How to move a small business out of Maine

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The Redomestication Process in a Nutshell

1. Enter your biz name HERE.

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24-48 hours

2. We prepare the legal docs.

Our dually-licensed attorney+CPA prepares the legal documents and sends them to you via DocuSign.

You sign. We take it from there.

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3. We submit the legal filings to the states.

We monitor the status closely, respond to inquiries from their offices, and send you weekly updates.

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1-3 months

4. Approved! ✅

We send you a checklist of go-forward obligations and simple steps for your tax pro to follow.

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Did you know? The average business that moves to a state without state-level income tax saves over $12,500 in taxes per year.

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Redomestication, also known as redomiciling, refers to the lesser-known legal process of transferring or moving the "home state" of an existing Corporation, partnership, or LLC, from Maine to a new state. It means keeping your existing company name, credit, and federal employer identification number (FEIN) without wasting time and money creating a new business entity, applying for foreign registration, or moving assets between companies.
— Prof. Chad D. Cummings, Esq., CPA

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How to move a small business out of Maine without disrupting contracts, banking, or tax identity

When clients ask how to move a small business out of Maine, they often assume the answer is to “close the old company and start a new one” in a different state. As an attorney and CPA, I view that approach as needlessly risky. It invites avoidable operational interruptions, contract assignment problems, and administrative errors that can follow an entity for years.

A more disciplined approach to moving a company out of Maine is to change the entity’s legal “home state” while preserving the business itself. In most fact patterns, the most effective mechanism is redomestication (also referred to as statutory conversion), which is designed to preserve continuity while relocating the entity’s domicile. For those evaluating how to relocate a Maine business through redomestication, the central objective is straightforward: move the entity’s home state while maintaining the legal identity that customers, lenders, and regulators already recognize.

Why business owners prioritize moving out of Maine: taxes, legal exposure, and administrative drag

There are legitimate strategic reasons to explore how to move a small business out of Maine. Many companies have evolved beyond the assumptions that made Maine a suitable domicile at formation—particularly where leadership, employees, or growth initiatives have shifted elsewhere. When operations and decision-making have moved, maintaining Maine as the home state can become an unnecessary layer of compliance.

From a planning standpoint, the relevant question is not whether Maine is “good” or “bad,” but whether Maine remains efficient for your entity’s facts. Business owners commonly seek to exit a prior state’s tax environment and legal framework to reduce administrative complexity, better align governance with where the business actually operates, and place the entity under a legal regime they consider more predictable for investors, lenders, and counterparties.

In that context, how to move a small business out of Maine becomes a question of selecting the transaction that preserves continuity while positioning the business for future growth. That is precisely the role that redomestication is intended to serve.

Redomestication is the most efficient answer to moving a small business out of Maine

For clients evaluating how to move a small business out of Maine, redomestication is often the most direct and cost-effective legal route because it transfers the company’s domicile without requiring the company to start over. In practical terms, the entity continues as the same business—merely under a new state’s formation statute—rather than becoming a different entity that must “replace” the old one.

This distinction is not academic. Business continuity matters because companies are collections of legal relationships: customer contracts, vendor agreements, lease obligations, bank arrangements, permits, insurance policies, and licensing profiles. A well-structured redomestication is designed to preserve those relationships and avoid the cascade of assignments, consents, and re-papering that frequently accompanies dissolution-and-reformation or merger workarounds.

Accordingly, for those seeking a reliable path on how to move a Maine small business to a new state via redomestication, the emphasis should be on legal continuity, not merely filing a new entity and hoping operational issues “sort themselves out.”

Key advantage #1: keeping the same FEIN when moving a small business out of Maine

One of the most consequential points in deciding how to move a small business out of Maine is whether the company can preserve its federal employer identification number. The FEIN is more than a tax account number. It is embedded in payroll systems, retirement plans, vendor onboarding files, bank compliance, insurance underwriting, and reporting profiles used by federal and state agencies.

Redomestication typically allows the business to keep the existing FEIN because the entity remains the same business—its home state changes, but its identity does not. By contrast, forming a brand-new entity often triggers operational reconfiguration: new payroll accounts, updated W-9s, revised vendor master data, and, in certain cases, avoidable confusion with lenders and payment processors who use the FEIN as a primary identifier.

For that reason, businesses that are serious about how to relocate a small business out of Maine should treat FEIN continuity as a primary objective rather than an afterthought.

Key advantage #2: preserving contracts when relocating an existing Maine entity

Contract continuity is the practical pressure point in nearly every discussion of how to move a small business out of Maine. Many commercial agreements restrict assignment, require consent to transfer, or contain change-of-control provisions that can be unintentionally triggered by restructuring. Even when an assignment is legally permissible, obtaining written consents can be slow, politically sensitive, or operationally impossible when customers or vendors are unresponsive.

Redomestication is structured to avoid the “new entity problem.” Because the company continues rather than being replaced, counterparties are typically dealing with the same contracting party, now domiciled in a new state. That continuity reduces the risk of a vendor arguing that a contract is no longer enforceable, or that a customer can terminate for technical noncompliance.

In short, when advising on how to move a small business out of Maine, I prioritize mechanisms that minimize contract re-papering, preserve enforceability, and reduce the chance of triggering unnecessary disputes.

Key advantage #3: maintaining your business name and brand equity after leaving Maine

Business owners often underestimate the value of name continuity when evaluating how to move a small business out of Maine. Your name is tied to goodwill, customer recognition, online reputation, trade references, and—in many industries—regulatory filings and licensing databases. Losing it can generate both direct costs (rebranding) and indirect costs (lost leads, confused customers, delayed payments).

