What is California LLC Dissolution? |
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A California LLC is created when the CA Secretary of State approves the Articles of Organization.
A record of the California LLC is added to the list of LLCs which have officially registered with
the California Secretary of State.
Once a LLC is registered with the California Secretary of State, that LLC immediately has both reporting and tax
obligations which incur penalties if the obligations are not met by the required deadlines.
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A California LLC is created when the CA Secretary of State approves the Articles of Organization.
A record of the California LLC is added to the list of LLCs which have officially registered with
the California Secretary of State.
Once a LLC is registered with the California Secretary of State, that LLC immediately has both reporting and tax
obligations which incur penalties if the obligations are not met by the required deadlines.
If you've registered a California LLC with the California Secretary of State and want to cease business activities
you have to let the CA Secretary of State know that you intend to close your company.
Only after the CA Secretary of State has made sure that all of the obligations of the California LLC have been fulfilled will
the Secretary of State approve of the closure of the company.
When the California Secretary of State approves the closing of a CA LLC, that California LLC is said to be
Dissolved.
The process of Dissolving a California LLC is called California LLC Dissolution.
Dissolution documents for a California Limited Liability Company cannot be filed with the CA Secretary of State if the California LLC has been suspended by the California Franchise Tax Board (California FTB).
Upon the effective date of the Certificate of Cancellation of the California LLC by the California Secretary of State, the Articles of Organization of the California Limited Liability Company will be cancelled and the powers, rights and privileges of the CA LLC will cease in the state of California.
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Why do I need to Dissolve a California LLC? |
As soon as a California LLC is registered with the CA Secretary of State, that LLC is responsible for
recurring obligations of the California Secretary of State and the California Franchise Tax Board.
If the California LLC does not file reports or pay taxes then that CA Limited Liability Company could be responsible for
penalties which go up as time goes by.
Unless you Dissolve your California LLC with the California Secretary of State that CA Limited Liability Company will be responsible for
all recurring fees and penalties.
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What do I have to do to Dissolve a California LLC? |
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California LLC Dissolution is one part of a larger process commonly called the "Winding Up" process.
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California LLC Dissolution is one part of a larger process commonly called the "Winding Up" process.
There are things you need to do before you can request approval of LLC Dissolution from the California Secretary of State;
and things that you have to do after the CA Secretary of State has approved Dissolution of the California LLC.
What you have to do both before and after the California LLC is Dissolved largely depends on if the California LLC has commenced business
and how many assets, debts and liabilities, if any, that the CA Limited Liabilty Company has.
If the California LLC has not commenced business then the CA Limited Liability Company Dissolution process is easier.
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What do I have to do before I Dissolve a California LLC? |
Things you need to do before you Dissolve a California LLC.
1. Hold a Members meeting and record a resolution to Dissolve the California LLC
2. File a Certificate of Cancellation with the CA Secretary of State
3. File all required Biennial Statement of Informations with the California Secretary of State
4. File all required tax returns with the California Franchise Tax Board
5. Clear up any business debt
6. Pay all taxes and administrative fees owed by the California LLC
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1. Hold a Members meeting and record a resolution to Dissolve the California LLC
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If the California LLC has any Members then a meeting should be held and a vote to Dissolve the California Limited Liability Company taken.
Minutes of the meeting should be recorded and retained in the business records.
If the California LLC does not have any Members then the Organizer(s) have to apply for Dissolution of the California LLC.
- We can transcribe and compile minutes or approvals into a form that is legally recognized by the California Secretary of State.
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2. File a Certificate of Cancellation with the CA Secretary of State
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The Statement of Intent to Dissolve must be filed with the California Secretary of State before
initiating the final stages of the California LLC Dissolution process.
- We can prepare your Certificate of Cancellation and file it with the CA Secretary of State.
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3. File all required Biennial Statement of Informations with the California Secretary of State
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The California Secretary of State will not approve the Dissolution of a CA LLC until all required
reports have been filed.
- We can file any required Biennial Statement of Information with the CA Secretary of State.
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4. File all required tax returns with the California Franchise Tax Board
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The California Secretary of State will not approve the Dissolution of any CA LLC until that LLC has
fulfilled all its tax obligations with the California Franchise Tax Board.
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5. Clear up any business debts
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All creditors of a California LLC should be given notice of the pending LLC Dissolution.
Each creditor should be given a mailing address to which they may submit claims as well as a deadline by which claims may
be submitted.
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6. Pay all taxes and administrative fees owed by the California LLC
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The California Secretary of State will definitely not approve the Dissolution of a California LLC until all
outstanding taxes and applicable registration and administrative fees have been paid.
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What do I have to do after I Dissolve a California LLC? |
Things you have to do after you Incorporate in California.
1. Distribute all remaining assets of the California LLC
2. Close all business bank accounts of the California LLC
3. Cancel all local business licenses and permits
4. File Form 966 with the IRS
5. Cancel the IRS account associated with the CA LLC's Federal Tax ID (EIN)
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1. Distribute all remaining assets of the California LLC
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If the California LLC has any remaining assets, these may be divided according to the Members' ownership interests
in the CA Limited Liability Company.
All distributions to LLC Members must be reported to the IRS.
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2. Close all business bank accounts of the California LLC
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If there are any business accounts that have been opened for the California LLC then those accounts must be closed.
