If you own a corporation in Florida that’s been administratively dissolved within the last ten years, you still have an opportunity to have it reinstated, thanks to The Florida Secretary of State. The process is carried out online, and many choose to seek help from a professional entity management firm, to ensure that the application is correct and submitted appropriately. Then, once you’ve paid the fees, the state will reinstate your entity within a matter of days, but note that the fees are significantly substantial. Whether you choose to do this, or form a new corporation entirely, will depend upon many factors, some of which are outlined below:
It costs a lot more to reinstate a business, than to maintain it
This is the unfortunate reality, and it’s worth remembering that as far as the state is concerned, you must follow all relevant procedures to reinstate your business, irrespective of your reasons for wanting to do so.
What else can I do other than reinstate my business?
There are other options, but as with any important decision related to your business, it requires careful thought and due diligence. Here are your alternative options to reinstation:
- Sit back and do nothing
By far the simplest option, especially if the costs involved are higher than you can afford, you can simply leave your corporation as dissolved, and go on to other things.
- Form a new Florida corporation
While this is a less costly option than reinstating your corporation, there are some pitfalls to be aware of:
You may lose your corporate name – even if the waiting period of a year has passed, you may not be able to get your corporate name back if another company has formed one with a name that’s considered too similar.
Pay off loans – if your original corporation died being the debtor on any loans, you may find yourself responsible for repaying them.
Adverse taxes –there’s a chance that you may experience some taxes from the liquidation of your corporation when it’s dissolved, thanks to its operating history, which includes carry forward depreciation.
A new EIN – Even if the name you choose for your new corporation is the same as the previous one, you’ll likely have to get a new EIN once you’ve filed your final tax return. However, you can simplify this process by working with an entity management firm.
New credit – once you form a new corporation, your credit history is considered null and void, and you’ll essentially have to start all over again.
New contracts – you’ll be forced to resign any contracts with previous vendors, customers or banks once you form a new corporation.
Ultimately, the decision whether to reinstate your Florida corporation or start a new one, will likely come down to all of the factors above, but in many cases – and especially if you seek help from an experienced entity management firm – it can be far simpler to make the necessary payments to have it reinstated, as opposed to starting right from scratch.