How to Dissolve a Delaware Corporation

How to Dissolve a Delaware Corporation

Dissolving a Delaware corporation involves more than filing a Certificate of Dissolution with the State. The corporation must also satisfy its Delaware Franchise Tax and Annual Report obligations through the year of dissolution.

Generally, the process includes the following steps.

1. Obtain the Required Corporate Approval

A corporation must properly authorize its dissolution in accordance with applicable Delaware law and its governing documents.

Harvard Business Services does not obtain or verify shareholder, director or other internal corporate approval as part of our dissolution filing service.

If you're unsure what approvals your corporation requires before proceeding with a dissolution, you should consult a qualified attorney.

2. Satisfy Delaware Franchise Tax and Annual Report Requirements

A corporation must satisfy its Delaware Franchise Tax and Annual Report obligations through the year in which the corporation dissolves. This includes any outstanding obligations from prior years as well as the Franchise Tax and Annual Report requirements for the year of dissolution.

For example, a corporation dissolving in 2026 must address any outstanding obligations from previous years as well as its 2026 Delaware Franchise Tax and Annual Report.

Our Filings Team will review the corporation's Delaware status and tax history to identify the Franchise Tax and Annual Report requirements that must be addressed as part of the dissolution.

The amount of Franchise Tax due varies by corporation. In some cases, additional information may be required to calculate the tax. This may include information such as the corporation's gross assets and issued shares. If additional figures or documentation are required, our Filings Team will let you know what information is needed before the dissolution can proceed.

3. Confirm the Dissolution Filing and Cost

For a standard for-profit corporation, eligibility for a short-form dissolution depends in part on its Delaware Franchise Tax history. Generally, the short form is available when the corporation has only been assessed and paid the minimum Franchise Tax for each year of its existence.

Our Filings Team will review the corporation's Delaware record and tax history to confirm whether the short-form filing is available or whether the long-form Certificate of Dissolution is required.

This review also allows us to identify the corporation's Delaware Franchise Tax and Annual Report obligations and provide an accurate quote for completing the dissolution.

4. Prepare and File the Certificate of Dissolution

Once the corporation's Delaware status and tax requirements have been reviewed and we have received any additional information needed to proceed, our Filings Team will prepare the applicable Certificate of Dissolution and send it electronically for your signature.

Once the signed documents are returned, we will submit any required Franchise Tax payment and Annual Report and file the Certificate of Dissolution with the Delaware Division of Corporations.

Our Filings Team typically requires approximately two business days to prepare the dissolution documents once all required information has been received.

After the filing is submitted, processing time will depend on the Delaware Division of Corporations' current workload and the processing service selected. If time is of the essence, we can purchase expedited service from the Delaware Division of Corporations at an additional cost.

5. Address Other Registrations and Business Obligations

Dissolving the Delaware corporation does not necessarily close every account, registration or obligation associated with the business.

If the corporation is qualified to do business in other states, separate withdrawal or termination filings may be required in those jurisdictions.

The corporation may also need to address matters such as outstanding debts and contracts, employees, creditors, bank accounts, licenses and permits, federal and state tax accounts, and remaining company assets.

If the company owns real estate, that will also have to be dealt with separately before the filing.

Because these requirements depend on the corporation's individual circumstances, business owners should consult appropriate legal and tax professionals when necessary.

How Much Does It Cost to Dissolve a Delaware Corporation?

There is no single price that applies to every Delaware corporation dissolution.

Before providing the total cost, our Filings Team reviews the corporation's Delaware record and Franchise Tax history. The total may vary based on:

• Whether the corporation qualifies for a short-form dissolution or requires a long-form Certificate of Dissolution
• The applicable State of Delaware filing fee
• Any prior-year or current-year Delaware Franchise Tax and Annual Report obligations, including applicable penalties or interest

In some cases, additional information, such as gross assets and issued shares, may be required before the corporation's Franchise Tax can be calculated.

Once the required information is available, our Filings Team can provide the cost to complete the Delaware dissolution process.

Why Is It Important to Formally Dissolve a Delaware Corporation?

Simply abandoning a corporation or stopping business operations does not formally dissolve the company.

Until the corporation is properly dissolved, Delaware compliance obligations may continue, including Franchise Taxes, Annual Reports and Registered Agent fees.

Formally dissolving the corporation with the State of Delaware establishes the corporation's dissolution on the State's records and can prevent future annual Delaware obligations from continuing to accrue.

What Happens After a Delaware Corporation Is Dissolved?

Receiving the filed Certificate of Dissolution from Delaware does not necessarily mean every aspect of closing the business is complete.

Depending on the corporation, additional steps may include:

• Filing final federal, state or local tax returns
• Closing tax accounts
• Closing business bank accounts
• Resolving outstanding debts or contractual obligations
• Distributing remaining assets
• Canceling licenses and permits
• Withdrawing registrations in other states
• Dealing with the company's assets including Real Estate and intellectual property

Business owners should consult a qualified accountant, tax professional or attorney regarding requirements specific to their corporation.

Ready to Dissolve Your Delaware Corporation?

Whether you're an existing HBS client or not, our Filings Team can review the corporation's Delaware record, identify the information and Delaware obligations required to proceed, prepare the applicable dissolution documents and submit the completed filing to the Delaware Division of Corporations.