RASi Prepares and Files Dissolution and Withdrawal Documents for All Entity Types
We are very familiar with state guidelines and filing requirements. RASi can help you through each step of the dissolution process with the state agency, including getting tax clearance and/or filing final annual reports.

Entity dissolution

We handle the Articles of Dissolution/Cancellation in your formation state, obtaining any required tax clearances and ensuring all final reports are filed so your company is properly terminated.

State withdrawals

If you registered in other states, RASi files Certificates of Withdrawal (Surrender) in each jurisdiction, officially ending your authority to do business there and stopping ongoing obligations.

End liability

By formally dissolving or withdrawing, you avoid accumulating unwanted taxes, annual report fees, and registered agent requirements. RASi’s expertise makes this process smooth and compliant.

Dissolutions/cancellations

If a company ceases to conduct business, it must take formal steps to file the appropriate paperwork to terminate the business, as it did when establishing the business. If a company ceases to do business, but does not complete the necessary steps and does not file the appropriate paperwork, then that company will remain responsible for statutory requirements, state fees, annual reports, entity taxes, and must maintain a registered agent until it has completed and filed the official documents to terminate the company. The benefits of incorporating a company can be great, but the associated responsibilities and legal requirements remain until the proper steps are taken to legally terminate a company.

When a company wishes to terminate its business, it must file a document referred to as the "Articles of Dissolution" or "Certificate of Dissolution" or "Certificate of Cancellation". This document is filed in the domestic state, the state in which the company was originally incorporated/formed. In many states, the company must be in good legal standing before the state will accept this final corporate filing. This most often means that the company's compliance matters must be up to date, including outstanding taxes (some states require a Tax Clearance), outstanding annual reports, and any related filing fees for dissolution.

Withdrawals/surrenders

If a company is registered in foreign states and wishes to terminate its authority to transact business in those states, the company must also take formal steps to legally withdraw or surrender its authority to transact business in those states. In each state it wishes to cease doing business, the company must file a "Certificate of Withdrawal" also referred to as a "Certificate of Surrender". In many states, the company must be in good legal standing before the state will accept this final corporate filing. This most often means that the company's compliance matters must be current including outstanding taxes (some states require a Tax Clearance), outstanding annual reports, and any related filing fees to the withdrawal or surrender must be paid.

In any state, whether it's the company's domestic state or a foreign state, if the company chooses to terminate its business or withdrawal from a state or states, it must follow the formal procedures as it did initially to commence doing business in that state(s). If a company does not voluntarily take the official steps to cease doing business legally, then it remains responsible for all the filing, tax, and registered agent requirements it would have been responsible for otherwise. Additionally, states will often involuntarily dissolve a company, or administratively revoke a company's authority to transact business when the company does not maintain good legal standing, fails to comply with corporate governance and compliance matters, files bankruptcy, or fails to properly terminate the company upon the cease of business operations, leaving consequence to future business endeavors.

RASi can help you through each step of the dissolution process

Whether you need assistance with corporate filings or have questions about how to dissolve an LLC, we've got you covered.
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FAQs About Closing or Cancelling an LLC or Corporation
  • What does it mean when a company is dissolved?

    Dissolving an LLC is the official process of closing your company. This requires filing paperwork with the state where you started your business.

    Once your business is dissolved, it ceases to exist as a legal entity. This means it cannot conduct business or sign contracts with anyone.

  • How do you close or cancel an LLC or corporation?

    To officially close an LLC or corporation, you can either dissolve it voluntarily or perform a withdrawal. This typically involves the following steps:

    • Secure approval from company shareholders or members
    • Obtain a tax clearance
    • Inform creditors
    • Revoke all business licenses and permits
    • End any authority to operate in other states
    • Submit a Certificate of Dissolution to your company’s home state
    • Settle any outstanding taxes and file a final tax return

    If you want to stop doing business in a specific state but continue operating in other areas, you need to withdraw from that state. To withdraw, follow these steps:

    • Pay all state fees and any owed taxes
    • File all state reports
    • Submit a Certificate of Withdrawal with the state
  • Why is it important to officially dissolve my business?
    Proper dissolution reduces the personal liability of your business’s members or shareholders. If you don’t dissolve your business correctly, you may face risks such as debts, lawsuits, penalties, ongoing state filing requirements, franchise taxes, and even business identity theft.
Administrative Dissolution Frequently Asked Questions
  • What is administrative dissolution?
    Administrative dissolution is an involuntary process when the state closes your business for you, usually because your company failed to file an annual report or other compliance document on time. It’s an involuntary process handled by the Secretary of State or similar government agency to dissolve a corporation, LLC, or other business entity.
  • What is the difference between administrative dissolution and voluntary dissolution?

