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Unfortunately, companies sometimes run their course and no longer yield any profit for their owners.
When that happens, you need to take care of a few important steps.
When your company was originally filed, a Certificate of Formation/Certificate of Incorporation was submitted in order to create the new entity. When it is time to close a Delaware company, a document is filed with the Delaware Division of Corporations; this document is called a Certificate of Dissolution for corporations, and a Certificate of Cancellation for LLCs.
We can make the process of closing your company as simple as possible. All you need to do is call us at 800-345-2677 or email us and we'll take it from there. We can prepare and file all the necessary documentation for you.
Before we can proceed with the filing of the documents, however, all your company's Franchise Taxes must be paid, including the current year. We can prepare a Certificate of Dissolution or Certificate of Cancellation for your signature and forward it to you via fax or email.
It must be signed by the authorized person of the LLC or an appropriate officer of the corporation. Once signed, simply return it to us by fax or email, and we will file the certificate with the state of Delaware within 24 hours.
The state typically takes 3 to 5 business days to return the receipt of filing. As soon as the approved document is available, we will forward it to you for your records. We strongly suggest clients speak with their accountant/tax professional before proceeding with a dissolution or cancellation of a company. Once the filing is approved, it is difficult to undo.
If your company has a bank account, you should close the account before filing the Certificate of Dissolution/Cancellation. If you have filed taxes with the IRS, you will need to file a closing tax return after filing the Certificate of Dissolution/Cancellation, and attach a certified copy of the certificate to your final tax return.
Please call us at 800-345-2677 or email us for more information on how to close a company.
THE AUTHOR OF THIS BLOG ARTICLE IS NOT A LAWYER AND HARVARD BUSINESS SERVICES, INC. IS NOT A LAW FIRM. THE ARTICLE ABOVE IS NOT INTENDED AS LEGAL ADVICE AND SHOULD NOT BE TAKEN AS LEGAL ADVICE. THIS SHORT ARTICLE IS STRICTLY TO MENTION SOME ASPECTS OF DELAWARE’S CORPORATION LAWS AND/OR LAWS RELATING TO OTHER FORMS OF ENTITIES WHICH YOU MAY NOT BE FAMILIAR WITH. WE RECOMMEND THAT YOU CONSULT WITH A LAWYER BEFORE FORMULATING A STRATEGY WHICH WILL BE SUITABLE FOR YOUR SPECIFIC CASE.
There are 4 comments left for How to Close a Company | Harvard Business Services, IncTomi said: Sunday, June 23, 2019
In one answer is stated that, if account with HBS is closed, llc becomes, after a period of time, forfeit inactive with the state of Delaware. Questions: - How long can/will company stay forfeit? - what happens with unpaid tax and penalty in this period of forfeited inactive company? - who is responsible to pay due taxes, if llc is without assets? Thank you for your reply. Best regards.HBS Staff replied: Tuesday, June 25, 2019
Tomi, a forfeited company in Delaware will stay in that status indefinitely; there is no time limit. This post may help answer some of your questions and you are welcome to call us for more information as well: 1-800-345-2677.george sorio said: Tuesday, May 28, 2019
Hi, I was very excited to form a Delaware corporation but my business never took off from the start. And now I owe $1570 by june 1. this are mostly due to penalty. I called 3years ago to close but I was told I cannot close the company at and she explain that I must pay first before closing. I am retired In the Philippines and I want to ask condonation of the interest or at least allow to only pay halve. I am hoping for your kind consideration. Can you please help me close my company. Thank you for your kind consideration.HBS Staff replied: Tuesday, May 28, 2019
George, if you have a Delaware corporation, the June 1 Franchise Tax does not apply to you. This is the deadline for LLCs. The corporation deadline was March 1. If you need to understand your options for closing your corporation, please contact us by email, phone, or live chat right on our website and we will be happy to assist.John kelly said: Wednesday, May 16, 2018
I need to close a company registered through Harvard called new Generation Agriculture llc Can you let me know what fee and information you require.HBS Staff replied: Thursday, May 17, 2018
Thank you for contacting Harvard Business Services, Inc. Below we have provided you with the options to close your company. Please keep in mind it is up to you as to which option best suits your needs. You may consider speaking with your CPA, accountant or attorney for advice.
Cancellation of your LLC:
In order to formally and legally close your company with Delaware, a Certificate of Cancellation must be filed and all Franchise Taxes, including the current year, must be paid. Within approximately one day of receiving payment, we will send you the Certificate of Cancellation for signature. Upon receipt of the signed forms, we will submit the filing to the state of Delaware. The filing is effective the day we file it; however, Delaware typically takes 2-3 days to return the date- stamped copy back to us. We will then email this to you for your corporate records.
The cost of the cancellation service is $450 plus each year’s Franchise Tax and filing fees. The total amount to cancel your LLC would be $750. This price quote is only valid if the filing is completed by the end of the year.
Closing your Account with Harvard:
If you don’t want to file a formal cancellation, another option we offer is to close your account with Harvard Business Services, Inc. Within approximately one day of receiving your payment of $79, we will send you a notice stating that after a minimum of 30 days, we will resign as the Registered Agent of your company. Once this filing has been submitted to the state of Delaware, there is a 30-day period in which a new Registered Agent can be appointed. If no action is taken, the company will become forfeit (inactive) with the state of Delaware.
Please note, this does not formally close your company with the state of Delaware. Any Franchise Tax fees already imposed by the state of Delaware will remain with the company. If the company is restored at a later date, a revival would need to be filed and the outstanding Franchise Tax fees would need to be paid. To proceed with the closing of your account with Harvard, the cost of this service is $79.
Please let us know how you would like to proceed and we will email you a link to an invoice so that you may make a payment. Feel free to contact our office if you have any further questions.Rahul said: Wednesday, November 1, 2017
Dear team, Can you tell me the process of cancelling a firm, I have an LLC register in Delaware. last year oct 2016? Do I need to pay tax if I have done zero business till now? Let me know the process and fee.HBS Staff replied: Thursday, November 2, 2017
Here is detailed information on how to cancel an LLC: https://www.delawareinc.com/blog/business-dissolution-two-ways-to-go-about-it/
Yes, the Franchise Tax must be paid, regardless of how much or how little business has been done with the LLC. Feel free to call us if you have additional questions.