Summary
The fact that you may need to register with state agencies like Vermont Secretary of State is a sneaky misconception that many folks miss.
However, with the rise of remote work, states have begun cracking down and levying penalties for those who (unknowingly) fail to register.
If you're considering operating in Vermont, use this guide to:
- Explore the that triggers the need to register with the Vermont Secretary of State, including criteria such as physical presence, economic activity, and advertising efforts.
- Determine where and how to register with the Vermont Secretary of State.
- Understand additional requirements such as Registered Agents, registration with other state departments, and ongoing annual reports.
What criteria would trigger the requirement to register with the Vermont Secretary of State?
Key Factors
Physical Presence: The following indicate strong physical presence in Vermont:
- Having an office, store, warehouse, or other physical location.
- Having employees, contractors, or sales representatives operating in the state.
- Owning or leasing property in Vermont (real estate or tangible property).
Economic Activity: These economic activities also suggest you're doing business in Vermont:
- Selling goods or services to Vermont customers (even remotely or online).
- Providing services within Vermont.
- Regularly engaging in business transactions within the state.
Specific Examples
The following activities would likely be considered doing business in Vermont:
- Operating a retail store or restaurant in Vermont.
- Having employees based in Vermont, even if working remotely.
- Maintaining a warehouse or distribution center in Vermont.
- Providing consulting or repair services to Vermont clients regularly.
- Selling products to Vermont residents through an online store or marketplace (especially if you hit certain sales thresholds).
Nexus and Other Considerations
Nexus: Vermont recognizes the concept of nexus, meaning a sufficient connection (physical or economic) can trigger tax and registration obligations, even for out-of-state businesses.
Economic Nexus Thresholds: There are specific thresholds based on sales into Vermont that could create a nexus even without physical presence.
Business Registration: Businesses deemed to be doing business in Vermont may need to register with the Secretary of State.
Where do I register, and what else is required?
- A Certificate of Good Standing is required
In addition:
A Registered Agent is required to serve as the company's physical in-state presence to receive important legal documents. Do not fall victim to the common misconception that you can leverage an in-state employee as your Registered Agent. It's far too risky.
You'll want to review the other registrations required in Vermont. Here's a Vermont specific guide we put together.
What is the registration fee?
The fee charged by Vermont is $125.
How long does Vermont usually take to process?
Vermont usually takes approximately 1 - 2 weeks to process registrations.
What is required ongoing?
Each state has a complex schedule of required annual reports, which can vary by entity type. Let's take a look at Vermont's:
C-Corporation
- Filing Date: Depends on registration date
- Filing Frequency: Annual
LLC
- Filing Date: Depends on registration date (within 3 months of annual date)
- Filing Frequency: Annual
Non-Profit
- Filing Date: Depends on registration date
- Filing Frequency: Annual
There is an Easier Way
Automate registration and annual report tracking in AbstractOps.This guide should definitely help reduce some of the confusion for Vermont. However, if you have multiple states to worry about, you may look to:
Automate state registrations and annual reports
Centralize email, snail mail, state ID’s, and registered agents, and
Take control of action items, eliminating risks before they become penalties.
Start the AbstractOps product demo to see how easy this can be.
Note: For the avoidance of doubt, nothing provided here shall contemplate, constitute or include tax or legal advice. Always double check with state agency websites for the most up-to-date requirements.