How to Dissolve an LLC in New York? | Step-By-Step Guide
LLC owners may decide to dissolve their New York LLC due to the completion of the venture, termination of a project, and personal decisions. Whichever the case, dissolving an entity is accomplished by taking a procedural approach.
After consulting with my fellow LLC specialists in New York, I gained considerable knowledge regarding the dissolution process in the state. I also spent my time researching the legal aspects of the procedure to help your New York LLC stay compliant with state laws.
Quick Summary
- To dissolve an LLC, follow the operating agreement, notify relevant parties, settle debts and obligations, and file the Articles of Dissolution to the New York Department of State.
- The members can opt for Voluntary Dissolution.
- The LLC may be dissolved through a judicial process if there are disagreements, deadlock, or impasses among members.
How Do I Dissolve My LLC?
Voluntary and Judicial Dissolution are ways to dissolve an LLC.
Voluntary Dissolution is when the owners decide to formally terminate the business. New York LLC members convene and acquire a majority vote to end the business by state laws or the operating agreement.
Judicial dissolution of a New York LLC is necessary when partners cannot settle business disputes, so they go to court to resolve a deadlock among the members [1].
Procedure for Voluntary Dissolution
The procedure for voluntary dissolution of a New York Limited Liability Company is accomplished by following the provisions indicated in the operating agreement and state requirements.
Step 1: Follow the Rules of Dissolution
For a New York limited liability company to voluntarily dissolve, members should convene and follow the rules of dissolution stated in the operating agreement.
This document outlines the dissolution process, voting requirements, as well as the division and liquidation of LLC assets.
If the majority of members agree with the dissolution, they should sign a written consent form stating so.
Step 2: Wind Up Your LLC
The process of winding up your New York LLC means settling unfinished business affairs, which includes resolving any lawsuits, paying all outstanding debts and liabilities, and distributing LLC assets among its members.
Read More: What Happens to Assets of a Dissolved Company
Step 3: Notify Concerned Parties
New York limited liability company members should notify banks, creditors, clients, and all third parties of the impending dissolution as soon as the process has begun.
New York LLC might also be required by law to notify its employees and pay the remaining wages.
Step 4: Tax Clearance
LLC members should pay minimum business taxes, file the final business tax returns, and close all business tax accounts to get written consent for dissolution.
If the LLC has incurred tax liability in New York City, obtaining written consent to dissolve from the New York City Commissioner of Finance is necessary as well.
While it is true that no New York Department of State requires you to have your tax clearance before dissolving your LLC, the New York Department of Taxation and Finance strongly recommends you file:
- Final business tax returns
- Final form NYS-45, if you have employees
- Final sales tax return, if you sell goods
On your IRS Form 1065, check the "final return" box when you submit your federal tax return.
Step 5: Out-Of-State Registrations
If your New York LLC is qualified to conduct business in other states, you'll need to submit separate forms to terminate your right to do business in those states.
Generally, this process will involve filing a certificate of termination with the appropriate government agency in each state where your LLC is registered to transact business.
Make sure you follow the specific instructions for each state, as they can vary significantly.
You may continue to be liable for annual report fees if you don't submit the extra termination forms.
Out-of-state registrations typically need to be filed with the Secretary of State's office or equivalent.
Step 6: File Articles of Dissolution
File the Articles of Dissolution with the New York Department of State. The document contains the following:
- Dissolution form
- Business name
- Date of organization
- Written consent form
- Reason for dissolution
Articles of Dissolution should be sent to this mailing address:
NY State Department of State Division of Corporations, State Records and Uniform Commercial Code
One Commerce Plaza
99 Washington Ave.
Albany, NY 12231-0001
Once all of these steps are completed, the business is considered dissolved.
You can find the forms, filing fees, and mailing addresses on the official websites of the New York Department of State.
Related Articles:
- How To Look Up An LLC in NY
- New York Registered Agents
- How to Apply for an LLC in New York
- LLC Filing Services in New York
FAQs
How Long Does It Take to Dissolve an LLC in New York?
It takes about 120 days to dissolve an LLC in New York. However, expedited processing only takes at least a month.
How Much Does It Cost to Close an LLC in New York?
It costs $60 to dissolve an LLC in New York and an additional $25 for expedited processing.
How Long Before Someone Can Take Your New York LLC Name?
Someone can take your New York LLC name after the dissolution process is officially finished.
How to Dissolve a Single-Member LLC in New York?
To dissolve a single-member LLC in NY, you need to submit the legal documents necessary to terminate the company with the New York Department of State.
How to Dissolve a Foreign LLC in New York?
To dissolve a foreign LLC in New York, you must submit the Certificate of Surrender of Authority to the New York Department of State.
How Long Does It Take the State of New York to Process the Filing?
The state of New York takes around 90 days to process the filing of the dissolution documents. The duration mainly depends on unresolved issues and complications. If there are more owners and articles, the processing might last much longer, except with expedited processing.
Dissolving an LLC in NY
Dissolving an LLC in NY is accomplished by following the provisions indicated in the New York LLC operating agreement, settling all debts and obligations including taxes, and filing the Articles of Dissolution with the New York Department of State Division.
The state's laws are complex, so you need to be sure that the appropriate steps have been taken before your final dissolution date arrives.
For this process to go easily as possible, we recommend seeking legal advice and professional service from IncFile. The company specializes in providing expert service for all your business needs.
References:
- https://www.newyorkbusinesslawyerblog.com/judicial-dissolution-of-an-llc-in-new-york/
