Everyone at Harvard Business Services appreciates the opportunity to help entrepreneurs from all over the world start companies to fulfill their life’s dreams. However, not all businesses are successful. In fact, more than 60 percent of the 100,000 companies we’ve formed over the past 33 years have ceased business along the way.
It is important to minimize the loses incurred when winding down the operation. Want to know how to cancel a Delaware LLC without paying a lot? Here’s one way to trim those costs: You can save $50 if you cancel your Delaware LLC before July 1.
On April 15, 2014, Delaware's Governor Jack Markell signed an increase of the Delaware corporation and LLC franchise tax for the 2014 franchise tax year. (The franchise tax, which is due on June 1 of every year, is the price paid to Delaware for the right or privilege to have a Delaware LLC.) As of July 1, 2014, all Delaware LLCs will pay $300 per year compared to the $250 for previous years. However, if you want to cancel the LLC, now is the time to act! By filing the cancellation with the Division of Corporations before July 1, 2014, the $50 increase will not apply and only the $250 franchise tax for 2014 would need to paid.
Harvard Business Services offers a service to help you. Through this service, we will prepare the Certificate of Cancellation as well as pay the state of Delaware filing fee and 2014 franchise tax. The document will be drafted and emailed for a signature of just one member. Once executed by the member, the document can be emailed, faxed, or mailed back to our office.
The filing is then made with Delaware Division of Corporations and approved with the time/date stamp from the Division of Corporations, Secretary of State’s office. This document can be provided to the bank, vendors, and government agencies showing that the LLC no longer has a legal existence.
Once the cancellation is processed, the next step is to inform the IRS. Clients can close the EIN by writing a letter addressed to: Internal Revenue Service, Cincinnati, Ohio 45999. In the statement, include an explanation as to why the EIN needs to be closed, the EIN number, the address of the LLC, and the correct name of the LLC. Clients will typically enclose a copy of the Certificate of Cancellation from the state of Delaware that we will provide.
It is very important to follow the procedures to officially cancel an LLC. We will help guide you through the process and save you $50 by acting before July 1, 2014! Please call (800-345-2677), email, or live chat with us for assistance.