How to Dissolve an LLC in Arkansas? (Step by Step Guide)
Limited liability company owners choose to voluntarily dissolve their Arkansas LLC because the business has already accomplished its goals, a project has been concluded and the business is no longer profitable.
Regardless of the reason, it is essential to follow the legal process for dissolution.
As a business consultant specializing in limited liability companies, I have over a decade of experience addressing clients’ concerns.
After comprehensive research and collaboration with our team of attorneys, I’ll offer you a detailed guide on dissolving your Arkansas LLC, backed with all the legal information you need.
Quick Summary
- To dissolve an Arkansas limited liability company, members should consult the operating agreement and file the required documents with the Arkansas Secretary of State Business and Commercial Services.
- Close all your business tax accounts by filing a final franchise tax report and obtaining clearance.
- Notify all interested parties to settle business operations and outstanding obligations.
How To Dissolve an LLC in Arkansas
To dissolve an LLC in Arkansas, ensure the business is eligible and meets the following criteria:
- All business debts and liabilities of the Arkansas LLC must be paid off or otherwise settled.
- All remaining assets of the Arkansas LLC must be distributed equitably to its members.
- The Arkansas 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 what you should do next:
1. Follow Your Arkansas LLC Operating Agreement
The Arkansas LLC operating agreement outlines the rules and regulations for managing your business, including the dissolution process – voting requirements, and liquidation of assets.
Be sure to review your LLC operating agreement before taking any action to dissolve your business.
2. 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 close your tax accounts, 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 tax accounts and cancel any business licenses or permits that you may have.
Learn more about LLC taxes in Arkansas.
3. 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 the 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 Interested Parties
Begin with winding down the business by notifying all interested parties, including the clients, creditors, and banks by sending a notice of dissolution by mail.
Be sure to include the date of the dissolution and the fact that the business is no longer operating.
Settle all remaining services with clients and pay off outstanding debts to creditors. Afterward, distribute the remaining assets equitably to the members, as per the Arkansas LLC operating agreement [1].
How to Dissolve a Foreign LLC in Arkansas?
To dissolve a foreign LLC in Arkansas, you will need to file a Certificate of Authority Cancellation with the Arkansas Secretary of State and follow the same steps as a dissolution for a domestic LLC in Arkansas.
Once you have filed the Certificate of Authority Cancellation, your foreign LLC will be officially dissolved in Arkansas.
Related Articles:
- Arkansas LLC Lookup
- How to Open an LLC in Arkansas
- Top LLC Formation Services in Arkansas
- Premium Registered Agents in Arkansas
FAQs
What Is the Cost to Dissolve an LLC in Arkansas?
The cost to dissolve an LLC in Arkansas is $50. This fee is paid to the state when you file your Articles of Dissolution.
What Happens to the Business Assets of an Arkansas LLC When It Is Dissolved?
When an Arkansas LLC is dissolved, its business 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
Dissolving an LLC in Arkansas is accomplished by following the dissolution procedures outlined in your operating agreement and filing state requirements.
Alternatively, you might consider hiring 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.
References:
- https://www.sba.gov/blog/basic-information-about-operating-agreements