Redomestication typically allows the business to keep its name in most cases, which preserves brand equity and reduces transition friction. By contrast, forming a new entity or using a merger workaround can lead to naming conflicts, forced “doing business as” registrations, and inconsistencies across contracts, invoices, and bank records. Those inconsistencies are operationally expensive and legally avoidable.

For businesses deciding how to relocate a Maine company efficiently, maintaining the company’s name and brand identity should be treated as a core deliverable—not a convenience.

Common misconceptions about moving a small business out of Maine

A recurring misconception is that foreign entity registration is the best way to address how to move a small business out of Maine. Foreign registration can be appropriate when the business truly plans to operate in two states long-term. However, where the company has permanently ceased operations in Maine, foreign registration frequently creates ongoing obligations that owners hoped to escape—annual reports, registered agent requirements, and the continuing need to monitor compliance in the former home state.

Another misconception is that dissolving and re-forming is “simpler.” Dissolution can be administratively heavy when performed correctly, and it can create avoidable legal and tax complications. The process can also trigger operational hazards: contract lapses, licensing discontinuities, bank re-underwriting, and payment processor interruptions. In real-world operations, “simple” is rarely the same as “safe.”

For these reasons, businesses that want a decisive answer on how to move a small business out of Maine should distinguish between a transaction that merely creates a new entity versus a transaction that preserves the existing entity while relocating its domicile.

Practical considerations: governance, filings, and compliance planning after the move

Even when the legal path is clear, proper execution determines whether a plan for how to move a small business out of Maine delivers its intended benefits. A redomestication requires coordinated state filings and correctly prepared legal documents consistent with the governing statutes. Additionally, the company’s internal governance must be updated so that operating agreements, bylaws, member or shareholder consents, and state-specific disclosures align with the new domicile.

From a compliance perspective, the best outcomes occur when the move is treated as a managed project rather than a single filing. That means confirming registered agent arrangements, maintaining good standing through the transition, and planning the company’s “go-forward” obligations so the business does not accidentally create compliance exposure in either state. Businesses should also recognize that “moving” does not automatically eliminate tax or reporting obligations if the company still has nexus or ongoing operations in Maine; a careful facts-and-circumstances review is essential.

Owners seeking clarity on how to move a small business out of Maine using redomestication should prioritize a process that is legally precise, documentation-driven, and built to preserve continuity.

Conclusion: the most reliable strategy for moving a small business out of Maine is continuity-based

For most established companies, the central challenge in determining how to move a small business out of Maine is not whether the business can be re-created elsewhere; it is whether the business can relocate without collateral damage. Continuity is the governing principle: continuity of contracts, continuity of tax identity through the FEIN, continuity of brand and credit profile, and continuity of day-to-day operations.

Redomestication is specifically designed to achieve that continuity while transferring the company’s home state. It is frequently superior to foreign registration, merger workarounds, or dissolution because it relocates the entity itself rather than forcing the business to rebuild its legal and operational footprint from scratch.

Business owners who are prepared to implement a defensible plan for how to relocate an existing business entity out of Maine should review how to move a Maine small business to a new state through redomestication and proceed with a process engineered to protect the company’s continuity and long-term value.

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Domestication vs. Foreign Registration vs. Merger vs. Dissolution: A Comparison

Domestication is, in many circumstances, far preferable to registering an LLC or corporation as a foreign entity, especially where the LLC or corporation has permanently moved its operations and will not be returning to the prior state in the near future.

Some attorneys, unfortunately, confuse their clients by recommending a foreign entity registration in the new state, or worse, a merger, where a redomestication™ would have accomplished the goals of moving their business to a new state efficiently and effectively.

The top seven benefits of moving your company (LLC, corporation, or partnership) to a new state via redomestication™ to transfer your business include:

1. Maintaining your existing federal employer identification number, eliminating the tax headaches of forming a new company or transferring assets between companies (and inadvertently triggering a hefty tax bill from the IRS) when you move your business to a new state;
2. Keeping your existing business credit history and track record, safeguarding your reputation with clients, vendors, and creditors when moving your LLC or corporation to a new state;
3. Continuing your existing business name (in almost every case), protecting your most important assets when moving your company to a new state: your brand, reputation, and time you have already invested in search engine optimization;
4. Maintaining your existing contracts with customers and vendors because moving your business to a new state via redomestication™ does not create a new company: it maintains your existing company, saving you dozens (or even hundreds) of hours re-writing (and re-negotiating) contracts and changing banks;
5. Eliminating the need to continue paying registration fees and taxes in your prior state (assuming you have discontinued your operations there and have permanently relocated to a new state), potentially saving you tens of thousands of dollars (or more) in state taxes every quarter when you move your business to a new state;
6. Avoiding unnecessary IRS scrutiny because moving your LLC or corporation to a new state via redomestication™ is a tax-free transaction under the Internal Revenue Code; and
7. Reducing the amount of time you spend on administrative filings, saving you untold hours annually, by moving your company to a new state.

Before taking the "penny wise and pound foolish" approach of foreign entity registration or spending countless hours and exorbitant legal fees (and possibly taxes) on a merger or merger-gone-wrong to move your company to a new state, ensure you understand your options.

In most circumstances, redomestication™ (and not a foreign entity registration or costly and complicated merger) is the best route to achieve a change in company domicile to a new state.

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