Please note: The information on this page pertains to Delaware LLCs. If you have a Delaware corporation you wish to close, please see our "Dissolving a Corporation" page.
At some point in the business’s lifecycle, you may find it necessary to dissolve an LLC -- a process that culminates in the Delaware Certificate of Cancellation. There are a couple ways to initiate the cancellation process. Learn how in this How to Dissolve an LLC guide.
Many people use the terms "dissolving" and "cancelling" interchangeably when referring to an LLC or corporation. While both terms represent the same result (closure of the company), it is important to note that, technically, they are distinct processes.
The correct term depends on whether you are the owner of a corporation or an LLC. In Delaware, "dissolution" refers to the process of closing a corporation through the filing of a Certificate of Dissolution. LLCs, on the other hand, are "cancelled" through a Certificate of Cancellation.
While the difference in meaning is small, each process has unique paperwork that needs to be filed properly with the State of Delaware in order to close your company.
Option 1: Unanimous or Majority Vote
The process to cancel an LLC in Delaware can begin with a unanimous vote among owners. Or, depending on the terms of your Operating Agreement, you may specify how to cancel the LLC with a certain percentage of members in agreement to cancel.
Typically, the first thing business owners will want to do is talk to a tax professional and/or attorney to determine if cancelling the LLC is the best option for the company. If the circumstances call for the LLC to be cancelled, consult your LLC Operating Agreement, which usually outlines your cancellation process.
Option 2: Delaware LawWhen canceling a Delaware LLC, Delaware law allows the LLC members who collectively own more than two-thirds of the company to agree by vote to cancel the LLC.
Before you begin the Delaware LLC cancellation process, you should typically terminate all your LLC’s business affairs, such as:
The most important step in the Delaware LLC cancellation process is to file a Certificate of Cancellation.
Keep in mind, that once a Delaware LLC is canceled, the company name becomes available for anyone else in the state to utilize.
Harvard Business Services, Inc. can help you cancel your Delaware LLC in a professional and prompt manner. When you enlist our team for the Delaware LLC cancelation process, we will expertly assemble the required paperwork and forward it to you via email or fax for your signature.
After you sign and return all necessary documents to us by fax, mail or email, we will file the Certificate of Cancellation with the Delaware Secretary of State within 24 hours.
The Delaware Division of Corporations generally takes three to five (3-5) business days to return the receipt of filing to us; once we receive it, we will immediately forward it to you via email for your records.
It is very important to complete the Delaware LLC cancellation process once you’ve decided to move forward. If you do not legally and officially cancel your LLC, your company will continue to be held responsible for the annual Delaware Franchise Tax Fee as well as your LLC's annual Registered Agent Fee until either the Registered Agent resigns or until the state of Delaware voids the company.
After you’ve completed the Delaware LLC cancellation process, you may need to write a letter to the IRS, requesting closure of your LLC's EIN Number. Include the full name of the LLC, its address and a copy of the Certificate of Cancellation.
Harvard can provide assistance throughout the life of your company. These custom services are the most popular with our clients: