How to Dissolve an LLC in Tennessee | LLC Closing Guide


Steve Goldstein
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To dissolve a limited liability company one has to take up a set of required steps. In Tennessee, 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 Tennessee, 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.

how-to-dissolve-tennessee

If you have an LLC in Tennessee (domestic or foreign) you must have an operating agreement. The first step towards the dissolution of Tennessee 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 Tennessee LLC.

How to Dissolve an LLC in Tennessee

Dissolution of Tennessee LLC requires three broad procedural steps. Having an Tennessee LLC Operating agreement, close all the tax accounts, and finally submit the Articles of Dissolution form to the Tennessee Secretary of State.

Step 1: Follow Your Tennessee 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 Tennessee 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.

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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 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.

Tax clearance

While dissolving the Tennessee 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 Tennessee Articles of Organization, one has to file Tennessee 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 Tennessee 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 Tennessee 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.

Mail to,

Secretary of State
Corporate Filings
312 Rosa L. Parks Ave.
6th Floor, William R. Snodgrass Tower
Nashville, TN 37243

Online FIling: Tennessee Online LLC Dissolution

Filing Fee: $20


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 Tennessee LLC

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

Winding Up

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 Tennessee includes the formation as well as dissolution fees. To dissolve an LLC in Tennessee, LLCs have to file an Article of Dissolution. The filing fee is $20. 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 Tennessee 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 Tennessee. A registered agent can help you do the needful.

Reasons Behind Dissolving Tennessee LLC

Having an LLC is like having the best thing as it has less liability on the person. We have to take care of the only thing that we create legally and dissolve it legally. If the creation needed many documents, then why not do it the same way at dissolution. With the help of an acceptable manner, we don’t have to worry about any legal consequences. But why would someone want to dissolve an LLC in Tennessee? Let’s see some reasons here,

  • The business is not getting better profits like before.
  • The customer needs are increasing, and it is not possible to quench their need.
  • The owners are under great stress because of the debts.
  • Impossible to cope up with the needs of business staff.
  • Too many companies in the competition.

Top Businesses in Tennessee!

If someone is living in Tennessee, they are in for their best life. But to have the best life, people like to start an LLC in Tennessee. But to be able to have a business, it is imperative to know the perfect way to start it. The ideal way is to know about the top industries in the state. Here, let us drive you through that information,

  1. Finance industry: It is an essential sector for the state as it provides a lot of help to the people in finance. Mostly it is the real estate and banking sectors that fuel up the industry with money. This particular sector is responsible for the contribution of $52.59 billion to the GDP too.
  2. Manufacturing: There is a lot that this industry has contributed to the economy. If we show it in amounts, then it is $47.63 billion. The main thing that this industry is known for is processed foods, beverages like beer, whiskey, soft drinks, etc. There are more like transportation equipment, automobile parts, chemicals, plastics, pharmaceuticals, etc. All these things are manufactured in Tennessee, and there are even more of these. It is all about how this sector provides jobs and ensures safer development.
  3. Professional services: There are many health care centers, large hospitals, colleges of medicines and more, that make this industry whole. The state has made a great contribution to the GDP with the amount of $39.78 billion. It is an important sector and is providing a lot to the economy with it.

Tennessee LLC Dissolution Review

Time needed: 5 minutes

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

  1. Follow Your Tennessee 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.

  2. Close All Tax Accounts

    Make sure you close all your tax accounts to avoid incurring further costs.

  3. 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 Tennessee

The decision to dissolve a Limited Liability Company (LLC) is never one that business owners take lightly. It often marks the end of a journey and the termination of a business entity that was once filled with hopes, dreams, and hard work. However, when circumstances change, and business objectives no longer align with reality, it becomes essential to understand the process and cost implications of dissolving an LLC.

In the state of Tennessee, just like in any other jurisdiction, the cost of dissolving an LLC involves both financial and administrative aspects. While it is crucial to consult a qualified professional or legal expert for the most accurate and up-to-date information tailored to specific circumstances, we can explore some general avenues to help provide clarity.

To start, several administrative steps need to be taken to properly dissolve an LLC in Tennessee. These include anything from notifying all members, managers, clients, and vendors of the dissolution, conducting a final tax return, canceling any licenses or permits, and settling any remaining financial obligations such as debts, contracts, or lease agreements. Though this process may seem daunting, it is nothing insurmountable with proper planning and careful execution.

