What "foreign LLC" means
"Foreign" here means out-of-state, not out-of-country. If your LLC is formed in Wyoming but you're physically doing business in District of Columbia, you generally need to register the Wyoming LLC as a "foreign LLC" with District of Columbia.
District of Columbia foreign LLC registration cost
- Certificate of authority filing fee: roughly the same as a new domestic LLC in District of Columbia — ~$99.
- Certificate of good standing from home state: $10-$50.
- Registered agent in District of Columbia: $50-$200/year (you need a separate one for each state).
- Annual report in District of Columbia: $300 per 2 years.
- No franchise minimum.
When you must register
"Doing business" definitions vary, but typically include: having an office or employees in District of Columbia, owning property in District of Columbia, or executing repeated transactions with District of Columbia customers. Casual sales to District of Columbia customers usually don't trigger registration.
Penalties for not registering
- Loss of access to District of Columbia courts for collections.
- Back-payment of all years' annual fees with penalties.
- Personal liability exposure (the corporate veil weakens in some states).
The math: is it worth forming out-of-state?
If you operate in District of Columbia, forming in Wyoming or Delaware almost always costs more than just forming in District of Columbia, because you pay both states. Forming out-of-state pays off only for true holding companies and non-residents.