listed address during standard business hours in order to receive documents.
Registering a New Business in Vermont
Start by registering your business online with the Secretary of State. It will also be a requirement to register for a business tax account in order to get a withholding account number and determine filing frequency. Your new account number should be available in five to seven days after you register. If you file by fax or mail instead of online, the processing time will be around ten days. During the setup process, expect to be asked if your business provides health care coverage to its employees.
You may need to pay state unemployment taxes as well. The Vermont Department of Labor provides additional information on their website. You can even register and obtain an employer account number, which will be sent to you along with your tax rate in about two weeks. For new employers, the tax rate is typically one percent. For some industries, like construction, the tax rate may be higher.
Foreign LLCs in Vermont
Corporations and LLCs are considered domestic entities in the state where they were formed. If they want to do business in other states, they must register or qualify as a foreign business before that can happen. This process is done with Vermont's Secretary of State. In all other states outside of the one they were formed in, they will be considered foreign LLCs or corporations.
Not all businesses need to register. If the business's contracts within Vermont are continuous or substantial, or one of the following factors applies, then it's likely that the business needs to register.
- The business has employees in Vermont.
- The business has bank accounts in Vermont.
- The business owns real estate or is the tenant in a lease in Vermont.
- The business is in the telecommunications industry.
When you are ready to file, you will need certain information on hand, like:
- The business's name and entity.
- The date and state of formation.
- The registered agent's name and address.
- The business's principal office address.
- A Certificate of Authority.
- The business's fiscal year-end date.
If you are a corporation, you also need to provide the name and addresses of current officers and directors. For LLCs, you also need to provide names and addresses for all members and managers, list whether they are personally liable for debts and obligations of the LLC, and list whether the business is an L3C, or low-profit LLC. You also need a Certificate of Good Standing from your business's home state. The fee to file for foreign qualification is currently $100. This fee is due when you submit the application.
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