When it comes to the financial aspect of dissolution, one primary cost that LLC owners should consider is state-required filing fees. The state of Tennessee imposes a dissolution fee for LLCs, which must be paid upon filing the Articles of Dissolution with the Secretary of State. Ensuring a hassle-free experience, the state allows filing documents to be submitted online, making it more convenient and accessible for business owners. Consequently, this eliminates the need for excessive paper forms which can often complicate such processes.

Furthermore, opting for professional legal assistance is highly recommended during the dissolution process to ensure compliance with legal formalities and streamline proceedings. Although it may represent an additional expense, their expertise can be invaluable to navigate through the necessary paperwork and associated intricacies. Additionally, a legal expert will offer guidance on matters pertaining to tax, assets, contracts, and liabilities to avoid any confusion or overlooked obligations that could cause complications in the future.

Aside from these main considerations, individual circumstances may vary, further impacting the cost of dissolution. For example, if the LLC possesses significant assets, it may vital for business owners to engage an accountant or financial advisor to minimize any potential tax conductions arising from the liquidation of assets. Moreover, the complexity of contracts and legal agreements can impact the cost of dissolution. Careful examination and resolution of contracts, landlord agreements, and employee contracts are crucial to ensuring a smooth dissolution with no lingering liabilities waiting to rear their heads after the fact.

In conclusion, dissolving an LLC in Tennessee carries both administrative and financial costs, and while each dissolution case is unique, understanding the general framework can help business owners make relatively informed decisions. The administrative steps, including notifying relevant parties and settling all financial obligations, combined with state fees and potential legal assistance, form the basis of determining the total cost to dissolve an LLC. Seeking professional counsel and tailored advice from legal and financial experts in light of your specific circumstances is strongly advised to ensure a seamless dissolution process.

F.A.Qs

Is there any filing fee the LLC owner has to pay for dissolving their LLC?

Yes, in Tennessee, there is a fee of $20 to be paid for filing the Articles of Dissolution. Articles of Dissolution must be submitted to the Tennessee SOS.

Is the revenue department clearance required for dissolution?

No, there is no requirement of revenue department clearance till the time the SOS of Tennessee accepts the dissolution form.

Can someone else take the name I use for my LLC?

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.

Are there any financial penalties if I don’t dissolve my LLC legally and miss the reports?

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.

Are there any fees for the probate judge who is taking the dissolution decisions?

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.

What is the Cost to Dissolve an LLC in Tennessee

First and foremost, before even considering the cost of dissolving an LLC in Tennessee, it’s important to carefully assess the reasons behind it. While some companies may be closing due to financial hardship or other reasons, others may be looking to dissolve in order to start new ventures or partnerships. It’s essential to have a clear understanding of why the dissolution is necessary in order to navigate the process effectively and efficiently.

When it comes to the financial aspects of dissolving an LLC in Tennessee, one of the primary costs to consider is the filing fee. Depending on the specific circumstances of the dissolution, this fee can range from a few hundred dollars to several thousand. Additionally, there may be additional fees for expedited processing or other services, so it’s important to budget accordingly.

In addition to the filing fee, there are also other costs associated with dissolution to consider. One of the most significant expenses can be legal fees if you choose to hire an attorney to help navigate the process. While it’s possible to dissolve an LLC without legal assistance, having legal representation can help ensure that all necessary documents are prepared correctly and that the dissolution goes smoothly.

Another cost to consider when dissolving an LLC in Tennessee is the cost of notifying creditors and settling any outstanding debts. Depending on the financial situation of the company, this could be a significant expense that adds to the overall cost of dissolution.

It’s also important to consider the cost of winding down operations and distributing assets to members. This process can be complex and time-consuming, and may require additional financial resources to complete.

Overall, the cost of dissolving an LLC in Tennessee can vary widely depending on individual circumstances. It’s important to carefully consider all factors before beginning the process and to budget accordingly to ensure a smooth and efficient dissolution process.

In conclusion, dissolving an LLC in Tennessee can be a complex and costly process. From filing fees to legal expenses, there are a number of financial considerations to take into account when contemplating dissolution. By carefully assessing the reasons behind dissolution and budgeting accordingly, companies can navigate the process effectively and efficiently.

In Conclusion

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 Tennessee. If you have any query do let us know in the comment box.

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