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People often ask, "Why go through the formal dissolution of a corporation process instead of simply leaving the company behind?"
It's important to dissolve a company in order to end the corporation's responsibility for future annual Franchise Tax payments and Registered Agent Fees.
If your Delaware corporation is no longer in use, you should inform the state by filing a Delaware Certificate of Dissolution so the company is no longer held liable for either Franchise Tax or Registered Agent Fees.
Since the corporate dissolution filing is difficult to reverse, business owners generally prefer to speak with a tax professional or accountant before beginning the process.
Those that would like to proceed to dissolve a Delaware corporation will need to pay a company dissolution fee as well as file all Franchise Tax reports and pay all Franchise Tax dues, including any late penalties and interest, before the company can be dissolved.
Generally, if a corporation has a bank account, the business will often close the bank account before filing the Certificate of Dissolution.
A Certificate of Dissolution must be issued by the state of Delaware in order to formally dissolve a corporation.
Once you contact us and your payment is submitted, we will prepare all the necessary documentation and submit it to you by email or fax for your signature.
It is important to note that the documentation must be signed by an officer of the corporation. After it's signed and returned to us by mail, email or fax, the Certificate of Dissolution will be filed with the state of Delaware within 24 hours.
The state typically takes three to five business days to return the receipt of filing. Once we receive it, we will forward it to you by email for your records.
If the corporation has filed taxes with the IRS, a closing tax return will generally need to be filed after receiving the Certificate of Dissolution; attach the Certificate of Dissolution to the final tax return.
If you need assistance filing a closing tax return, please consult a tax professional or accountant.
For more information on how to dissolve a company, or to begin the corporate dissolution process, please contact our helpful staff by phone (800-345-2677), email or live chat, and we'll be happy to assist.
The HBS Blog offers insight on Delaware corporations and LLCs as well as information about entrepreneurship, startups and general business topics.
Harvard can provide assistance throughout the life of your company. These custom services are the most popular with our clients: