How To Close An LLC In TX
Dissolving an LLC or Corporation in Texas is not difficult, but just like setting up a new company, it does take time and attention to detail.
First, you will need to “wind up” the entity’s affairs. You will need to stop advertising and signing up new business, completing any unfinished business, paying the outstanding debts, collecting and distributing the company assets, filing final tax returns and then filing a certificate of termination with the Secretary of State. You will want to make sure that you also terminate the entity’s registration in any other state in which the company has operated.
Texas LLC Dissolution Statute
As you begin this process, be aware that if there are company debts which are not paid, and any of the owners receive company property, they will incur personal liability to the extent of either the amount of the debt, or the value of the property they received, whichever is less. This just means that you can’t close up shop, take home the inventory, and walk away from the unpaid creditors. If there are assets, you have to make sure the creditors get paid out of those assets before the owners. As a part of that process, you might want to take a look at the books and records, to make sure that they are complete and accurate, and that they will continue to be accessible to you later, in case you need to show what happened to the assets.
Once you think you’ve gotten those issues under control, file the final federal income tax return, and make sure your Texas state franchise taxes have been paid, and file any necessary tax returns in other states. One reason for this is that in order to dissolve the entity with the Secretary of State, you’ll need to have a Certificate of Account Status from the Texas Comptroller’s office, showing that all franchise taxes have been paid. This can be the most time-consuming part of filing a dissolution, and can take at least two weeks. There is a form available online to request the certificate, and you should know that a print out from the Comptroller’s website will not be sufficient.
What Happens To Assets When An LLC Is Dissolved
Forms for terminating an entity are available on the Secretary of State’s website, along with the filing fees for each. You’ll file the certificate of dissolution, along with the Certificate of Account Status and the filing fee, and make sure they’ve been accepted. Congratulations, you no longer have an active entity!
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Frequently Asked Questions
In Texas, how much does it cost to dissolve an LLC?
Dissolving an LLC has a few costs assoiated with it. You will be charged by the Secretary of State, and you may also incur certain legal fees. As far as the Secretary of State charges go, you may pay electronically when you submit the forms if you submit them through the website. And you should call our office immediately to determine what attorney fees you might incur.
In Texas, how do you dissolve an LLC?
You can file a Certificate of Termination with the Secretary of State to dissolve your Texas LLC. There is a small filing fee. The form can be completed and submitted online. You can hire us to dissolve your LLC for you if you would like to save some time. Give us a call for a consultation.
In Texas, does an LLC have an expiration date?
A limited liability company's articles of organization may allow its members to designate the duration of the company. An LLC's expiration date can be specified but if no expiration date is specified, the LLC might continue indefinitely.