A good rule of thumb is that if your company wants to have an office presence in a state other than its home state, it should either incorporate as a separate entity or qualify to do business as a "foreign" (meaning, out-of-state) corporation. In other words, if your "Gifts of Ohio, Inc." company wants to open a store in neighboring Indiana, it can either form a brand-new corporation in Indiana, or tell the Indiana Secretary of State that "Gifts of Ohio, Inc." wants to do business there. However, if by "expand" you simply mean solicit customers from out-of-state, you may not need to incorporate in that other state. However, you may be responsible for paying taxes in that other state. Best to check with an accountant who is familiar with these issues, as the tax and expense of doing multi-state business could adversely affect your bottom line.
Nina L. Kaufman, Esq. is an award-winning New York City attorney, edutainer and author. Under her Ask The Business Lawyer brand, she reaches thousands of entrepreneurs and small business owners with her legal services, professional speaking, information products, and LexAppeal weekly ezine. She also writes the Making It Legal blog.