How to Close an LLC Business
If you run a business that's classified as an LLC, at some point you may need to close it. Closing an LLC, otherwise known as dissolving the business, is not difficult, but there are a few things you are required to do.
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Things You'll Need
- List of assets
- List of debts
- Net worth
- Articles of Dissolution document
Instructions
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1
File a document called Articles of Dissolution or Certificate of Dissolution with your state's Department of Revenue or Secretary of State's office. This document is usually available on your state's website, and there is typically a small fee required.
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2
Pay off any debt the LLC owes. This includes paying vendors, employees and any outstanding loans. If there is not enough money to pay off all loans, you should consult an attorney.
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Notify all clients and vendors that you will no longer be conducting business.
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Return the LLC's cash reserves to the owners. If there is no money left or if there is not enough money to return everyone's investment, you will need to reach an agreement on how the money will be divided. Consult a lawyer, who will assist you in mediation as well as draw up any necessary paperwork.
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Notify the IRS that the LLC is no longer in operation by shutting down the Employer Identification Number (EIN) through the IRS website.
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Contact the county in which the business is located and cancel your business license. Do not just let it expire because you might be assessed additional fees or taxes even though your business is no longer in operation.
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File the proper paperwork with the Internal Revenue Service to report final paychecks, retirement and pension plan funds (see Resources).
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Report the sale of any assets, buildings, property or office equipment to the IRS (see Resources).
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File that year's tax return. When you do so, make sure to mark the box that says "Last Tax Return."
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References
Resources
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Comments
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lisa0507
Jun 28, 2010
Our supplier is dissolving his LLC business. He told us to hold off on paying our invoices. Will we still need to pay these? If so, to who and when? Thank you
