If you have decided that it is time to dissolve your Arkansas LLC, you are lucky. This article will provide all the information you need to complete the process.
First, we will discuss determining whether or not your business entity is eligible for dissolution. Then, we will go over the steps involved in dissolving an LLC in Arkansas.
What Should I Know About the LLC Dissolution Process in Arkansas?
If you're no longer interested in operating your LLC, you may wonder how to dissolve it. Dissolving an LLC is different in every state, so it's important to know the steps specific to Arkansas.
Before you dissolve your LLC, it is important to make sure that you are eligible. In order to dissolve an LLC in Arkansas, the business must meet the following criteria:
- All debts and liabilities of the LLC must be paid off or otherwise settled.
- All assets of the LLC must be distributed to its members.
- The LLC must not be involved in any pending legal proceedings.
If your LLC meets all of the above criteria, you can proceed with dissolving the business. Keep in mind that dissolving an LLC is a permanent process, so be sure that you have thoroughly considered your options before making this decision.
If you think your Arkansas LLC is eligible for dissolution, here's a what you should do next:
Follow Your Arkansas LLC Operating Agreement
When you formed your LLC, you should have created an operating agreement. This document outlines the rules and regulations for your business, including how to dissolve the LLC. Be sure to review your operating agreement before taking any action to dissolve your business.
You may find that dissolving your LLC is not as simple as you thought, and there may be specific procedures that you need to follow.
Close all Your Business Tax Accounts
Another important step in dissolving your Arkansas limited liability company is to close all tax accounts associated with the business. To do this, you will need to file a final franchise tax report and obtain tax clearance from the Arkansas Department of Revenue.
Once you have these documents, you can close your LLC's business bank account and cancel any business licenses or permits that you may have.
File the Articles of Dissolution with the Arkansas Secretary of State
The next step in dissolving your LLC is to file the Articles of Dissolution with the Arkansas Secretary of State Business and Commercial Services. This can be done online, by mail, or in person. You will need to provide the following information:
- The name of your LLC
- The date of dissolution
- The reason for dissolution
- The signature of an authorized representative of the LLC
Once you have filed the Articles of Dissolution, your LLC will be officially dissolved.
Notify Your Creditors
If your LLC has any outstanding debts, you must notify your creditors of the dissolution. This can be done by sending a notice of dissolution to each creditor, either by certified mail or registered mail.
Be sure to include the date of the dissolution and the fact that the business is no longer operating. Once you have notified your creditors, you can begin paying off any outstanding debts, including your business taxes.
How to Dissolve a Foreign LLC in Arkansas?
If you have a foreign LLC in Arkansas and want to dissolve it, you will need to follow the same steps as a dissolution for a domestic Arkansas LLC. However, you will also need to file a Certificate of Authority Cancellation with the Arkansas Secretary of State.
Once you have filed the Certificate of Authority Cancellation, your foreign LLC will be officially dissolved in Arkansas.
What Is the Cost to Dissolve an LLC in Arkansas?
The cost to dissolve your Arkansas LLC is $50. This fee is paid to the state when you file your Articles of Dissolution. Once you dissolve your LLC, it is no longer a legal entity and cannot conduct business in the form of Arkansas.
What Happens to the Business Assets of an LLC When It Is Dissolved?
When an LLC is dissolved, its assets are distributed to the members according to their membership agreement. If there is no membership agreement, the assets are distributed in proportion to the members' ownership interests. Debts of the LLC are paid first, and then the remaining assets are distributed.
Dissolving an LLC in Arkansas: Conclusion
Dissolving an LLC is a big decision, and it's important to make sure that you are taking all the necessary steps to do it correctly.
Follow the dissolution procedures outlined in your operating agreement, and consult with an experienced business attorney if you have any questions.
Alternatively, you might hire a specialized service like IncFile and have them submit the articles of dissolution on your behalf. We endorse these services since we have used them personally a few times to wind up some of our client's enterprises.