To dissolve a limited liability company one has to take up a set of required steps. In South Carolina, 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 South Carolina, 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 an LLC in SC (domestic or foreign) you must have an operating agreement. The first step towards the dissolution of South Carolina 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 South Carolina LLC.
On this page, you’ll learn about the following:
- How to Dissolve an LLC in South Carolina
- After Dissolving Your LLC
- Reasons Behind Dissolving South Carolina LLC
- South Carolina LLC Dissolution Review
How to Dissolve an LLC in South Carolina
Dissolution of South Carolina LLC requires three broad procedural steps. Having a South Carolina LLC Operating agreement, close all the tax accounts, and finally submit the Articles of Dissolution form to the South Carolina Secretary of State.
Step 1: Follow Your South Carolina 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 South Carolina 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 South Carolina 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.
The IRS form for the LLC that are classified as partnerships is form 1065, and those LLC’s who have registered themselves as corporate should check IRS form 1120.
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 South Carolina Articles of Organization, one has to file South Carolina 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 South Carolina 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 South Carolina 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 have to download that pdf form and start filling it.
- 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.
- It takes 3-5 business days after filing of articles of dissolution if you are filing it by mail or in-person.
Secretary of State
South Carolina Secretary of State’s Office
Attn: Corporate Filings
1205 Pendleton Street, Suite 525
Columbia, SC 29201
Filing Fee: $10
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 South Carolina LLC
Apart from these three steps, no major dissolution rules are there in South Carolina. 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 South Carolina includes the formation as well as dissolution fees. To dissolve an LLC in South Carolina, LLCs have to file an Article of Dissolution. The filing fee is $10. 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 South Carolina 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 South Carolina. A registered agent can help you do the needful.
Reasons Behind Dissolving South Carolina LLC
There are many ways that a company can get to the decision of dissolution. The reason can be voluntary or involuntary too. If the government is making owners dissolve an LLC in South Carolina, they will call it involuntary. But there are other reasons for the voluntary dissolution. It is important for the people to know them, so here are some of them,
- When the clients of the company are filing lawsuits against the owners.
- When the company is not able to pay money to the clients.
- If the resources of the company are mismanaged.
- No way out of the deadlock in the decisions of the company.
- Failure in the succession planning of the company.
- The owners of the company want to have a go in a new sector.
Top Businesses in South Carolina!
Want to start an LLC in South Carolina? Then it is probably best if you had a piece of proper information about all the sectors related to that. Without the proper information about it, it is impossible to start the business too. So here, let’s get you all facts and figures related to the industries of this state,
- Finance, real estate, and leasing: No one can bear a state without the industry of financing for people. Because if the people will not get to enjoy these services and get the insurance, how are they supposed to make more money? The industry contributes a lot to the state, and here it is, $34.85 billion. It is a tremendous amount that really makes a lot of difference.
- Manufacturing: We all know that how much importance this industry seems to have in the states. With the help of this, the economy of South Carolina gets $34.72 billion and gives a hike in growth too. The trade here is tremendous, which is also why people love to get employed in this sector.
- Retail Trade: We all need a trade sector in the state; it is a wholesale trade and retail trade that complete the market. With this sector, the economy can weigh in better in the GDP and provide the needed development. There is no way anyone can leave this sector behind, and in the numbers, it is not lagging. It contributes $14.97
South Carolina LLC Dissolution Review
Time needed: 5 minutes.
Here’s a recap of the steps you must follow when dissolving your South Carolina LLC. Click on the steps in this list if you want to read the full detail.
- Follow Your South Carolina 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 known to the state where your LLC operates is that you are indeed no longer in business.
What is the Cost to Dissolve an LLC in South Carolina
To dissolve an LLC in South Carolina you need to file the Articles of Termination with the South Carolina Secretary of State through mail by paying a filing fee of $10.
Dissolving an LLC in South Carolina is a multi-step process that typically involves filing paperwork with the South Carolina Secretary of State, notifying creditors and any other interested parties, and ensuring any pending liabilities are taken care of. The cost of dissolving an LLC in South Carolina will depend on the complexity of the LLC’s affairs and the number of steps required to dissolve it.
The first step in dissolving an LLC in South Carolina is to file a Certificate of Dissolution of Limited Liability Company. This document must be signed by a majority of the members of the LLC and must include the name of the LLC, the date the LLC was formed, the address of the LLC’s principal office, and a statement that the LLC is voluntarily dissolving. The filing fee for this document is $50.
Once the Certificate of Dissolution has been filed, the LLC must notify any creditors of its dissolution. This can be done by filing a Notice of Dissolution of Limited Liability Company with the South Carolina Secretary of State for publication in a newspaper. The cost of this publication varies, but typically ranges from $150 to $200.
In addition to filing the Certificate of Dissolution and notifying creditors, the LLC must also take care of any pending liabilities. These liabilities might include taxes owed to the state or federal government, unpaid wages to employees, and debt owed to creditors. It is important to note that the LLC must continue to operate until all liabilities have been paid off or otherwise discharged.
Once the LLC has taken care of its liabilities, the next step is to distribute its assets. This process typically involves a transfer of ownership of the LLC’s assets to its members. Depending on the complexity of the LLC’s assets, this process can involve a variety of fees and paperwork.
Finally, the LLC must file a final report with the South Carolina Secretary of State. This report must include information about the LLC’s assets, liabilities, and any other pertinent information. The filing fee for this report is $20.
In total, the cost of dissolving an LLC in South Carolina can range from $220 to $270, depending on the complexity of the LLC’s affairs and the number of steps required to dissolve it. It is important to note that these costs do not include any fees associated with the transfer of the LLC’s assets or any other fees that may be required. Additionally, the LLC must also bear the costs of notifying creditors and other interested parties.
Overall, dissolving an LLC in South Carolina is a multi-step process that requires filing paperwork with the South Carolina Secretary of State, notifying creditors and any other interested parties, and ensuring any pending liabilities are taken care of. The cost of dissolving an LLC in South Carolina can range from $220 to $270, depending on the complexity of the LLC’s affairs and the number of steps required to dissolve it.
Yes, in South Carolina, there is a fee of $10 to be paid for filing the Articles of Dissolution. Articles of Dissolution must be submitted to the South Carolina SOS.
No requirement of revenue department clearance is required until the SOS of South Carolina 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.
Yes, 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.
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 South Carolina. If you have any query do let us know in the comment box.