To dissolve a limited liability company one has to take up a set of required steps. In Montana, if you and the members of the LLC want to discontinue business, then it is necessary to dissolve their business legally to avoid any administrative and legal consequences. To dissolve an LLC in Montana, you are required to submit a complete Article of Dissolution to the Secretary of State. Before submitting the Article of Dissolution, one must follow the operating agreement.
If you have a Montana LLC (domestic or foreign) you must have an operating agreement. The first step towards the dissolution of Montana LLC is to follow the operating agreement. There are some points to be noted before proceeding with the official paperwork. At first, make sure all the members of the LLC are agreed 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. Here are the steps to address for dissolving Montana LLC.
On this page, you’ll learn about the following:
- How to Dissolve an LLC in Montana
- After Dissolving Your LLC
- Reasons Behind Dissolving Montana LLC
- Montana LLC Dissolution Review
How to Dissolve an LLC in Montana
Dissolution of Montana LLC requires three broad procedural steps. Having a Montana LLC Operating agreement, close all the tax accounts, and finally submit the Articles of Dissolution form to the Montana Secretary of State.
Step 1: Follow Your Montana LLC Operating Agreement
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.
Get a Professional Agent Service
When it comes to a limited liability company dissolution, it is important to get professional help. The Montana 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 we strongly recommend for you.
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 account, 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 until the date you have decided for dissolution. All the taxes must be paid in advance so that you don’t face any issues in the further 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. If you want to do the accounting yourself or make accounting easy, try FreshBooks.
While dissolving the Montana LLC, the owner does not require 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.
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 Montana Articles of Organization, one has to file Montana LLC Articles of Dissolution. 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 file by mail, in-person drop, or/and online filing. To get the application form you need to visit the Secretary of State Website of Montana state.
- You can follow the filing instruction on the official portal so that the steps for dissolution will be easier to complete.
- In that particular SOS website, the LLC owner has to look for the Domestic LLC Articles of Dissolution page.
- If you want to dissolve Montana Foreign LLC then look for the Foreign LLC Dissolution process.
- There is a form available on this page, which is the article of dissolution you are looking for.
- 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.
- It takes 3-5 business days after filing of articles of dissolution.
Online FIling: Montana Online LLC Dissolution
Filing Fee: $15
The LLC you owned 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 that he accepts your expedited dissolutions or not.
Points to Be Noted When Dissolving Montana LLC
Apart from these three steps, no major dissolution rules are there in Montana. However, there are some other tasks one has to keep in mind while dissolving an LLC legally.
There are some purposes of LLC that 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 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 cost in Montana includes the formation as well as dissolution fees. To dissolve an LLC in Montana, LLCs have to file an Article of Dissolution. The filing fee is $15. The details are mentioned on the second page of the article dissolution filing form. Following are the ways to pay for the dissolution,
- You can select a payment pick-up option.
- There is an option of 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 state will make.
After Dissolving Your LLC
After you formally dissolve your LLC, your business name will not be reserved anymore. Any other business entity will be eligible to use your Montana LLC name immediately after 120 days of dissolving your LLC. On the other hand, if you have a foreign LLC in other states, then you must comply with the SOS of the state after the dissolution of your LLC in Montana. A registered agent can help you do the needful.
Reasons Behind Dissolving Montana LLC
If a business cannot make better outputs, nothing is left in it rather than leaving it. It is better to dissolve an LLC in Montana rather than keep putting effort into it. We all know that it is impossible to make the business well and good again, so it is better to dissolve it. There is not just one reason that this can happen. There are many reasons, here, let’s get a look at them,
- The business is not getting the support that it should.
- The owners are not willing to keep it going on.
- The government shut the company due to legal reasons.
- The company is not able to pay the taxes.
- The assets of the company are of no use and getting surpassed by liabilities.
Top Businesses in Montana!
If we talk about the industries, then the economy of Montana depends a lot on agriculture. Due to the best and fertile land, Montana is doing great in the matters of agriculture. There are other industries in the state, too, if someone wants to start an LLC in Montana. With the help of knowing which industry is the best and making the most profits, it will be best to make profits. Want to know more about it? Check the following points for top industries,
- Healthcare: If we talk about the fastest growing industries, it is Montana’s healthcare industry. It employs about 68,000 people and provides an annual growth of 2.8%. We will always expect this sector to grow in the following years, too, as it is critical for all.
- Tourism and travel industry: If we look at the growth of this industry, it has grown gradually. People thought there would be a decline, but it is employing 50,000 people in it. The employment rate is seriously incredible, and it is right what we are looking for the positive impact on the state.
