Introduction
A Certificate of Good Standing (COGS) is a short, official document. It proves that your business exists legally and is up to date with all state requirements. If you run an LLC or a corporation, this document can be really important.
You might need it when you apply for loans, open a bank account, sign contracts, or do business in another state. The good news? Getting a COGS is usually simple and affordable.
Let’s walk you through what it is, why it matters, and how to get one for your business.
What Is a Certificate of Good Standing?
Definition and Importance
A Certificate of Good Standing is issued by your state government, usually the Secretary of State. It proves your LLC or corporation is:
- Legally formed
- Up to date on state filings and fees
- Active and authorized to do business
You may need it for:
- Signing big contracts
- Opening a business bank account
- Getting business financing
- Registering your company in a new state
Who Needs It and When
This document is used by both:
- LLCs (Limited Liability Companies)
- Corporations (C-Corp or S-Corp)
You might need a Certificate of Good Standing when:
- Applying for a loan
- Opening a credit line or business bank account
- Signing a lease or vendor agreement
- Expanding your business to another state (also known as foreign qualification)
Requirements to Be Eligible for a Certificate
Maintain Good Standing With the State
To get this certificate, your business must already be in “good standing.” That means:
- You filed all required documents
- You paid all business taxes and fees
- Your registered agent information is current
Common Compliance Requirements
File Annual Reports
Most states require LLCs and corporations to file a yearly report. If you skip it, you can lose your good standing.
Pay Franchise or State Business Taxes
Each state has different tax rules. Some charge a franchise tax. Failing to pay on time can block you from getting a COGS.
Maintain a Registered Agent
You must have an official person or service to receive state documents. If this agent changes, update the state right away.
Update Business Information Promptly
Your business name, address, and management info should always be current. Outdated info can cause issues.
Step-by-Step Guide to Getting a Certificate of Good Standing
Step 1 – Verify Your Business Is in Good Standing
Use Your State’s Business Portal
Go to your Secretary of State website. Search for your business to check your status.
Contact the Secretary of State’s Office
Can’t find the info online? Call or email the state office to ask about your standing.
Step 2 – Gather Required Information
Business Name and Entity Type
Be sure to enter your exact business name and select whether you’re an LLC or a corporation.
State Filing Number (if applicable)
Some states assign your business a number when you register. You may need this.
Reason for Request (if required)
Some applications ask why you need the certificate (e.g., for a loan or registration).
Step 3 – Choose Your Filing Method
Online Application
Most states let you request a COGS online. It’s fast and convenient.
Mail or In-Person Requests
If your state doesn’t allow online requests, you may need to print a form and send it in.
Step 4 – Pay the Filing Fee
Typical Costs by State
Fees usually range from $10 to $50 depending on the state.
Accepted Payment Methods
You can usually pay by credit card, check, or electronic transfer.
Step 5 – Receive and Store Your Certificate
Digital vs. Paper Certificates
Some states issue digital-only versions, others provide paper ones. Both are valid.
When to Order Multiple Copies
If you’ll use your certificate for more than one purpose, it’s smart to request extra copies.
State-by-State Differences
Varying Names and Terminology
Certificate of Status, Certificate of Existence, etc.
Some states use different terms, like:
- Certificate of Status
- Certificate of Existence
- Certificate of Authorization
They all mean the same thing as a COGS.
Different Processing Times and Fees
Same-Day vs. Standard Turnaround
Some states offer same-day service. Others take a few days.
Expedited Processing Options
You can usually pay extra to speed things up.
Special Rules for Foreign Entities
Out-of-State Registration Requirements
If you’re expanding your LLC or corporation to another state, you’ll need a COGS from your home state.
Common Mistakes to Avoid
Requesting Without Checking Compliance
Fixing Outstanding Issues First
Always check your standing and fix any issues before requesting the certificate.
Using an Outdated Certificate
Some Entities Require Certificates Issued Within 30-90 Days
Banks or partners may want a certificate dated within the last few months.
Ignoring Automatic Suspensions
How Suspension Affects Certificate Eligibility
If your business is suspended, you can’t get a COGS until you resolve the issue.
How Often Should You Request a Certificate?
For Ongoing Business Use
Keep One on File Year-Round
Some businesses keep a fresh copy ready in case of audits, renewals, or applications.
Before Major Transactions
Loans, Grants, Mergers, and Foreign Qualification
Always get a current certificate before:
- Applying for funding
- Entering a merger
- Expanding to another state
Alternatives and Related Documents
Articles of Incorporation or Formation
These are your original registration documents. They show how and when your business started, but they don’t prove current compliance.
Business Licenses or Permits
You may need local or state licenses in addition to your certificate. A COGS does not replace these.
Conclusion
Summary of Key Takeaways
- A Certificate of Good Standing proves your business is active and compliant.
- It’s often needed for banking, licensing, and expanding.
- You must meet state requirements before applying.
Final Tips
- Keep business records up to date.
- Use software or hire a registered agent to track compliance.
- Set calendar reminders for filing deadlines and fees.
Being ready with a valid certificate can save time, avoid delays, and open new doors for your business.
