To dissolve a limited liability company one has to take up a set of required steps. In Virginia, 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 Virginia, 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 Virginia LLC (domestic or foreign) you must have an operating agreement. The first step towards the dissolution of Virginia 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 Virginia LLC.
On this page, you’ll learn about the following:
- How to Dissolve an LLC in Virginia
- After Dissolving Your LLC
- Reasons Behind Dissolving Virginia LLC
- Virginia LLC Dissolution Review
How to Dissolve an LLC in Virginia
Dissolution of Virginia LLC requires three broad procedural steps. Having a Virginia LLC Operating agreement, close all the tax accounts, and finally submit the Articles of Dissolution form to the Virginia Secretary of State.
Step 1: Follow Your Virginia 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. Virginia 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 Virginia 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 Virginia Articles of Organization, one has to file Virginia 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 Virginia 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 Virginia 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.
State Corporation Commission
Office of the Clerk
P.O. Box 1197
Richmond, Virginia 23218-1197
Online FIling: Virginia Online LLC Dissolution
Filing Fee: $25
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 Virginia LLC
Apart from these three steps, no major dissolution rules are there in Virginia. 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 Virginia includes the formation as well as dissolution fees. To dissolve an LLC in Virginia, LLCs have to file an Article of Dissolution. The filing fee is $25. 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 Virginia 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 Virginia. A registered agent can help you do the needful.
Reasons Behind Dissolving Virginia LLC
Dissolving an LLC is not a difficult task if the person does it adequately. When someone dissolves their company, they are declaring their company inactive and out of operation. To do that and dissolve an LLC in Virginia, it is vital to know its reasons. Let’s take a look at those reasons here,
- If the company fails to pay the registration fee of the company or any other related fee.
- The company’s will says the time being of operation of the business has come to an end.
- An owner of the company needs to leave the company.
- The other members of the company are involuntarily removing a member of the company.
- There is no profit for the business from the past years.
- The economy is not in favor of the company at all.
Top Businesses in Virginia!
The state’s diverse economy makes it perfect to start an LLC in Virginia and thrive with it. The state’s service sector is getting a lot of importance, driving the economy to the road of development. With the help of this specific thing, we can learn the best way to operate the business. All you need is the facts of industries; then, it will be effortless to go forward. Here, check them here below,
- Professional and business services: The state’s service sector related to personal business makes a lot of effort for the economy. We can get to know that with the help of the amount of contribution to the GDP, i.e., $103.23 billion. The growth is with the use of technology in the business and internet service.
- Government enterprises: There are different government enterprises in the state, increasing the economy by $84.81 billion. There are shopping centers, real estate markets, hospitals, and military bases under this one. With that, it is easy for people to get the service and go nowhere else.
- Manufacturing: The industry of manufacturing leads the economy by $40.3 billion to develop. The sector helps the raw material become useful for people and the money for the state. So it is a win-win situation for all. Many products like processed food products, chemicals, transportation equipment, etc., are well-known.
Virginia LLC Dissolution Review
Time needed: 5 minutes.
Here’s a recap of the steps you must follow when dissolving your Virginia LLC. Click on the steps in this list if you want to read the full detail.
- Follow Your Virginia 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 Virginia
To dissolve an LLC in Virginia you need to file the Articles of Cancellation with the Virginia State Corporation Commission through mail, in-person or online by paying a filing fee of $25.
If you have an LLC in Virginia, you may be wondering how much it costs to dissolve it. The answer is dependent on the steps you take and whether you are going to voluntarily or involuntarily dissolve your LLC.
A voluntary dissolution is a decision made by members and managers of the LLC. In Virginia, the owners of an LLC must file a notice of their intent to close their business with the State Corporation Commission. They must also notify creditors and known business associates of the intent to close.
You must prepare your business for closure by resolving any outstanding financial obligations and closing your accounts. This includes paying off any debts and distributing any assets. You must also contact your tax agencies to inform them of your plans. Failure to do so could result in penalties and interest from the agencies.
In Virginia, you can dissolve your LLC by following a few simple steps. Depending on the nature of your business, you may need additional documents to complete the closing process. An experienced attorney can assist you in the legal procedures required to dissolve your business.
One of the most important documents you must submit when completing the dissolution process is the Articles of Cancellation. This form is available online and requires a $25 filing fee. You can also file by mail, but you will need to allow up to two weeks for processing.
The next step in the dissolution process involves making a public announcement of your intention to close your business in a newspaper or other public outlet. You can also send a notice to all creditors, including the state and federal tax agencies, in order to let them know of your intentions. However, you will need to consult a Virginia business dissolution lawyer before you actually start the process.
Finally, you must pay all taxes that you owe on your business. For example, if you have been a business entity in Virginia, you have to pay your annual registration fees, along with any other fees due to the state or the SCC. It is not enough to simply pay the fees, however. Any outstanding taxes that you owe on your business must be paid before you can close your accounts.
To get started, visit the Virginia State Corporation Commission’s website to obtain the required forms. Once you have filled them out, you can either scan and submit them online or print them out and mail them. Regardless of how you choose to submit your articles of cancellation, you must include the exact date of the registration, the official name of your business, and the date and signature of the person who signed the document.
While you can dissolve your LLC in Virginia, the process is not as straightforward as it seems. If you make a mistake, you can run into serious legal issues, and you may end up being personally liable for any debts incurred by your business.
Yes, in Virginia, there is a fee of $25 to be paid for filing the Articles of Dissolution. Articles of Dissolution must be submitted to the Virginia SOS.
No, there is no requirement of revenue department clearance till the time the SOS of Virginia 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 Virginia. If you have any query do let us know in the comment box.