- Manufacturing: There are so many employment opportunities in this sector of the economy. With this sector, it is possible to get done with the issues of employment totally and easily. If we talk about the employment growth, it had increased by 21.3% in 2018. It is an excellent thing for the state, and not just men, but women can also get jobs.
Montana LLC Dissolution Review
Time needed: 5 minutes
Here’s a recap of the steps you must follow when dissolving your Montana LLC. Click on the steps in this list if you want to read the full detail.
- Follow Your Montana 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 Articles of Dissolution
File the article of dissolution to make it to the state where your LLC operates is that you are indeed no longer in business.
Yes, in Montana, there is a fee of $15 to be paid for filing the Articles of Dissolution. Articles of Dissolution must be submitted to the Montana SOS.
No, there is no requirement of revenue department clearance till the time the SOS of Montana accepts the dissolution form.
The name will also get deregistered with the dissolution of the LLC. But the name will not be allotted for the next 120 days. After that, if some business wants to name their LLC after the name chosen by you, then it is their choice.
If you have not dissolved your LLC, you are liable for business privilege tax, and if it is not paid on time, you are leveraged with 10% of the amount of tax or $50. After that, the additional penalties will increase by $1 per month. If it goes unpaid for a longer duration, then the chances of seizing your property can also recover the tax.
If you are dissolving your LLC, you have to pay some amount to the probate judge who was also present during your LLC formation in the probate office. The minimum fee of the judge is $50, which can vary.
What is the Cost to Dissolve an LLC in Montana
To dissolve an LLC in Montana you need to file the Articles of Termination with the Montana Secretary of State online for $15.
First and foremost, it is vital to acknowledge that the exact cost of dissolving an LLC in Montana can vary based on various factors. These factors include the complexity of the business structure, outstanding debts, contractual obligations, legal requirements, and the manner in which the LLC is dissolved. Given this variability, potential LLC owners contemplating dissolution must consult experts and professionals who can provide accurate and personalized information.
One of the primary costs associated with dissolving an LLC revolves around the completion of required paperwork and filings. Montana law requires the filing of Articles of Dissolution with the Secretary of State to formally terminate an LLC. This process typically incurs a filing fee that varies depending on the specific state fee schedule. While this fee is typically affordable, it is necessary to consider it as an additional cost when evaluating the overall expense of dissolving an LLC.
Moreover, if the LLC possessed a unique business name or trademark, the owner might incur costs related to withdrawing assumed business names or trademarks. Discontinuing the usage of such names and ensuring compliance with legal obligations pertaining to their relinquishment may require engaging legal counsel or trademark specialists, which can add to the cost of dissolution.
Additionally, business owners should be aware of other expenses associated with wrapping up the LLC’s affairs. These expenses may include cancelling various licenses and permits, settling outstanding obligations with suppliers or vendors, fulfilling contractual obligations, and distributing remaining assets to members. Accurate financial record-keeping is crucial during this process, as it assists in appropriately addressing debts and avoiding potential legal disputes. While these expenses tend to vary depending on the nature and scope of the business, it is advisable to seek professional guidance to ascertain that all obligations are met satisfactorily.
In cases where an LLC has significant assets or employees, it is crucial to account for potential severance or termination expenses. These expenses may include unemployment taxes, accrued vacation or sick pay, and potential legal fees associated with employment contract termination. Furthermore, business dissolution may trigger tax liabilities, including capital gains or losses and liquidation taxes, which vary case by case. It is important to consult with a qualified tax professional or accountant to navigate through the complexities of tax implications linked to LLC dissolution.
As with starting an LLC, dissolving a business requires an understanding of the associated costs. Montana business owners considering LLC dissolution must not only encompass the straightforward filing fees but also budget for various other potential expenditures. Consulting attorneys, trademark specialists, accountants, and tax professionals can provide invaluable insight into fulfilling legal obligations, minimizing liabilities, and ensuring an equitable division of remaining assets.
In conclusion, the cost to dissolve an LLC in Montana involves factors like filing fees, relinquishing business names or trademarks, settling obligations, potential employee severance, and dealing with tax implications. Entrepreneurs should approach these costs holistically, taking into account the unique circumstances of their business. Sound financial planning and seeking professional guidance can help minimize unexpected expenses, ensuring a smooth and transparent process of LLC dissolution.
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. Get a professional service to get everything done. We hope this article helps you to close your LLC in Montana. If you have any query do let us know in the comment box.