Pennsylvania Dissolution
Closing your Pennsylvania company may be one of the toughest decisions you have to make. It takes courage to form a company. Deciding to close one requires the same level of bravery. However, no matter how hard it may be, you have to move on. The right way of doing that is to ensure that you close the business with the state properly.
What Is Pennsylvania Dissolution?
If you have decided to cease your business activities in Pennsylvania, your company has to inform the Department of State. To do this, it has to go through the dissolution process. Make sure your company follows the proper steps that Pennsylvania requires.
Why Does A Company Dissolve?
Why do companies need to dissolve? – Business owners in Pennsylvania created their companies with the approval of the state. Likewise, they will also have to file formal paperwork to formalize the closure. This way, the state will know that the company will no longer operate and have no more obligations to submit reports and pay business taxes.
Who makes the decision to dissolve? – Pennsylvania LLCs will depend on the decision of the members. Meanwhile, corporations will rely on the recommendation of the board of directors and the approval by the shareholders.
How long does it take to dissolve a business? – Finishing the whole process may take weeks. The way your company handles its obligations may also affect the time frame. To avoid delays, you should make sure your company accomplishes each task properly and that it always complies with the state regulations. You should also give the state 4 weeks to process your documents once they are sent in for processing.
What Happens If Your Company Does Not Formally Dissolve?
Your company continues to exist until you formally dissolve it. Thus, you will have to continue filing reports and paying taxes. Failure to comply with the necessary filings may lead to the loss of your exclusive rights to your business name even if you have not dissolved yet. Your company will also be open to claims as long as it is state-registered.
Steps To Dissolve Your Business
Make sure you follow every step carefully to make sure that your Pennsylvania business will have proper closure.
1. File Articles of Dissolution with the state – A Pennsylvania LLC must submit a completed Form DCSB:15-8975/8978 Certificate of Dissolution – Domestic Limited Liability Company, while a corporation has to use Form DSCB:15-1977/5877 Articles of Dissolution – Domestic. You may file by mail, online, or in person with the Department of State.
2. Remove all liabilities and obligations – The winding up of your company includes the liquidation of its assets. Your company has to remove its liabilities depending on the priority outline the law implements. If your company has remaining assets, you can distribute them depending on the rights and interests of members or shareholders.
3. Give notice to any claimants – Check your company records for the list of claimants. Send a written notice to their mailing addresses to let them know about the dissolution. Include in the notice necessary information, such as where and until when they can submit their claims. You may also publish a notice in a newspaper to let possible unknown claimants know about your company’s dissolution.
4. Tax clearance – Pennsylvania requires business entities to obtain a tax clearance certificate from the Department of Revenue. LLCs will also have to get a clearance from the Department of Labor and Industry’s Bureau of Employment Security. As for corporations, you will have to get clearance from the Department of Labor and Industry’s Office of Unemployment Compensation Tax Services. Fill out Form REV-181 Application for Tax Clearance Certificate to request for tax clearances.
5. Close all bank accounts, credit lines, permits, and licenses – If your company has opened business accounts in a bank, contact the bank for the requirements and process you need to do to close the bank accounts and credit lines. Additionally, check if your company has obtained various business licenses or permits with the state, region, county, or city. Cancel all of these to avoid any reporting or encountering fiscal obligations.
How DoMyLLC can assist with streamlining the process
The multi-step process of dissolution can confuse others. It also requires attention to detail. But you do not have to worry. There are experts in this field. Our team consists of professionals who are ready to provide live support. We also offer personalized solutions, so you can be sure that the service you get is suitable for your company’s needs. Contact us now and learn more.
Pennsylvania Dissolution FAQs
Is There A Filing Fee To Dissolve The Business?
The filing fee for the dissolution of a business entity in Pennsylvania is $70.
Do You Need The Department Of Revenue Clearance Before The Secretary Of State Will Accept Your Dissolution?
Yes, Pennsylvania requires business entities to obtain a tax clearance certificate from the Department of Revenue. So, LLCs need the tax clearance and a clearance from the Bureau of Employment Security. Meanwhile, corporations need the tax clearance and a clearance from the Office of Unemployment Compensation Tax Services.
How Long Does The State Take To Process The Dissolution?
The Department of Revenue will need 4 weeks to process your company’s application for tax clearance and send the certificate to you. Meanwhile, the Department of State normally takes a week to process dissolution documents.
When Can Another Business Use Your Company Name?
Another business entity can immediately request to use your company name after the Department of State processes the documents.