HOW TO LEGALLY CLOSE A BUSINESS ONLINE
HOW TO DISSOLVE A BUSINESS ONLINE

Choose your Business Type then click on any state in the list below to find out How to Legally Close a Business in that state

A Corporation or Limited Liability Company (LLC) is created when the Secretary of State, or other state agency, approves formation documents - usually called Articles of Incorporation for Corporations or Articles of Organization for LLCs.  A record of the Corporation or LLC is added to the list of Companies which have officially registered with the state.  Once a Corporation or LLC is registered with the state, that Company immediately has both reporting and tax obligations which incur penalties if the obligations are not met by the required deadlines. 

If you've registered a Corporation or LLC with the Secretary of State, or other state agency, and want to cease Business activities you have to let the Secretary of State, or other state agency, know that you intend to close your company.  Only after the Secretary of State, or other state agency, has made sure that all of the obligations of the Corporation or LLC have been fulfilled will the state legally approve of the closure of the company.

When the Secretary of State, or other state agency approves the closing of a Corporation or LLC, that Corporation or LLC is said to be Dissolved.   The process of Dissolving a Corporation or LLC is commonly called Business Dissolution.  Business Dissolution is also referred to as Business Cancellation or Business Termination.  Whatever it is called a Business that wants to legally cease Business Operations must legally close the Business with the state in which the Business was originally formed.

The state wants to make sure they get their due.  They will not approve the Dissolution of a Corporation or LLC until all outstanding administrative fees have been paid to the state.  Some states also require a certificate of approval from the state taxation department stating that all taxes have been paid.  These issues can add time and more fees to the Business Dissolution process.  The fees usually go up in proporton to how long a Corporation or LLC has not been in good standing with the state.  The total cost to Dissolve a Corporation or LLC varies depending on exactly what is required for each specific Business Dissolution.

As soon as a Corporation or LLC is registered with the Secretary of State, or other state agency, that Corporation or LLC is responsible for recurring obligations of the Secretary of State and the Department of Revenue or Taxation.  If the Corporation or LLC does not file reports or pay taxes then that Company could be responsible for penalties which go up as time goes by.

Unless you legally Dissolve your Corporation or LLC with the state that Corporation or LLC will be responsible for all recurring fees and penalties.

Corporation or LLC Dissolution is one part of a larger process commonly called the "Winding Up" process.  There are things you need to do before you can request approval of Corporation or LLC Dissolution from the state and things that you have to do after the state has approved Dissolution of the Corporation or LLC. 

What you have to do both before and after the Corporation or LLC is Dissolved largely depends on whether the Company has begun business and has any debts, assets or liabilities.

1. Hold a Meeting of Corporation Directors or LLC Members and record a resolution to Dissolve the Company
   
   If a Board of Directors has been appointed for the Corporation or if an LLC has Members then a vote should be taken on the matter of Business Dissolution.  The details of the meeting and results of the vote should be recorded and kept in the Company records. Some states require approval information be included on their Articles of Dissolution.
   We can transcribe and compile minutes or approvals into a form that is legally recognized in any state.
2. Hold a Shareholder or Member meeting to approve Dissolution of the Business
   
   If a Corporation has issued shares of stock then a majority of Corporate Shareholdres must approve the Dissolution plan. The details of the meeting and results of the vote should be recorded and kept in the Company records. Some states require approval information be included on their Articles of Dissolution.
   
   For Corporations, if no shares have been issued then no shareholder meeting needs to tak place.
   If necessary, we can transcribe and compile minutes into a form that is legally recognized in any state.
3. File all required Annual or Biennial reports with the Secretary of State or other state agency
   
   If your state has reporting requirements for a Corporation or LLC then you must be current in all required report filing before the state will approve Dissolution of your Businss.
   We can file any required Annual or Biennial report in any state.
4. Clear up any Business debts
   
   All creditors of a Corporation or LLC should be given notice of the pending Business Dissolution. Each creditor should be given a mailing address to which they may submit claims as well as a deadline by which claims may be submitted.
   
   Some states have legally required publication requirements.
5. Pay your Business Taxes
   
   In some states the Secretary of State, or other state agency, will not approve the Dissolution of a Company until that Company has fulfilled all its tax obligations with the state Department of Revenue.
   
