How to Dissolve an LLC in Iowa

Dissolving a business often involves complex procedures. However, for a limited liability company in Iowa, dissolving it takes a handful of paperwork. When an LLC is formed in Iowa, the owner(s) draft the operating agreement. If the owner(s) decide to dissolve the business, the dissolution takes place following the articles mentioned in the operating agreement.

In this article, LLCBuddy editors shared the ins and outs of dissolving an LLC in Iowa. LLCs must file the Articles of Dissolution with the Iowa Secretary of State like the formation certificate was filed at the time of forming an LLC in Iowa. It takes a few days to process and a handful of fees to be paid to the SOS. Many people hire a professional service to do the paperwork to process it hassle-free.

At the time of forming an LLC, an operating agreement draft must be written. Generally, the process of dissolution takes place following the operating agreement (read: Iowa LLC operating agreement). Before the dissolution process, there are a few things to consider in the LLC.

First, make sure all the members of the LLC agree to dissolve the business. Once all the members are ready, their consent should be recorded via voting. After casting their vote in favor of the dissolution, the legal process must be started.

Dissolution of Iowa LLC requires three broad procedural steps. Having a Iowa LLC Operating Agreement, closing all the tax accounts, and finally submitting the Articles of Dissolution form to the Iowa Secretary of State.

Step 1: Follow the LLC Operating Agreement in Iowa

When you have started an LLC as a business entity, then there is an operating agreement that is formed. There are complete details of how the company will function and grow in that operating agreement, which acts as a comprehensive guide. There is also a dissolution process, which is added to your agreement. The common dissolution steps that almost every LLC follows are:-

First of all, the dissolution vote will take place among the LLC members in the dissolution meeting. If the majority is with the YES, then the process goes into legal proceedings.

All the dissolution votes will be noted down and recorded with the minutes of the meeting or a consent form.
After that, a formal date for dissolving the LLC will be decided.
The next step is counting the LLC assets and dividing them among the stakeholders and members accordingly.
Finally, the creditors of the business are notified, and the debts of the business are settled.

This is a general process. However, it is strongly recommended to seek professional help to avoid any complications when it comes to terminating an LLC in Iowa.

Get a Professional Agent Service

When it comes to a limited liability company dissolution, it is important to get professional help. Iowa registered agent will guide you with everything you need to close your limited liability company. While choosing a registered agent make sure they have a physical street address in the state. A professional service provider helps you to file the Article of Dissolution and close your various tax accounts without any hassle. Below are the best LLC services in Iowa that we strongly recommend for you.

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Step 2: Close All Tax Accounts

Every action that an official business takes is legally bound to some minimum business taxes. For that, various accounts, especially business entity tax accounts, are maintained by the state government with the help of various departments. You should consider all the taxes that you have paid for your LLC’s duration and make a list of them.

You must contact all government entities and clear the amount of outstanding taxes due by the date you have decided to dissolve. All the taxes must be paid in advance so that you don’t face any issues in the process of shutting down your LLC.

Some of the common taxes that limited liability companies have to pay are:

Unemployment insurance tax
Employee withholding tax if your LLC has employees.
If your LLC is engaged in selling taxable goods then they are liable to pay the sales and use tax.

Most of these taxes are normally filed, but some departments require official paperwork, without which it is impossible for the business to close their accounts. Apart from business taxes, federal taxes, personal income taxes, and franchise taxes are to be considered. For the franchise taxes, a franchise tax form is required. That is why the LLC owner should go through the sales tax guide and hire an accounting service.

Tax clearance

While dissolving the Iowa LLC, the owner is not required to obtain a tax clearance certificate. However, if you have filed federal taxes, then you must go through the final return option on your IRS form.

The IRS form for the LLCs that are classified as partnerships is Form 1065, and those LLCs who have registered themselves as corporate should check IRS Form 1120.

BOI Reporting

If you’re going to dissolve your LLC this year, make sure to update your BOI reporting. From January 1, 2024, the Financial Crimes Enforcement Network (FinCEN) implied a rule to all businesses, including LLCs in Iowa to file the BOI Report. The Beneficial Ownership Information (BOI) in Iowa is a report that states about in and out of the company. This report must be up-to-date and submitted to the FinCEN before you proceed to the dissolution.

Step 3: File Articles of Dissolution

There is a list of dissolution documents that you, as an LLC owner, have to file. Once these articles are filed, the legal existence of the LLC will be over. Like a Iowa Certificate of Organization, one has to file Iowa LLC Certificate of Organization. The dissolution procedure and filing the articles of dissolution form is very easy and is discussed below.

First of all, the LLC owner(s) has to file the Article of Dissolution. There are multiple methods of filing available, such as filing by mail, in-person drop, or/and online filing.
You can follow the filing instructions on the official portal so that the steps for dissolution will be easier to complete.
For offline filing, LLCs must download the form and submit it to the Iowa Secretary of State physical office along with the state filing fee.
If you want to dissolve Iowa Foreign LLC then look for the Foreign LLC Dissolution process.
You must fill in all the important and legal information in the form, so you should be extra careful.
After filling in all the important information, you must choose the mode of payment you want to use to pay the LLC dissolution filing fees.
After filling in every detail, one should submit the form through an official mail address and make a payment.

