Dissolving a corporation can be a time-consuming task, but it can be done on your own. After making the decision by a vote of all shareholders, you must begin the task of filing forms with the government and selling assets to pay off creditors. In no time the corporation will be dissolved, and you can move on to your next endeavor.
Things You'll Need
- IRS form 966
- Articles of Dissolution
Conduct a meeting of the board of directors and vote on the dissolution. Some states require a 2/3 majority, while most accept a majority over 1/2. Record minutes from this meeting, that include the action plan for dissolution, to be stored in the corporate book.
File form 966 with the IRS within 30 days of the meeting. Use the instructions included with the form to complete it. Certain states may require you to file a Statement of Intent to Dissolve with the Secretary of State's office as well.
Notify creditors of your intent to dissolve and request that they submit a claim, and what you want included in the claim. Pay or reject all claims in writing, by the due date given in the notice. In most cases you will have to sell assets to pay the creditors. Some states require a tax clearance prior to dissolution.
Sell and distribute any remaining assets to the shareholders. These will be distributed per the percentage of ownership each shareholder owns.
File the Articles of Dissolution form with your state. You can find the specific form for your state on the Secretary of State's website. Keep a copy of the form in your corporate records.
Tips & Warnings
- Several fee-based websites will help you complete and file the forms for you.
- Dissolving a corporation could have major legal impact and tax consequences. Seek the help of a corporate attorney and tax accountant.
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