   Some states require written documentation from the state tax agency in the form of a Tax Clearance Certificate prior to approval of Business Dissolution.  If a Tax Clearance Certificate is required before the Secretary of State will approve the Dissolution of a Company then that could add weeks to the Dissolution filing and review process.
6. File Dissolution documents with the Secretary of State or other state agency
   
   In most states Dissolution documents for a Corporation are called Articles of Dissolution and Dissolution documents for an LLC are called Articles of Cancellation or Articles of Termination.  Some states require that an Intent to Dissolve is submited before the Articles of Dissolution or Cancellation are accepted.  The information required on the Dissolution documents varies from state to state.
   We can prepare any Dissolution document and file it in any state.

1. Distribute all remaining assets of the Business
   
   If the Corporation or LLC has any remaining assets, these may be divided according to the Shareholdrers' or Members' ownership interests in the Dissolved Business. All distributions to Corporate Shareholders or LLC Members must be reported to the IRS.
2. Close all Business bank accounts of the Corporation or LLC
   
   If there are any Business accounts that have been opened for the Corporation or LLC then those accounts must be closed. If Company Business accounts are left open there may be liability and obligations of the Dissolved Corporation or LLC which could lead to legal problems.
3. Cancel all local Business licenses and permits
   
   If the Business has obtained any state, regional, county or city Business licenses or permits, each of those must be cancelled to avoid any reporting or fiscal obligations of the Corporation or LLC. This includes Business registration licenses as well as reseller permits.
4. File Form 966 with the IRS
   
   Dissolved Corporations or LLCs may be required to file IRS Form 966 with the US Internal Revenue Service (IRS).  If required, IRS Form 966 must be filed within 30 days after the final Dissolution plan is approved by the Company.  Filing IRS Form 966 lets the Federal Government know that the Corporation or LLC has been legally Dissolved so that it may take appropriate actions.
   
   
   We can prepare IRS Form 966 for you to file
5. Publish a Notice of Dissolution of the Company
   
   Publishing a Notice of Dissolution of a Corporation or LLC in a local newspaper is not a legal requirement in most states but it is one sure way of avoiding law suits should a creditor make a claim and say they were not informed of the Dissolution of the Compoany.
6. Keep Records of all Pertinent Business Documents
   
   In order to avoid problems down the line, you should keep copies of all tax filings, contracts and employment records on file as well as Certified Copies of all company documents filed with the Secretary of State.  This includes Formation Documents - Articles of Incorporation for Corporations and Articles of Organization for LLCs - and Dissolution douments.

You notify the IRS that your Business has been Closed on the final tax return that is filed for your Business. 

If you have employees and file taxes quarterly with IRS Form 941, Employers Quarterly Tax Return, check the appropriate box on that form to let the IRS know that your Business has Closed.  If you file yearly taxes do the same on IRS Form 944, Employers Yearly Tax Return. You should also attach a statement to the return showing the name of the person keeping the payroll records and the address where those records will be retained.

When you opened your Business you most likely were assigned a Federal Employer Identification Number (EIN).  Once the IRS links an EIN to a Business, that EIN stays with the Business even after the Company has been Dissolved.  If you don't plan to reopen your Business after it has been Closed, you should cancel the EIN account that has been assigned to your Company.

The time it takes to Dissolve a Corporation or LLC varies depending on how long it takes to complete the actions that are required in each specific case - holding meetings, closing accounts, distributing assets, etc.

If a Corporation or LLC has not started doing Business or does not have any assets then the time it takes to Dissolve a Business is usually a lot shorter than the time it takes for Corporations or LLCs which already have started doing Business and retain assets.

If delinquent taxes or annual report fees are due, this adds complexity, time and cost to the Dissolution process.  In some cases it can be difficult to verify the exact amount required to fulfill any delinquent taxes and fees until the state calculates the total cost during their review process.

Once the initial actions are completed the time it takes for the Secretary of State, or other state agency, to process a Business Dissolution filing varies depending on the specific state. Choose your state from the list above to get specific Business Dissolution timing information for that state.