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.