Filing	Forms and Details
Online Applications	Sign in to SOS
Offline Applications	LLC Dissolution Instructions
SOS Contact (if offline application is available)	Lucas State Office Building, 321 E 12th St, Des Moines, IA 50319
Filing Time	2 to 3 working days
Filing Fee	$5

The LLC you own is dissolved, and you are free from all the liabilities linked with the LLC and its taxes. A copy of both original articles and recorded articles should be submitted in front of the probate judge. Now it’s his call whether he accepts your expedited dissolutions or not.

Points to Be Noted When Dissolving an LLC in Iowa

Apart from these three steps, no major dissolution rules are there in Iowa. However, there are some other tasks one has to keep in mind while dissolving an LLC legally.

Winding Up

Some purposes of LLC require some attention even after dissolution, known as winding up. The task of winding up includes.

For a certain period, the property of a business requires preservation.
If there is any civil case against the LLC, then the owner needs to finish them.
Settle all the existing disputes of LLC.
Transfer all the property of the LLC to the names of partners.
Release all the liabilities that the LLC owes to others.
Rightful distribution of all the assets among members, according to their percentage of partnerships.

Cost of Dissolving LLC

LLC costs in Iowa include the formation as well as dissolution fees. To dissolve an LLC in Iowa, LLCs have to file an Article of Dissolution. The filing fee is $5. The details are mentioned in the articles of dissolution filing form. Following are the ways to pay for the dissolution,

You can select a payment pick-up option.
There is an option for direct account transfer through your prepaid accounts.
LLC owners can also use their Credit cards, providing their complete details and types. Along with that, an original signature is required to authorize the transaction the state will make.

After Dissolving Your LLC

After you dissolve an LLC in Iowa, you can reinstate or revive the same within a given time. In Iowa, the LLC name will be available up to 5 years. After this, the name will be available to other LLCs. Besides, you might revive or reinstate the LLC in Iowa if that is available. According to the Iowa SOS, you can revive your LLC anytime as there is no time limit for reinstatement. but after 5 years the name will be gone so you need to file an amendment document..

Reasons Behind Dissolving an LLC in Iowa

People always think they can leave the company without any notice and there will be no issue. But if you have an LLC that you created with a legal obligation, it needs to be ended that way. Yes, if someone will dissolve an LLC in Iowa, they will have to do it while taking care of the government. For dissolving the company, there is always a reason. The reason can be voluntary or involuntary too. Let’s get to know about the involuntary reasons,

If the company was caught doing illegal business.
If the company’s member died due to some reason or went bankrupt.
The dissolution will be mandatory if the assets of the business are used unwisely.
If the time being of the company was already determined in the will, then the company will go into dissolution at that time.

Top Businesses in Iowa

With the population of 3,233,572, Iowa is one of the favorable places to start an LLC. According to several reports, starting an LLC for Specialty Bakery can be profitable as various places in the state showed steady growth in this business over the past few years. On the other side, based on the city or region you’re going to start your LLC, you can decide the type of business to start. Following are the top 5 businesses you can start in Iowa.

Specialty Bakery
Content Writing
Childcare Service
Food Truck
Coffee Shop

Iowa LLC Dissolution Review – A Quick Recap

Here’s a recap of the steps you must follow when dissolving your Iowa LLC. Click on the steps in this list if you want to read the full details.

Follow Your Iowa LLC Operating Agreement: Remember that when you started, you created an operating agreement. Use this agreement as a guide in proceeding with the dissolution of your LLC.
Close All Tax Accounts: Make sure you close all your tax accounts to avoid incurring further costs.
File Certificate of Organization: File the article of dissolution to make it known to the state where your LLC operates that you are indeed no longer in business.

FAQs

What is the process for dissolving an LLC in Iowa?

The process for dissolving an LLC in Iowa involves filing a Certificate of Dissolution with the Iowa Secretary of State.

How much does it cost to dissolve an LLC in Iowa?

The fee for filing a Certificate of Dissolution for an LLC in Iowa is $5.

Can an LLC in Iowa be dissolved without filing a Certificate of Dissolution?

No, in Iowa, an LLC must file a Certificate of Dissolution with the Secretary of State to officially dissolve.

Are there any specific requirements for notifying creditors when dissolving an LLC in Iowa?

Yes, in Iowa, you must provide written notice to all known creditors of the LLC when dissolving.

How long does it take to dissolve an LLC in Iowa?

The process of dissolving an LLC in Iowa can take anywhere from a few weeks to a few months, depending on various factors.

What happens to the assets of an LLC when it is dissolved in Iowa?

The assets of an LLC in Iowa are typically distributed to creditors and members after all debts and obligations are paid off.

