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What is Dissolution?
When a corporation or LLC dissolves, it legally ends its existence. This might happen because the business is no longer profitable, you're ready for a new chapter, or shareholders want to divide assets. Whatever the reason, it's important to follow the right steps to avoid ongoing tax and legal responsibilities.
Avoid Unnecessary Fees and Taxes by Filing Dissolution
In order to properly close a corporation or LLC that is no longer transacting business, the company must file Articles of Dissolution with the state of incorporation. Neglecting to file Articles of Dissolution for a company that is no longer active may expose the corporation or LLC to unnecessary recurring fees or taxes.
Steps to Dissolving Your LLC or Corporation
There are three key steps to dissolving a company. Cokion completes these steps in a timely manner on your behalf, making an otherwise cumbersome process simple and stress-free.
Hold a meeting with the Board of Directors
File the Articles of Dissolution
Notify the IRS
Save your time.
Requirements to file Articles of DissolutionStep 1 : Hold a meeting with the Board of Directors
In this case, you want the minutes of your meeting to reflect that a vote was taken and appropriate majority (as outlined in your incorporation papers) was achieved. Those companies with shareholders will want a written documentation of this decision signed by all company owners. Some companies, such as single-member LLCs will not need to complete this step.
Step 2 : File the Articles of Dissolution
Next, your company will need an Assumed Name under which to register, or you can incorporate your business and use your formal name.
Step 3 : Notify the IRS
Then, if you operate from home or plan to remodel a space, for example, you'll need to obtain permits to do so. Other permits covering serving alcohol, displaying a sign on the building exterior and even parking for your business might also be a requirement. A great place to research your local zoning and operating laws is the nearest Small Business Development Center (SBDC).
An additional step often recommended at this point is the closing of all credit lines and accounts that pertain to your business. Letting your creditors know that you have dissolved a company will set you up for more favorable circumstances should debt still be present. Finally, if you have any fictitious names in other states, you'll want to cancel those as well.
Step 4 : Save your time
We'll handle the paperwork.
Step 5 : Requirements to file Articles of Dissolution
The company must be in good standing with the state of incorporation and cannot be in arrears of franchise taxes or annual reporting requirements. In the event that the entity is not in good standing reinstatement would be required in order to proceed with the dissolution.
Common questions on filing Dissolution
The articles formalize the cessation of activity as an incorporated entity. They define parameters surrounding the dissolution of a company. This could include the distribution or sale of assets, how shareholders will be compensated and responsibilities divided among management.
The state fee varies by state our service fee to file Articles of Dissolution is $149. To review the fee in your state click on the "order now" button and select the state and entity type.
The only stipulation that would prohibit the owners of an entity from filing a dissolution is if the company owes outstanding taxes or has annual reports outstanding. In this event the company would need to bring the itself to good standing with the state before filing the dissolution.
The filing time is dependent on the governing state agency and varies by state.
The governing state agency will return a copy of the filed articles which are then mailed to the client.
Providing Everything You Need When You Need It
As your business evolves, we'll be there every step of the way to make sure that you have the resources at hand to service your companies ongoing needs.
Dissolution
Used to formally terminate the existance of an entity.
Business Formation
Start an LLC, S Corp, C Corp, or nonprofit here.
DBA
File if your company requires an assumed business or fictitious name.
Foreign Qualification
Filed when you need to expand your entity to new states.
Get Reinstated
Get your business back up and running after dissolution.
Virtual Address
Protect your privacy, secure a street address for your biz, and check your mail from anywhere.
Amendment
File if a company requires changes to membership, addresses, or company name.