What Is South Carolina Dissolution?
The dissolution process is something a business entity has to go through to end its existence officially in South Carolina. It is the proper way to formalize the closure of the business and put an end to its obligations.
Why Does A Company Dissolve?
Why do companies need to dissolve? – Your South Carolina company had to register with the Secretary of State when you decided to start conducting business within the state. Because of this, it is now in the register of the state. Thus, you will have to inform the state if your company has decided to end all its activities. South Carolina requires companies to submit formal paperwork.
Who makes the decision to dissolve? – The dissolution of a South Carolina LLC requires the approval of the members. On the other hand, corporations in the state will need a resolution that the board of directors approved. Said resolution will be voted on by the shareholder during a meeting.
How long does it take to dissolve a business? – The time it takes for a South Carolina company to complete all processes depends on how you handle each step. The sooner your company decides to dissolve, the earlier you can start. Aside from the initial actions, you also have to give the state 2 days to process your documents.
What Happens If Your Company Does Not Formally Dissolve?
If your company does not follow the dissolution process of South Carolina, it continues to exist. Thus, it will still have obligations with the state. Formally dissolving the business will help you prevent having any issues with the state.
Steps To Dissolve Your Business
South Carolina requires business entities to follow certain steps to dissolve properly.
1. File Articles of Dissolution with the state – LLCs in South Carolina have to file completed Articles of Termination, while South Carolina corporations have to submit completed Articles of Dissolution. File the forms in duplicate, along with a self addressed stamped envelope, with the Division of Business Filings of the Secretary of State by mail, UPS/FedEx, or in person.
2. Remove all liabilities and obligations – The company can designate certain members or officers for the winding up. Under this process, your company has to conduct various tasks. These tasks include the collection of assets, disposal of properties that the company will not distribute in kind, creation of provisions to pay obligations, and distribution of remaining assets.
3. Give notice to any claimants – Inform known claimants and creditors where they can submit their claims. You can check the record books of the company for the addresses of claimants so you can send a written notice to them. You may also inform unknown claimants by publishing a notice in a newspaper. This published notice may also serve as evidence in case you encounter queries about claims.
4. Tax clearance – South Carolina does not require business entities to obtain tax clearance. However, corporations have to file final returns with the Department of Revenue if the accounting period has already ended when they dissolve the business. Additionally, if the Secretary of State has administratively dissolved the corporation you are trying to dissolve, you have to include a Tax Compliance Certificate with the filing documents. You can download the form on the website of the Department of Revenue.
5. Close all bank accounts, credit lines, permits, and licenses – To protect yourself from possible legal issues, close all bank accounts under the name of your company. You also have to cancel all permits and licenses that your company secured when it started its operations.
How DoMyLLC can assist with streamlining the process
Closing your business in South Carolina requires you to follow a process. If you need professional advice, you can rely on our team. We offer personalized solutions and live support. Contact us now and let us handle the process of dissolving your South Carolina company.
South Carolina Dissolution FAQs
Is There A Filing Fee To Dissolve The Business?
The filing fee for the dissolution of a business entity in South Carolina is $15.
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 from the Department of Revenue. Only corporations that the Secretary of State has administratively dissolved will need a Tax Compliance Certificate.
How Long Does The State Take To Process The Dissolution?
The Secretary of State normally takes 2 business days to process dissolution documents. However, your company may have to wait longer if the office is unusually busy.
When Can Another Business Use Your Company Name?
Your business name will only be available for use 120 days after the dissolution.