Can an LLC in Iowa be reinstated after it has been dissolved?

Yes, an LLC in Iowa can be reinstated within 2 years of its dissolution by filing a reinstatement application and paying the required fees.

What is the penalty for failing to properly dissolve an LLC in Iowa?

If an LLC in Iowa fails to properly dissolve, it may continue to be liable for taxes, fees, and other obligations.

Can I sell the assets of my dissolved LLC in Iowa?

Yes, you can sell the assets of a dissolved LLC in Iowa, but any proceeds must be used to pay off debts and obligations of the LLC.

Do I need to file a final tax return for my dissolved LLC in Iowa?

Yes, you need to file a final tax return for your dissolved LLC in Iowa and indicate that it is the final return for the LLC.

Can I dissolve my LLC in Iowa if it has outstanding debts?

Yes, you can dissolve your LLC in Iowa even if it has outstanding debts, but those debts will need to be paid off during the dissolution process.

Will dissolving my LLC in Iowa affect my personal liability for any debts or obligations?

Dissolving an LLC in Iowa does not necessarily eliminate personal liability for any debts or obligations incurred by the LLC.

Do I need to notify the Iowa Department of Revenue when dissolving my LLC?

Yes, you need to notify the Iowa Department of Revenue when dissolving your LLC and fulfill any outstanding tax obligations.

Can I dissolve my LLC in Iowa if it is involved in pending litigation?

You can dissolve your LLC in Iowa even if it is involved in pending litigation, but you may still be responsible for resolving the legal matters.

Is there a specific form required to dissolve an LLC in Iowa?

Yes, you must file a Certificate of Dissolution with the Iowa Secretary of State to officially dissolve your LLC in Iowa.

Can I transfer the assets of my dissolved LLC in Iowa to another entity?

You can transfer the assets of your dissolved LLC in Iowa to another entity, but the transfer must comply with state laws and regulations.

Do I need to cancel my LLC’s registered agent when dissolving in Iowa?

Yes, you must cancel your LLC’s registered agent when dissolving it in Iowa to terminate the agent’s authority to act on behalf of the LLC.

Can I dissolve my foreign LLC in Iowa?

Yes, you can dissolve a foreign LLC in Iowa by following the same dissolution process as a domestic LLC.

Can I change my mind after filing for dissolution of my LLC in Iowa?

Once you file for dissolution of your LLC in Iowa, it is difficult to reverse the process, so consider the decision carefully before proceeding.

Can I dissolve my Iowa LLC online?

Yes, you can dissolve your Iowa LLC online by filing the necessary forms and paying the associated fees through the Iowa Secretary of State’s website.

What is the publication requirement for dissolving an LLC in Iowa?

There is no publication requirement for dissolving an LLC in Iowa, but you must still notify known creditors and follow other state-specific procedures.

Can I dissolve my LLC in Iowa if it is currently suspended or revoked?

You must first address any issues that led to the suspension or revocation of your LLC in Iowa before proceeding with the dissolution process.

Can I transfer the name of my dissolved LLC in Iowa to a new business entity?

Once your LLC is dissolved in Iowa, the name becomes available for use by other entities, but there may be restrictions based on state law.

What is the timeframe for completing the dissolution process of an LLC in Iowa?

The timeframe for completing the dissolution process of an LLC in Iowa can vary, but typically takes a few weeks to a few months.

Will dissolving my LLC in Iowa affect my personal tax obligations?

Dissolving an LLC in Iowa may affect your personal tax obligations, so it is recommended to consult with a tax professional for advice on how to proceed.

Can I dissolve my LLC in Iowa if it is still generating income?

Yes, you can dissolve your LLC in Iowa even if it is still generating income, but you must address the tax implications of this income during the dissolution process.

Can I dissolve my LLC in Iowa if I am the sole member?

Yes, you can dissolve your LLC in Iowa if you are the sole member, but you must still follow the same dissolution procedures as if there were multiple members.

What documents do I need to submit to dissolve my LLC in Iowa?

To dissolve your LLC in Iowa, you need to submit a Certificate of Dissolution and any other required forms to the Iowa Secretary of State.

How do I dissolve an LLC in Iowa?

To dissolve an LLC in Iowa, you must file Articles of Dissolution with the Iowa Secretary of State.

What information is needed to file Articles of Dissolution in Iowa?

You will need to provide the name of your LLC, the reason for dissolution, and the effective date of dissolution when filing Articles of Dissolution in Iowa.

In Conclusion

Dissolving a business is not an easy task as a lot of homework is involved with the process. The official process might have only a few steps, however, before and after dissolving the LLC, there might be a lot of other tasks. In this case, it is highly recommended to get a professional service. If you are looking to file an LLC at $0, then ZenBusiness is your answer.

Limited liability companies reduce owners’ personal liability. Having an LLC is quite cost-effective. However, if it is required to close down the business, then the dissolution process should be done legally. This article shared the general steps. Let us know if you have any queries.