Dissolving a Nevada limited liability company involves certain steps that have to be followed to legally terminate the company.
Having practiced business consultancy specializing in limited liability companies, I will help you expedite the dissolution of your Nevada LLC through research and invaluable experience.
I will also explain the reasons why business owners might choose to dissolve their LLCs. The article is meant to guide you on a legal basis.
Quick Summary
- To dissolve an LLC in Nevada, hold a meeting, follow the operating agreement, notify creditors and clients, and file articles of dissolution.
- An LLC in Nevada may be dissolved for several reasons. The dissolution may be accomplished by voluntary, administrative, or judicial process.
- Voluntary dissolution is due mainly to the decision of the members, whereas involuntary methods include orders by the state or court.
Steps to Dissolving a Nevada LLC
There are steps to dissolving a Nevada limited liability company to ensure a smooth and legal dissolution process.
Step 1: Hold a Meeting
To dissolve a Nevada limited liability company, the members should hold a meeting to determine if the majority of the owners agree to the dissolution.
It would be best if you informed the members of your company that this is a special meeting to discuss dissolving the business entity.
Ensure that the people who are interested in participating can attend and have their voices heard about whether or not they want to dissolve the LLC.
Step 2: Follow Your Nevada LLC Operating Agreement
Consult and follow your Nevada LLC operating agreement to determine the proper dissolution process, voting requirements, division of assets, and liquidation provisions.
A company's operating agreement will specify what happens to LLC assets when the business is dissolved and how the remaining LLC assets should be distributed among members.
In the absence of an operating agreement, you can dissolve a limited liability company if all members agree with the dissolution.
Step 3: Notify LLC Creditors
Notify all LLC creditors about the dissolution of the company and settle outstanding debts and payables.
Wind up all transactions with the company's clients including services, products, or receivables.
You can contact businesses or individuals you owe money to by sending them a certified letter detailing the dissolution of your Nevada limited liability company and what this means for them.
You can also contact them by phone, email, or in person, but it's always best to have something in writing just in case there are any problems later on.
Step 4: Settle Your Tax Liabilities
Close your business tax accounts based on the nature of your business. These may include federal taxes, state taxes, and local employment and business license taxes.
Business tax accounts must be closed, and tax clearance must be filed and submitted to the Nevada Department of Taxation.
To close your tax accounts, you will need to submit the following legal documents:
- Certificate of Dissolution from the State
- Copies of your Nevada LLC Articles of Organization and Operating Agreement (if available)
- Proof that all tax liabilities have been paid in full
If your LLC operates in more than one state, you will need to take care of all outstanding tax accounts in each respective State.
Step 5: File LLC Articles of Dissolution
File LLC Articles of Dissolution with the Nevada Secretary of State to make the process official [1].
Nevada Secretary of State requires that the certificate be mailed to the office along with a filing fee, which must be paid by check or money order made out to Nevada SOS. Nevada accepts online filing through its business portal, too.
When you file Articles of Dissolution, make sure you include the following:
- Articles of Organization
- The effective date of dissolution
- The reason for dissolving the company (i.e., voluntary or involuntary)
- Tax Clearance certificate
- Signatures from LLC members or managers with the authority to dissolve
Reasons to Dissolve a Nevada LLC
The reasons to dissolve a Nevada limited liability company may be voluntary, administrative, and judicial.
1. Voluntary Dissolution of an LLC in Nevada
Members of Nevada limited liability companies initiate the dissolution process by voting to dissolve the company. Once the dissolution vote is taken, a written agreement of dissolution must be filed with both the State's office and all known creditors of the LLC.
LLCs voluntarily dissolve due to several reasons:
- Reaching the end of a set term
- Termination of the project
- Personal decision
- Business is no longer profitable
If an LLC member wishes to withdraw from the company at any point, they may do so by providing written notice to all other members. The remaining members can then decide if they wish to continue operating as an LLC. `
An LLC may conduct business during its winding-up period if all LLC members approve through a written agreement. Once a Nevada limited liability company completes the official paperwork to dissolve, it can no longer operate in the State.
2. Involuntary Dissolution of an LLC in Nevada
The involuntary dissolution of an LLC can be due to administrative or judicial reasons.
When a Nevada LLC ceases to operate for some time, the state office will involuntarily dissolve the company.
The main reasons an LLC would be administratively dissolved are due to:
- Non-payment of annual franchise tax.
- Failure to submit an LLC annual report in Nevada.
- Failure to maintain a Nevada registered agent.
Other reasons why limited liability companies are dissolved judicially are due to:
- Abandonment of the company's affairs.
- Breaching the Nevada LLC articles of organization.
- Operating without a business license.
- Fraud
- Lawsuits
To prevent an LLC from being involuntarily dissolved in Nevada, it is important to conform to all state requirements and maintain good standing of the company.
If you find yourself in a situation where your LLC is at risk of dissolution, reach out for professional help.
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FAQs
What Happens if I Don’t Dissolve My LLC in Nevada?
If you don't formally dissolve your LLC in Nevada, it remains legally liable for its business activities and common taxes.
How Much Does It Cost to Dissolve an LLC in Nevada?
It costs $100 to dissolve an LLC in Nevada but there are expedited options that cost $125 for 24-hour completion, $500 for two-hour service, and $1,000 for one-hour service.
How Long Does It Take To Dissolve a Nevada LLC?
It takes one to two weeks to dissolve a Nevada LLC after filing the Articles of Dissolution. You can shorten the waiting period to one business day if you choose the expedited service.
Can I Re-Register LLC in Nevada After Dissolution?
You can re-register an LLC in Nevada within a five-year frame after dissolution. If you miss this deadline, you will have to file for a new LLC.
How Do I Dissolve a Single-Member LLC in Nevada?
To dissolve a Single-member LLC in Nevada, settle all tax obligations, and file the Articles of Dissolution with the Nevada Secretary of State.
How to Dissolve an LLC in Nevada
To dissolve an LLC in Nevada, you have to consult your LLC's operating agreement and follow all state requirements.
There are several steps involved in the dissolution process before the company can be legally terminated.
A qualified lawyer or law firm can help guide you through the dissolution and ensure that all required steps are taken.
When it comes to something as important as dissolving your LLC, don't take any chances – make sure you get the right advice from a professional.
If you are not sure how to dissolve an LLC in Nevada or have trouble obtaining legal information, seek help from a law firm or IncFile.
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References:
- https://www.nvsos.gov/sos/home/showpublisheddocument/6557/637957187292030000
