2022 AEC Business Compliance Checklist

Posted on: 01/10/22
Written by: Harbor Compliance

This message is brought to you by our partners at Harbor Compliance, providing expert services and purpose-built software so you can take government licensing requirements in stride. Their complete solution for entity management, business licensing, and tax registration makes it easy to enter new jurisdictions and maintain your existing presence. Learn more.

As we start another new year, it is an excellent time to verify your architecture, engineering and construction business’s licensing requirements and overall compliance.

To ensure you stay on top of your regulatory compliance requirements, Harbor Compliance can help. If you are unaware of your current entity status, Harbor Compliance provides a free nationwide compliance analysis and report as part of our AEC Entity and Licensing Healthcheck. This automated report confirms the information currently on file with state agencies to allow correction of records if they are not up to date. Contact us to help you.

Let’s start by looking at some of the most significant compliance changes businesses can expect in 2022.

2022 Business Impacts to Compliance
Amid the ongoing pandemic, we have seen a number of new compliance-related laws and regulations, some of which are now expiring. From workplace changes to changes revolving around data collection and subsequent analysis, it is often challenging to remain abreast of the latest legal and industry changes affecting your business.

In 2022, architecture, engineering, and construction businesses (AEC) expect significant opportunities to come from the passing of the Infrastructure Investment and Jobs Act (IIJA). You will likely have to navigate changing regulatory compliance requirements and regulations arising from vaccine testing and mandated changes, health insurance requirements, the Employee Retirement Income Security Act (ERISA), and potentially the Build Back Better Act (BBBA).

To prepare for all these impacts in 2022, forward-thinking firms should be examining their current process to maintain compliance, and plan for expansion into new states for new work. Opportunities in new states involve fulfilling all business registrations and licensing requirements in new foreign jurisdictions (out of state, not out of the country), and can take months to secure.

General State Compliance
A number of elements go into ensuring your business complies with state regulations, which may have changed. For a prosperous new year, you need to research, confirm and update your compliance for each state in which you operate. The following aspects of your compliance profile are covered in-depth below:

  • State Registration Updates - expansions or withdrawals from states where you do business

  • Registered agent status

  • Annual reporting requirements

  • Tax registrations and payments

  • Update corporate records - new contacts, etc.

State Registration Updates

Your company needs to be registered in all states in which you conduct business. Business owners, managers, and advisors need to be aware of registration requirements in the different states where they operate. Whether you work in one state or multiple states, you need to ensure compliance by confirming or renewing your registration status. Ensuring good standing is a foundational step in the process of applying for and renewing firm licensing to operate in that state. Specific secretary of state requirements include:

  • Ensuring good standing with each state’s secretary of state - check that all required filings are up-to-date, and upcoming deadlines

  • Foreign qualifying in states outside your domicile, where you conduct business or plan to conduct business in 2022

  • Rectifying delinquent statuses

  • Closing registrations from states in which you are inactive

New Jurisdictions
If you have recently purchased new property, hired employees, opened offices, or conducted business activities in new states, you need to foreign qualify in states outside your domicile. You may need to obtain a certificate of authority, become licensed in new jurisdictions and register for taxes.

Terminated Registrations
If you have reduced your business’s footprint, you may need to terminate registrations and withdrawal if you do not plan to maintain a presence in a state. Remember that your obligations to the state continue until you have officially withdrawn. Even if your business is in good standing in the other states you operate in, failing to properly terminate your registration could result in significant penalties.

Registered Agent Appointment
A key element of maintaining good standing as a business is having a registered agent service. Registered agents provide critical notice of lawsuits against your business. To ensure registered agent compliance:

  • Appoint a registered agent in states where you conduct business

  • Verify registered agent addresses are current

  • Consider consolidating registered agent services into a single provider

If you are uncertain who is acting as your registered agent or if you are receiving the level of service you expected and need, Harbor Compliance can help. We can confirm your registered agent status for you. If you need a registered agent, we provide nationwide service.

Annual Reports
Businesses in most states must file annual reports that include basic information about their organization. Deadlines vary, so it is easy to lose track of them. To ensure annual report compliance:

  • Determine which states you need to file annual reports for the upcoming year

  • Know your filing deadlines

  • Budget for statutory fees

If you are looking to outsource your annual report filings, we can help. At Harbor Compliance, we provide fully managed annual report services. We can ensure your reports are filed on time while eliminating the filing workload from your duties.

Firm and Individual Licensing
Every year, business owners and managers need to audit their company's license portfolio. Renewals need to be submitted on the required basis. If the qualifying engineer or responsible party changes, the states need to be notified quickly.Professional licensing also requires continuing education. Tracking those credits is key. To ensure licensing compliance:

  • Review your company's current licenses status in each state

  • Review your professional licenses in each state, including updates to qualifying engineers or responsible parties

  • Evaluate the need for new business and individual licenses to operate in new states

  • Track professional licensing continuing education certifications

  • Submit the necessary documentation to each state licensing authority

At Harbor Compliance, our AEC-specific business licensing solutions help simplify and provide transparency to the new license acquisition, renewals, and lifecycle management process. Our web-based software and fully managed business licensing solutions can ensure your AEC professional licenses align with your present and future business activities.

Tax Obligations
Your tax obligations become more complex as your business grows and expands into new states or hires new employees. To ensure compliance:

  • Verify where you have a tax nexus with your CPA or accounting professional

  • Submit tax registrations to file returns and pay taxes, including
    ○ Sales and remote seller tax
    ○ Payroll taxes
    ○ Corporate income and franchise tax
    ○ Other product- or industry-specific taxes

  • Retain all financial records to ensure your accountant has accurate records for each entity

Our specialists can assist with registering you for sales tax, corporate income tax, franchise tax and payroll taxes across the United States.


Corporate Records Update

Your corporate records have likely changed if your business has evolved over the past year. To ensure compliance, notify applicable state agencies when corporate records have changed. Specifically, verify the state has the latest contact information (new addresses, contact names, etc.) regarding changes in owners and officers, and changes to responsible parties and qualifying engineers. Failure to notify the proper authorities of changes to your corporate records could result in loss of good standing or forfeiture of licenses. 

Confirm Regulatory Compliance Requirements With Harbor Compliance

If you need help with the compliance aspects of your business, please get in touch with us. To gain clarity into your nationwide registrations ask for a free nationwide AEC Entity and Licensing Healthcheck. Our specialists have helped thousands of companies with their compliance needs at all phases of the corporate lifecycle. Let us help you enjoy a prosperous new year.

© 2021-2022 Harbor Compliance. All rights reserved.

Harbor Compliance does not provide tax, financial, or legal advice. Use of our services does not create an attorney-client relationship. Harbor Compliance is not acting as your attorney and does not review information you provide to us for legal accuracy or sufficiency

 

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