Closing Your Business – What You Need to Know

Businesses close for many reasons, and business owners can understandably become overwhelmed with everything involved in winding up a company.

But, just as a legal filing is required to start your corporation or LLC, you must file a document with your state of jurisdiction to formally dissolve that entity.

Although you may believe it is easier to simply let the state administratively dissolve your company charter after a period of non-compliance with tax payments and filings, that strategy may result in even more problems, such as mounting penalties and fees and possible personal liability for judgments against the business. Even during a dissolution, corporate compliance saves you money. 

The right way to formally stop business-related obligations is to file a Dissolution with the state. By doing so, you will end your company’s existence in your state of incorporation. If your company is qualified to do business in other states, you should file a Withdrawal in those states as well.

Another consideration when winding up a business is the timing of the Dissolution filing. Delaware assesses taxes on all active charters annually on January 1.

While the tax and fees are not due until March for Corporations and June for LLC’s, the fees are assessed and due for every year the charter remains open, even if it is only for one day of that year. Therefore, it is prudent to get that Dissolution filing done by year-end if you have ceased operations.

If you’ve closed your business, our team at The Incorporators Ltd. can help you legally dissolve your business charter in Delaware. Just contact our office, and we will provide the appropriate document(s) and fees for your entity type, and submit your filing to the State via our direct access to the Delaware Corporate Information System, ensuring accurate and timely completion of your filing.

Please note: to ensure your dissolution is completed by year-end, our deadline for accepting 2018 dissolution requests is Friday, December 21.

If you have any questions about dissolving your business charter, give us a call at 800-223-3928 or contact us here.