    A voluntary dissolution occurs when a company's owners or shareholders choose to close the business. This involves a vote in accordance with your company’s rules. After the vote, you must file formal papers with the state, such as Articles of Dissolution.

    An administrative dissolution is an action by the state to close a business, rather than by its owners or shareholders. It occurs when an LLC or corporation fails to comply with certain state statutes or requirements, such as not filing an annual report.

  • Why does administrative dissolution occur?
    Administrative dissolution occurs when a business entity fails to comply with state-mandated obligations. Common reasons include not filing annual reports, neglecting to pay franchise taxes, or failing to maintain a registered agent or office. These lapses prompt the state to revoke the company's legal status, effectively dissolving the entity.
  • Is administrative dissolution bad? What does administratively dissolved mean for a company?
    Once administratively dissolved, your company loses its legal standing and the authority to conduct business. While it may continue certain activities to wind up affairs, such as settling debts and liquidating assets, it cannot engage in new business operations. Additionally, your company's name becomes available for use by other entities, and your directors or officers might face personal liability for actions taken during the dissolution period.
  • What can you do if your company experiences administrative dissolution?

    Many states provide a path to reinstating a business once it has been administratively dissolved. However, certain requirements must be met. These requirements are unique to each state, but typically involve paying delinquent fees, paying a penalty fee, and submitting necessary paperwork by a new deadline. Some states only allow for the reinstatement of a company if it takes place within a certain period after dissolution. Other states do not allow reinstatement at all but will allow you to form a new company. This means you'll need to go through the entire formation process again, including paying all applicable fees.

    At RASi, we bring years of expertise in reinstating companies back to good legal standing and can assist you in overcoming any compliance or governance challenges.

    Contact us today to streamline your reinstatement or merger process. Our team is ready to help you move forward with confidence.

  • What are the penalties or fees associated with administrative dissolution?
    Penalties and fees for administrative dissolution vary by state but typically include fines for late filings and the costs associated with reinstatement. For instance, some states impose substantial late fees for overdue annual reports, and reinstatement often requires payment of all outstanding taxes, interest, and penalties. These financial burdens can accumulate, making reinstatement a costly process.
  • Can a business still operate after administrative dissolution?
    Legally, a business cannot continue regular operations after administrative dissolution. Any business conducted beyond winding up affairs is unauthorized, and individuals involved may be personally liable for resulting debts or obligations. Operating while dissolved can also lead to legal complications, such as the inability to initiate lawsuits or enforce contracts.
  • How can you avoid administrative dissolution?
    Usually, administrative dissolution comes as a result of being delinquent in annual report or tax filings. However, each state may have additional issues that are grounds for administrative dissolution. Ensuring that you file all reports necessary for compliance with the Secretary of State by the deadline each year can keep you in good standing and help prevent administrative dissolution.
  • How long does a business have to reinstate after administrative dissolution?
    The timeframe for reinstatement varies by state, typically ranging from two to five years after dissolution. Some states may allow reinstatement beyond this period under certain conditions, while others have stricter deadlines. Be sure to consult state-specific statutes to determine the applicable reinstatement window.
  • Can you form a new company as an alternative to reinstatement?
    Yes, forming a new company is an alternative to reinstatement, especially if the reinstatement period has lapsed or the process is too burdensome. However, this approach requires establishing a new legal entity, obtaining new tax identifications, and potentially losing rights to the previous company's name and assets. It's a complex decision that should be made in consultation with legal and financial advisors.
  • How can RASi help prevent administrative dissolution?
    RASi helps your business stay compliant by providing registered agent services, monitoring filing deadlines, and ensuring all necessary documents are submitted on time. With RASi’s tools and expertise, your company can avoid penalties and maintain good standing with the Secretary of State. Additionally, RASi offers guidance and support for businesses looking to reinstate after administrative dissolution, simplifying the process and saving time.

    Ensure your business remains compliant and avoids administrative dissolution with RASi's expert services. Contact us today to find out more.

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