A Certificate of Good Standing is a brief document issued by a state government agency that certifies a business entity as validly existing and legally authorized to conduct normal operations within the state. To obtain a Certificate of Good Standing, a business entity generally needs to be up to date on all required fees and filings, such as annual reports and business license renewals.
Every state issues some form of a Certificate of Good Standing, but the exact name depends on locality. There are many alternative names for a Certificate of Good Standing, such as:
- Certificate of Existence
- Certificate of Authorization
- Certificate of Status
- Certificate of Compliance
- Certificate of Fact
- Certificate of Registration
All these names refer to the same type of document. Under any name, it has the same significance: It verifies that a particular business was established in compliance with state laws and remains a legally functioning entity.
A business owner is not required to have a Certificate of Good Standing in order to remain compliant with the law. It is not a business license or permit. Nonetheless, there are certain types of important business transactions where a business entity is expected to produce a valid Certificate of Good Standing—and the following infographic from FastFilings touches on some of the more frequently encountered occasions.
It’s certainly a sound business practice to have a Certificate of Good Standing in your files. Bear in mind, however, that it is commonplace for the other party to request a certificate that has been printed recently (e.g., within the past 30 or 60 days). Even if you already have a certificate on hand, it may be necessary to get a new one.
How to Get a Certificate of Good Standing
FastFilings offers the easiest way for businesses to obtain a recent Certificate of Good Standing. Although it’s always possible to order a certificate from the relevant state agency, FastFilings has streamlined the process to remove all the worry and hassle of dealing with the government. There’s no easier way to apply for a Certificate of Good Standing from the state.
Keep reading for information on business scenarios where a Certificate of Good Standing might come into play.