If Company Business accounts are left open there may be liability and obligations of the Dissolved California LLC which could
lead to legal problems down the line.
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3. Cancel all local business licenses and permits of the CA LLC
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If the California LLC has obtained any state, regional, county or city business licenses or permits, each
of those must be cancelled to avoid any reporting or fiscal obligations of the California LLC.
This includes business registration licenses as well as reseller permits.
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4. File IRS Form 966
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Most Dissolved California LLCs must file IRS Form 966 with the US Internal Revenue Service.
If a California LLC is required to file IRS Form 966, the filing is required within 30 days after the final Dissolution
plan is approved.
Filing IRS Form 966 lets the Federal Government know that the California LLC has been legally Dissolved
so that it may take the appropriate actions.
- We can prepare IRS Form 966 for you to file.
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5. Cancel the IRS account associated with the CA LLC's Federal Tax ID (EIN)
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A Federal Tax ID, or Federal Employer Identification Number (EIN), is like the Social Security Number for the California LLC.
Once the IRS links an EIN to a California LLC, that EIN stays with the California LLC even after the Company has been Dissolved by the
California Secretary of State.
When the IRS processes the final tax return for the California LLC, they automatically make the EIN inactive.
However, the account associated with the EIN is not automatically closed.
Closing the account associated with the EIN lessens the likelihood of any problems with the EIN account, or with the IRS, in the future.
If you should decide to revivie the California LLC down the line then the IRS will reactivate the old EIN for your new Business.
Before a California LLC can close an EIN account, it must be in Good Standing with the IRS.
The California LLC must have filed all required tax returns and paid any applicable fees and penalties due to the IRS.
The California LLC cannot close its EIN account until the IRS has received payment for any tax amounts the Company may owe.
- We can prepare the formal documents which you can sign and submit to the IRS in order to close the account
associated with your EIN.
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How long does it take to Dissolve a California LLC? |
The time it takes to Dissolve a California LLC varies depending on how long it takes to complete the actions that are
required in each specific case - holding meetings, closing accounts, distributing assets, etc.
Once the initial actions are completed, the California Secretary of State usually takes around 5-7 business days to process the Certificate of Dissolution.
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The time it takes to Dissolve a California LLC varies depending on how long it takes to complete the actions that are
required in each specific case - holding meetings, closing accounts, distributing assets, etc.
The California Secretary of State requires a Tax Clearance Certificate from the CA Franchise Tax Board before it will aprove the
Dissolution of a California LLC.
The time it takes the CA Franchise Tax Board to process a request for a Tax Clearance Certificate depends on the tax status of the
California LLC.
In some cases it could take 5-6 weeks to get a Tax Clearance Certificate from the California Franchise Tax Board.
Once the initial actions are completed, the California Secretary of State usually takes around 5-7 business days to process the Certificate of Dissolution.
Processing times for California LLC Dissolution filings vary depending on the work load of the
Secretary of State's staff.
We've found that normal processing of California Dissolution filings takes the state around 5-7 business days.
PLEASE NOTE: WE CANNOT GUARANTEE CALIFORNIA SECRETARY OF STATE OR CALIFORNIA FRANCHISE TAX BOARD PROCESSING TIMES.
We are dependent on, and have no control over, the staff and systems of the California Secretary of State or California Franchise Tax Board.
In our experience 5-7 business days is the time it usually takes the California
Secretary of State to process a California Dissolution filing.
We get your California LLC Dissolution filing to the CA Secretary of State ASAP.
Once it is at the state we have no control over the California Dissolution approval process.
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How much does it cost to Dissolve a LLC in California? |
The total cost to Dissolve a California LLC varies depending on exactly what is required for each specific
CA Dissolution.
We charge $224.00 plus any state fees for our California LLC Dissolution services. This includes:
- Same day processing
- Transcribe minutes of Members meeting which proposes Dissolution
- Prepare and file Certificate of Dissolution with the California Secretary of State
- Prepare US IRS Form 966 for you to sign and file
- Prepare documents to cancel Federal EIN account
- Certified copy of Dissolution filing from CA Secretary of State
- Priority Mail Delivery of all documents
- Unlimited Customer Support
We also offer these California LLC Dissolution services separately as explained on the right side of this web page.
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What do I have to do if I want to Dissolve a Foreign LLC that is tied to a CA Domestic LLC? |
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If there are Foreign LLCs in states other than California that are tied to the Domestic California LLC then
each of those Foreign LLCs must be Dissolved before the California LLC is legally Dissolved.
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How long before someone can use my LLC name in California after I Dissolve? |
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A California Limited Liability company name becomes available for anyone to use when the California LLC is Dissolved by the California Secretary of State.
There are no LLC company name protections in California once a California LLC has been Dissolved by the California Secretary of State.
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Do I have to publish a Notice of Dissolution of the California LLC? |
There are no state of California requirements for the publication of a Notice of Dissolution of a California LLC.
While the California Secretary of State does not legally require the publication of a Notice of Dissolution of a California LLC, publication is
a good way to notify anyone who might have a claim against the California LLC.
Evidence of publication might prove useful down the line if someone makes a claim against the CA Limited Liability Company after
the California LLC has been dissolved.
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