[CO] If my company was formed in Wyoming but operates from Colorado, which state is our principal place of business?

Lexi, Chatbot

I understand that determining the principal place of business can be quite complex. Can you clarify if your company has a physical office location in either Wyoming or Colorado?

Lexi, Chatbot

Are there specific legal requirements or regulations in either state that you are concerned about regarding your business operations?

Brandon

Hi there. My name is Brandon and I'm an attorney. I'll be happy to help you out today. Please note that this discussion is for guidance only and does not constitute an Attorney-Client Relationship. My answers and comments should not be considered legal advice.

Please also note that I am human, that I often need to research your answer to give you an accurate response, that I work with other customers and get up from time to time. So please be patient while waiting for a response. If more than 30 minutes have passed, please feel free to reach out.

Can you tell me more about the business?

Brandon

1. Defining the “Principal Place of Business”

Even though your LLC is organized in Wyoming, your principal place of business is determined by where the company’s management and direction actually occur. Courts and the IRS generally apply what’s called the “nerve center test”—a term drawn from Hertz Corp. v. Friend, 559 U.S. 77 (2010). The nerve center is where the company’s officers “direct, control, and coordinate” the business’s activities.

In your case, that appears to be your home office in Colorado, since:

• You are the operating partner with 51% ownership.

• You manage the daily operations, handle banking, and coordinate with your accountant there.

• You receive some IRS and business correspondence at your Colorado address.

• You perform and oversee contracts in Colorado through your foreign entity registration.

  Your registered agent’s Wyoming address exists mainly for legal compliance (to receive official correspondence), not to conduct or manage business. Therefore, your principal place of business should properly be listed as your Colorado home office, while the LLC’s state of formation remains Wyoming.

2. Venue for Lawsuits or Disputes

If your LLC were to bring a lawsuit—or be sued—without a venue clause in your contracts or operating agreement, courts would look to where the cause of action arose or where the company primarily operates. (28 U.S.C. § 1391)

In State Court:
If a dispute arises from contracts or conduct occurring in Colorado, venue would typically lie in a Colorado state court in the county where you operate or where the contract was performed. Since you’re registered as a foreign entity in Colorado and conduct business there, the courts would view Colorado as a proper venue.

Conversely, if a claim arises from activities in Wyoming (for example, if an event or transaction was centered there), a Wyoming court could have jurisdiction.

In Federal Court (Diversity Jurisdiction):
If the dispute involves parties from different states and the amount in controversy exceeds $75,000, federal courts determine jurisdiction based on both the state of incorporation (Wyoming) and the principal place of business (Colorado). That means your LLC would be considered a citizen of both Wyoming and Colorado for jurisdictional purposes. (28 U.S.C. § 1332)

In that case, venue would most likely fall within the U.S. District Court for the District of Colorado, assuming that’s where the operations and dispute occurred.

Brandon

3. Mailing and Recordkeeping Considerations

It’s common for LLCs to maintain multiple addresses:

• Registered Agent Address (Wyoming): For official state filings, service of process, and registered agent communications.

• Principal Office (Colorado): For IRS filings, tax returns, contracts, and operational correspondence.

• Mailing Address (either Wyoming or Colorado): The IRS allows a separate mailing address, so you can continue receiving federal correspondence at either location, as long as your EIN and tax forms are updated accordingly (Form 8822-B, if needed).

Keeping consistent documentation showing that your primary business management occurs in Colorado will help eliminate confusion and support your designation if questions arise about jurisdiction or tax nexus.

4. Next Steps

• Update your records to reflect your Colorado home office as the “principal place of business” on IRS filings, contracts, and internal documents.

• Keep the Wyoming registered agent as-is for compliance and privacy.

• Confirm your Colorado registration as a foreign LLC is current and in good standing.

• If you anticipate litigation, consider adding a venue clause to your operating agreement and major contracts specifying that all disputes will be governed by the laws and venue of either Wyoming or Colorado, depending on your preference for convenience or tax strategy.

Brandon

You are very welcome. I recommend that you copy it and email it to yourself.