Dissolution of business could be for variety of reasons for example: bankruptcy, retirement, or a change in career direction. When a business entity is no longer doing business or even if it was never used for anything, it is very important that it follows the legal steps in "winding itself up" as a legal entity.
A business Corporation, S Corporation or an LLC is an entity created under authority granted by the state. Its existence may only be terminated by the state. The Business Law provides a procedure for dissolving a corporation or an LLC. All legal entities can only be dissolved through formal action, not by a letter or phone call. You remain liable for all taxes, assessments, fines, penalties and interest until you receive a certificate of dissolution from the Secretary of State.
There are typical actions that are taken when closing a business on Federal and State Level:
Federal (IRS)
* You must file an annual return for the year you go out of business.
* If you have employees, you must file the final employment tax returns.
* Make final federal tax deposits.
* File final quarterly or annual employment tax form.
* Issue final wage and withholding information to employees.
* Report information from W-2s issued.
* File final tip income and allocated tips information return.
* Report capital gains or losses.
* Report partner's/shareholder's shares.
* File final employee pension/benefit plan.
* Issue payment information to sub-contractors.
* Report information from 1099s issued.
* State (Where your business is formed):
* You must file an annual return for the year you go out of business.
* If you have employees, you must file the final employment tax returns with your State.
* Make final State tax deposits.
* File final quarterly or annual employment tax form.
* If you collect Sales Tax in your State. File final Sales Tax Return.
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Dennis
25th Jan 2013
My name is Dennis, In 2010 a friend and I started a LLC. I had no experience, but he did,so he filed the articles of organization. In 2012 we had a accident and are insurance co.would not cover the claim saying it was a act of god. But are customer wanted us to pay for the damages it was a large amount so my friend panicked. He wanted to close it down. I had a different idea and wanted to keep it going. So I bought him out. But when I went to change agent and address on the LLC I found out that he already dissolved it with out my consent I could start it back up with the same name, but this is a trucking co. And there are a lot of expensive fees. I tried to fill out a certificate of correction (BCS518) but was not able to because I wasn't on the articles of organization that he filled out back in 2010. I need my ex partner to sign the certificate of correction. The LLC is in the state of Michigan. What if he does not want to sign, what can I do.
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