To dissolve a limited liability company one has to take up a set of required steps. In Washington State, 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 Washington State, 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 Washington State LLC (domestic or foreign) you must have an operating agreement. The first step towards the dissolution of Washington State 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 Washington State LLC.
On this page, you’ll learn about the following:
How to Dissolve an LLC in Washington State
Dissolution of Washington LLC requires three broad procedural steps. Having a Washington LLC Operating agreement, close all the tax accounts, and finally submit the Articles of Dissolution form to the Washington Secretary of State.
Step 1: Follow Your Washington State 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 Washington State 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 Washington State 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 Washington State Articles of Organization, one has to file Washington State 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 Washington 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 Washington 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
Secretary of State Corporation Division
801 Capitol Way S
PO Box 40234
Olympia WA 98504-0234
Online FIling: Washington State Online LLC Dissolution
Filing Fee: $20 (Online), None (By Mail)
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 Washington State LLC
Apart from these three steps, no major dissolution rules are there in Washington State. 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 Washington State includes the formation as well as dissolution fees. To dissolve an LLC in Washington State, 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 Washington State 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 Washington State. A registered agent can help you do the needful.
Reasons Behind Dissolving Washington State LLC
To make the dissolution of the company successful, the owners or the members of the company must do it legally. Without the legal actions and fulfilling the obligations, the company cannot turn dissolved. So, if you need to dissolve an LLC in Washington State, be sure to consider all the government’s duties and obligations. Okay, now we know it is essential, but what is the reason for that? Let’s check them out!
- The business is not able to cope up with the losses.
- It can also depend on the will of the company owners if they don’t want to continue.
- The business is not that good like it was in the past.
- The clients are shifting to other brands of the products.
- The company is not paying the taxes, honestly.
Top Businesses in Washington State!
To start an LLC in Washington state, the person needs to gather all information that he can. The data will allow that person to be able to make the best decision based on interest too. People cannot just get into the facts of creating a business, and they need to research it. So that is pretty much why we have provided you with the information below. Use that and understand which industry is better for your new LLC.
- Information: If we check out Washington’s economy, it is filled with funds from this sector. The contribution is $103.88 billion, and that helps the state a lot. People in the industry are the ones that have a pool of information regarding this industry. It is only information and communication technology that has brought us a lot of great aspects.
- Finance industry: The finance and insurance industry contributes $89.57 billion to the GDP of Washington state. The state is home to many banking and insurance companies, which have an astonishing reputation too.
- Manufacturing: No other industry adds value to the material that is of no use at the initial stage. So if the industry can do that, how can it leave the development of the state behind. The industry taps the GDP with a contribution of $56.91 billion too. There are so many products that the state is known for and one of them is processed food. There is a significant contribution in the aircraft and space industry of this sector too.
Washington State LLC Dissolution Review
Time needed: 5 minutes
Here’s a recap of the steps you must follow when dissolving your Washington State LLC. Click on the steps in this list if you want to read the full detail.
- Follow Your Washington State 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 Washington
To dissolve an LLC in Washington you need to file the Certificate of Dissolution with the Washington Secretary of State Corporation Division through mail, in-person free of cost or online by paying a filing fee of $20.
Title: Understanding the Hidden Costs Involved in Dissolving an LLC in Washington
Dissolving a Limited Liability Company (LLC) is oftentimes seen as a logical and natural step in the business lifecycle. However, beyond the regulatory procedures and paperwork, there are several hidden costs that can catch LLC owners off guard when looking to close their business in the state of Washington. Understanding these potential expenses is crucial in order to successfully navigate the dissolution process and minimize any unexpected financial burdens.
One fundamental factor to consider is the various fees involved in dissolving an LLC. The first financial consideration lies in the state filing fee, which every Washington LLC must pay to complete the dissolution process. This fee typically varies and can depend on several factors, such as the LLC’s structure, its assets, and pending liabilities. LLC owners must also keep in mind that legal advice fees might be necessary to ensure all legal requirements are met during the dissolution process, particularly if the LLC has complex financial entanglements or multiple owners.
Another important aspect that frequently adds to the costs of LLC dissolution is settling existing debts and obligations. Prior to officially closing the business, all outstanding liabilities, such as loans, debts, credit lines, or commercial leases, need to be addressed through proper contractual agreements and settlements. Unresolved financial obligations can result in penalties and affect the LLC’s financial standing in the long term, impacting the personal credit of its owners.
In addition, LLC owners should be prepared to handle any legal and professional obligations potentially mandated during the dissolution process. This may include hiring an experienced attorney to review and supervise the company’s termination to ensure compliance with Washington state laws. Professional assistance becomes paramount when dealing with potential claims, unresolved litigation, or pending government audits.
Furthermore, post-dissolution maintenance can also contribute to the overall cost of dissolving an LLC. It is not uncommon for LLCs to retain legal, tax, and accounting services temporarily after their official closure, mainly to avoid complications or unforeseen tax obligations from being overlooked, closing loopholes firmly, and to ensure all tax obligations are fulfilled. Such post-dissolution support is essential to guarantee a smooth transition for both the LLC and its former owners.
Lastly, it is important for LLC owners to appreciate that the costs associated with dissolving their business extend beyond the financial realm. The process can be time-consuming and emotionally challenging, requiring significant efforts and personal engagement. Engaging with stakeholders, navigating bureaucratic procedures, and ensuring smooth transitions for employees, vendors, and customers all add to the intangible costs of winding down an LLC.
In summary, dissolving an LLC in Washington involves more than simply filing paperwork — a point often underestimated. The hidden expenses outlined above including filing fees, settlement of obligations, legal and professional obligations, post-dissolution maintenance and all non-monetary costs underline the need for careful preparation and, potentially, consultation with professionals specialized in assisting with the termination of an LLC.
By acknowledging and understanding these potential costs ahead of time, LLC owners can better anticipate and mitigate the financial burdens that inevitably accompany the closure of their business venture, ensuring a smoother transition as they embark on new endeavors.
F.A.Qs
Yes, in Washington State, there is a fee of $20 to be paid for filing the Articles of Dissolution. Articles of Dissolution must be submitted to the Washington State SOS.
No, there is no requirement of revenue department clearance till the time the SOS of Washington State 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.
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 Washington State. If you have any query do let us know in the comment box.
