How to Dissolve your LLC
As an owner of a business you may be faced with the decision of closing the doors of your business for good. When it comes time to dissolve your LLC (Limited Liability Company) you need to know the proper steps that need to be taken. By consulting with the lawyers at Robinson, Seiler & Anderson Law Firm in Provo, Utah you can know exactly what you need to do when it comes to dissolving your LLC.
Close the Business
The first step to dissolving and LLC is to, of course, close the business. If you are the sole proprietor of the business then you will find this step fairly easy to accomplish. If you have a partner in your business then you will need to inform your business partner of the closer. If you drafted a written partnership agreement, you will need to follow the rules of dissolution contained in the partnership agreement, articles of incorporation, or state laws. Typically, such agreements contain clauses that require a two-thirds or majority vote in order to dissolve the business.
File with the State
All limited and general partnerships that filed with the state at the creation of the partnership must file dissolution papers with the state. Even if your partnership isn't required to file paperwork with the state, it's always a good idea to do so. By filing dissolution papers with the state, you place creditors on notice that the business cannot incur any further business debt. Filing a Certificate of Dissolution (also known as Articles of Dissolution) is a process that varies from state to state. In some states, filing this certificate must be done before notifying creditors, while in other states you must notify creditors first. In either case, creditors' claims must be resolved in some fashion— either by payment in full, a compromise with them, or bankruptcy.
Notify the IRS
When closing your business you need to know that your business will still require the payment of taxes for the current and prior year. You'll also be responsible for all final tax forms that need to be filed. This includes income tax, any sales tax that has been collected, and payroll taxes. The IRS has a comprehensive checklist for business owners who are preparing to shut down. The checklist contains forms that must be filled out or continued to be filed as the business shuts down. Consulting with your lawyer at Robinson, Seiler & Anderson Law Firm in Provo, Utah is necessary when it comes to making sure all of the documents you need to dissolve your LLC are in place.