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Dissolve your solution

Dissolve your solution

What is Business Dissolution?

Dissolving a business means legally terminating its existence. This could happen for a variety of reasons, such as the business being no longer profitable, a change in direction, or shareholders deciding to divide assets. Regardless of the reason, it’s crucial to follow the correct procedures to avoid lingering tax and legal responsibilities. Filing for dissolution informs the state, creditors, employees, customers, and other stakeholders that your business is closing. For most businesses, except sole proprietorships, filing dissolution paperwork is mandatory.

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What Steps Do You
Need to Take Before
Filing Articles of Dissolution?

Before officially dissolving your business, consider the following steps:

Hold a Vote to Dissolve (if required)

If your bylaws or operating agreement require a vote, meet with the board of directors or partners to approve the dissolution.

Notify Creditors and Customers

Settle any outstanding debts and accepted claims. Inform creditors about the deadline for submitting final claims, and collect any outstanding payments from customers.

Settle State Taxes

Pay any outstanding state and local taxes and ensure all tax obligations are met.

Pay IRS Taxes

File your final tax return with the IRS, report any capital gains, and close your Employer Identification Number (EIN) account.

Notify Employees

Pay any final wages, settle payroll tax liabilities, and file your last employment tax return.

Cancel Licenses and Permits

Cancel all business licenses and permits, and deregister any DBAs.

Final Step-File Articles of Dissolution

After completing all necessary steps, and ensuring your business is in “good standing” (i.e., no outstanding franchise taxes or overdue reports), you can file Articles of Dissolution with the state.

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