What Is Louisiana Dissolution?
The process that company has to do to formalize and legalize the company’s closure is known as dissolution. It informs the state to remove the company from the register of businesses operating in the state.
Why Does A Company Dissolve?
Why do companies need to dissolve? – Louisiana requires business entities to submit formal paperwork to close a state registered company. It will inform the state that the company will no longer be liable to file reports and pay for fees and taxes.
Who makes the decision to dissolve? – LLCs require the votes of members. Corporations need the votes of the shareholders. Louisiana does not require the board of directors to submit a resolution to the shareholders. However, many corporations still do this common practice.
How long does it take to dissolve a business? – It may take a few weeks to finish the whole process. However, this time frame may change depending on how fast your company finishes each necessary step. As for the state processing of your documents, it may vary depending on the staff’s workload. The normal processing time is 7 business days.
What Happens If Your Company Does Not Formally Dissolve?
Failure to dissolve your company formally means it will continue to exist in the state register. Thus, it will still be liable for filings, taxes, and all its acts in the past. Louisiana put companies that fail to comply with the requirements in bad standing. Additionally, you will remain vulnerable against possible claims against the company until the dissolution is completed.
Steps To Dissolve Your Business
To dissolve a business, your company will have to go through the process that the state of Louisiana has set.
1. File Affidavit to Dissolve with the state – To close your LLC in Louisiana, you have to submit by mail or in person a notarized Affidavit to Dissolve Limited Liability Company along with the filing fee. Alternatively, your company may also file online through the website of the Secretary of State. You will have to provide the name of the LLC, the country or parish where you registered it, and the signature of all members.
On the other hand, corporations must file a notarized Affidavit to Dissolve Corporation form and send it to the Secretary of State along with the filing fee by mail, fax, or in person. If your company decides to file the document online, it does not need notarization.
If your corporation has no debt and immovable property at the time, it will do short-form dissolution and go on with the filing of the affidavit. Otherwise, it has to do long-form dissolution, which requires the publication of a Notice of Authorization of Dissolution and the filing of a Certificate of Dissolution with the Secretary of State.
2. Remove all liabilities and obligations – Under the LLC Act of Louisiana, LLCs have to pay for all their debts and liabilities. These include all costs and expenses of the liquidation process and other contingent liabilities, and the distribution of remaining assets to the members.
Corporations must also do the same. However, those that have to undergo the long-form dissolution have to appoint a liquidator after the publication of the Notice of the Authorization of Dissolution and filing of the Certificate of Dissolution. After completing the necessary tasks, the liquidator has to sign a certificate and submit it to the Secretary of State.
3. Give notice to any claimants – Louisiana requires business entities to give notice to known creditors and claimants by registered or certified mail. It also requires the publication of a notice in a newspaper of general circulation in the location of your company’s registered office for 2 consecutive weeks. The rules of the state for the notice to creditors and other claimants are complicated. You may need the help of a professional for this task.
4. Tax clearance – Louisiana does not require business entities to obtain tax clearance before dissolution. However, the Secretary of State checks for corporations’ certificates from the Department of Revenue and Louisiana Workforce Commission. This may require additional paperwork to be submitted to complete the dissolution.
5. Close all bank accounts, credit lines, permits, and licenses – Contact the bank to find out how you can close all business accounts. Additionally, you should also cancel all the licenses and permits of your company to protect your finances from possible issues.
How DoMyLLC can assist with streamlining the process
The dissolution process in Louisiana is complex. You may need someone who can assist you as you go through each step. We will handle the filing of your documents and ensure that your company complies with the rules the state has set. Contact us now for a personalized solution or live support with our team of experts.
Louisiana Dissolution FAQs
Is There A Filing Fee To Dissolve The Business?
Dissolving a Louisiana LLC comes with a $75 filing fee. Corporations need to pay $60. Expedited processing requires an additional $30.
Do You Need The Department Of Revenue Clearance Before The Secretary Of State Will Accept Your Dissolution?
No, you do not need a tax clearance. However, once the dissolution is submitted the state will notify the Department of Revenue and Louisiana Workforce Commission. These departments may require additional paperwork to complete the dissolution.
How Long Does The State Take To Process The Dissolution?
Normal processing takes approximately 7 business days, while expedited service is around 24 hours.
When Can Another Business Use Your Company Name?
Another entity can use your business name immediately after the dissolution.