While most of the articles we post on Registered Agent Ready pertain to the startup and maintenance of American business entities, the business world isn’t always a happy place.
Sometimes, your business venture doesn’t go quite as planned, and it becomes clear that it’s time to close up shop. Dissolving a limited liability company can be a stressful endeavor, and it’s important that you complete each step of the dissolution process correctly if you want to close your business in compliant fashion.
We’ve gotten quite a few questions from our readers regarding the appropriate way to dissolve an LLC, and today we’ll examine all the details of this process.
What exactly is included in this process? What are the penalties for failing to dissolve an LLC correctly? In this article, we’ll discuss all of these topics and more, as we dive into all the relevant details of dissolving an LLC in all 50 states.
Need Help Dissolving an LLC?
The same services that can form an LLC will also dissolve an LLC. Save time and hassle by hiring them to deal with the state responsibilities for you. See our review for our comprehensive comparison review.
What Does Dissolution Mean for an LLC?
If you want to permanently shut down your business operations, you’ll need to formally dissolve your limited liability company with the state government.
This includes preparing and filing dissolution paperwork with your state, as well as liquidating the assets of your LLC, settling any outstanding liabilities, and providing legal notifications to any individuals and/or business entities that do business with your company.
It’s important that you complete each of these steps exactly as you’re supposed to, because failing to do so could lead to you as the LLC’s owner being held liable on a personal level for the debts and other liabilities of the LLC. Or, other frustrating issues like the LLC getting sued.
Once your LLC has been dissolved, you will no longer have to pay maintenance fees with your state, and you’ll be done with annual reports and franchise taxes too. Most importantly, completing the formal dissolution process provides protection against lawsuits down the line.
Steps Involved With Dissolving an LLC
Every limited liability company should include internal procedures for dissolving the company in its operating agreement. Usually, the procedure to dissolve an LLC involves every owner of a multi-member LLC voting whether to enter the dissolution process or not. Once the votes are in, and dissolution has been agreed upon, you should draft a resolution to keep with the rest of your LLC’s documentation ― this is not usually a legally required step, but it can help you avoid problems after your business is closed.
The next step for dissolving an LLC is to inform your creditors that you will no longer be conducting business with your limited liability company. Each state specifies its own deadline for creditors to submit a claim to a dissolved LLC, which is typically between three months and six months.
You will also need to check with your local (municipal and/or county) and state tax boards to see if your business owes any tax money to these entities. In addition, you should cancel any licenses and permits your LLC used to operate in your state.
How to Dissolve an LLC in All 50 States
Each state has its own process for the formal dissolution of a limited liability company, so we figured it would be a good idea to provide links to the articles of dissolution in all 50 states. Simply scroll down to find your state, click the link for the relevant entity type (domestic or foreign), and you’re on your way to a compliant dissolution.
- Alabama – Domestic | Foreign
- Alaska – Domestic | Foreign
- Arizona – Domestic | Foreign
- Arkansas – Domestic | Foreign
- California – Domestic | Foreign
- Colorado – Domestic | Foreign
- Connecticut – Domestic | Foreign
- Delaware – Domestic | Foreign
- Florida – Domestic | Foreign
- Georgia – Domestic | Foreign
- Hawaii – Domestic | Foreign
- Idaho – Domestic | Foreign
- Illinois – Domestic | Foreign
- Indiana – Domestic | Foreign
- Iowa – Domestic | Foreign
- Kansas – Domestic | Foreign
- Kentucky – Domestic | Foreign
- Louisiana – Domestic | Foreign
- Maine – Domestic | Foreign
- Maryland – Domestic | Foreign
- Massachusetts – Domestic | Foreign
- Michigan – Domestic | Foreign
- Minnesota – Domestic | Foreign
- Mississippi – Domestic | Foreign
- Missouri – Domestic | Foreign
- Montana – Domestic | Foreign
- Nebraska – Domestic | Foreign
- Nevada – Domestic | Foreign
- New Hampshire – Domestic | Foreign
- New Jersey – Domestic | Foreign
- New Mexico – Domestic | Foreign
- New York – Domestic | Foreign
- North Carolina – Domestic | Foreign
- North Dakota – Domestic | Foreign
- Ohio – Domestic | Foreign
- Oklahoma – Domestic | Foreign
- Oregon – Domestic | Foreign
- Pennsylvania – Domestic | Foreign
- Rhode Island – Domestic | Foreign
- South Carolina – Domestic | Foreign
- South Dakota – Domestic | Foreign
- Tennessee – Domestic | Foreign
- Texas – Domestic | Foreign
- Utah – Domestic | Foreign
- Vermont – Domestic | Foreign
- Virginia – Domestic | Foreign
- Washington – Domestic | Foreign
- West Virginia – Domestic | Foreign
- Wisconsin – Domestic | Foreign
- Wyoming – Domestic | Foreign
Should You Hire Someone to Dissolve Your LLC?
If you don’t want to DIY your dissolution, you do have some options. Some entrepreneurs choose to hire a business attorney to dissolve their limited liability companies, which does give you the confidence that every step was completed correctly. However, an attorney’s fees can be very expensive, especially for a company that’s going out of business.
Another option is to hire an online business services company to dissolve your LLC. With these companies (which are best known for forming LLCs) you can save a significant amount of money compared to hiring an attorney while still getting professional assistance with your dissolution.
The dissolution process for a limited liability company isn’t a terribly complex endeavor, but it’s one that you must make sure to complete correctly. If you don’t properly dissolve your LLC, you could be subject to some steep fines and other penalties.
We hope this article helped you improve your understanding of the dissolution process for LLCs, and we thank you for choosing Registered Agent Ready!