When your Montana LLC has fulfilled its purpose or is no longer profitable, and you would like to dissolve it, there are a few things you need to do to make the Montana dissolution process official.
As a business consultant and legal advisor with over a decade of practice, I will provide you with a comprehensive guide on how you could dissolve your Montana limited liability company and what to do after the dissolution.
Quick Summary:
- To properly dissolve an LLC in Montana, you should consult the operating agreement, close all tax accounts, and file a Certificate of Dissolution to the Montana Secretary of State.
- Inform banks, creditors, and other loan associations about the dissolution and settle obligations such as business debts and business documents.
- The reasons a Montana LLC may be dissolved are due to voluntary reasons as well as administrative and judicial rulings.
Steps To Dissolve an LLC in Montana
The steps to dissolve an LLC in Montana include following the operating agreement, notifying creditors, cancelling all business licenses and filing a Notice of Dissolution.
Step 1: Follow Your Montana LLC Operating Agreement
If your Montana LLC was formed with more than one member, follow the procedures outlined in your Montana LLC operating agreement.
An LLC’s operating agreement is a contract between the members of the LLC that sets forth how the business will be run, the process of dissolution - voting requirements, division of assets, and liquidation.
In the absence of an operating agreement, state laws apply. You will need to get the vote of all Montana LLC members to dissolve the company.
The Montana LLC Act is a set of laws that govern limited liability companies in the state of Montana.
It is important to familiarize yourself with these laws before taking any action to dissolve your limited liability company.
Step 2: Notify Your Creditors
After following the provisions indicated in the LLC’s operating agreement, notify your creditors and all interested parties that the company is being dissolved and settle obligations.
You may also need to settle all your taxes, get a tax certificate from the Department of Revenue, and file annual reports before you can dissolve your Montana corporation.
Step 3: Cancel Your LLC’s Business License
Cancel your LLC’s business license by contacting the Montana Department of Revenue and asking for a Business License Cancellation form.
You will also need to surrender any professional licenses your Montana LLC may have, such as a contractor’s license or a real estate broker’s license.
Step 4: Give Notice of Dissolution to the Montana Secretary of State
The final step in the dissolution process is giving notice of dissolution to the Montana Secretary of State by filing a Certificate of Dissolution [1].
This document must include the following information:
- The business name
- The date of dissolution
- The reason for the dissolution
You can find a sample notice of dissolution on the Montana Secretary of State’s website.
Once you have completed the form by providing the required information about your Montana LLC, you will need to submit it to the Montana Secretary of State along with the filing fee, which costs $20.
Once you have taken all of these steps, your Montana limited liability company will be officially dissolved.
After Dissolving Your LLC
After dissolving your Montana LLC, you will need to take a few steps to wrap up the Montana business.
This includes the following:
- Closing any bank accounts or credit lines associated with the company.
- Notify the Internal Revenue Service (IRS) that your LLC has been dissolved by filing a final tax return for the LLC.
- Keep good records of the dissolution process. This will come in handy if you ever need to reference it in the future.
Reasons Behind Montana LLC Dissolution
Voluntary, administrative, and judicial dissolution are the primary reasons why a Montana business owner might want to dissolve their LLC after getting a tax certificate and filing LLC annual reports in Montana.
1. Voluntary Dissolution:
- The LLC has achieved its business purpose.
- The LLC is no longer profitable.
- The LLC members' personal reasons.
2. Administrative Dissolution (dissolved by state):
- Delinquent submission of annual reports
- Unpaid franchise taxes
- Failure to appoint a Montana registered agent
3. Judicial Dissolution (dissolved by state):
- Illegal operations
- Commission of fraud
- Lawsuits
By following these steps, you can ensure that your interests are protected and that the dissolution of your limited liability company is done correctly.
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FAQs
What Is the Difference between Domestic Montana LLC and Foreign LLC Dissolution?
The difference between a Domestic and Foreign Montana LLC dissolution lies within the legal forms an entity must submit to the Secretary of State.
A Foreign Montana LLC must submit a Certificate of Withdrawal of a Foreign Liability Company and obtain a Tax Certificate.
Can a Dissolved Montana LLC Still Operate?
A dissolved Montana LLC can no longer operate because the existence of the business has been legally terminated.
Do I Need a Registered Agent to Dissolve a Montana LLC?
You do not need a registered agent to dissolve a Montana LLC. You may dissolve your LLC by filing the Montana LLC Articles of Dissolution with the Division of Corporations.
Dissolving an LLC in Montana
Dissolving an LLC in Montana is a relatively simple process, but it is important to make sure that you follow the proper steps in order to do so.
Be sure to review your Montana LLC operating agreement carefully and consult with an attorney if you have any questions about the process.
You can use a professional service like IncFile to complete the process on your behalf. We recommend this service as we personally used it a few times to dissolve some of our client's businesses.
Our #1 Recommendation
References:
- https://sosmt.gov/business/how-do-i/
