The 4th quarter of the year has arrived. For some, it is time to start thinking about future business goals. However, for others, it may be time to consider officially closing your company, which is called cancellation for a Delaware limited liability company and dissolution for a Delaware corporation. Harvard Business Services, Inc. can explain how to cancel your LLC or dissolve your corporation.
We file thousands of companies each year, and the unfortunate truth is that not all of those companies will continue to operate year after year. While we don’t like to see a business close, we do appreciate the opportunity to serve as your Registered Agent, and we are here to help you officially close your company, if you deem it necessary.
For those businesses that will not be operating in the next year, now is the time to consider a cancellation or dissolution. Officially filing the Certificate of Cancellation or Certficiate of Dissolution before the first of the year will save you from paying another whole year of Franchise Tax.
This is how it works: The Delaware Franchise Tax is due on March 1 for a corporation and on June 1 for an LLC. However, Franchise Taxes are paid for the previous year. So when you pay Franchise Taxes in 2015, you are paying for the 2014 calendar year. These taxes are not pro-rated; that is, if your company is in legal existence even one day in 2015, you must pay the entire year’s Franchise Tax when you cancel or dissolve it.
Contact our friendly customer service specialists at Harvard Business Services, Inc. for help with this service. We will prepare a Certificate of Cancellation or Dissolution for signature, and forward via fax or email—or you can authorize us to use the conformed signature option. Once signed, we will file the Certificate with the Delaware Division of Corporations. The state typically takes three to five business days to return the receipt of filing. As soon as the approved Certificate of Cancellation or Certificate of Dissolution document is available, we will forward it to you for your records.
This document is the official legal document proving the company has been legally closed. Your bank will ask for it when you close your company's bank accounts. Your accountant will also need the document to include with your final tax return to the IRS, which is a federal IRS requirement.
If you would like Harvard Business Services to cancel a Delaware LLC or corporation for you, simply call us at 1-800-345-CORP.
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.