What Is Washington Dissolution?
Business entities in Washington are state-registered. Thus, they have to go through the process of dissolution to formally cease their operations within the state.
Why Does A Company Dissolve?
Why do companies need to dissolve? – When you formed your company in Washington, you had to file formal paperwork to register it with the state. Likewise, the state also requires businesses to submit paperwork when they decide to close. Through this, your company informs the state that your business entity will no longer exist or have filing and tax obligations.
Who makes the decision to dissolve? – The decision to dissolve an LLC in Washington lies on its members. Meanwhile, a Washington corporation requires its board of directors to adopt a resolution. The said resolution will be up for the vote of shareholders.
How long does it take to dissolve a business? – The time a company will spend on finishing the whole process will depend on how it handles the tasks. You can start as soon as the company finalizes its decision to dissolve. After accomplishing the initial actions, you have to give the state 4 weeks to process the documents. If your company is a corporation, you may have to wait longer because you have to wait for the tax clearance from the Department of Revenue.
What Happens If Your Company Does Not Formally Dissolve?
Your business entity will continue to exist until proper dissolution. Thus, it will continue to have liability to file necessary reports and pay taxes. Additionally, failure to dissolve leaves your company vulnerable to claims against corporate acts in the past.
Steps To Dissolve Your Business
Make sure you follow each step carefully to avoid having problems when dissolving your company in Washington.
1. File Articles of Dissolution with the state – A Washington LLC has to submit a completed Certificate of Dissolution, while a corporation has to file Articles of Dissolution. Submit the form by mail, fax, or in person to the Secretary of State.
2. Remove all liabilities and obligations – Your company can designate one or more members or officers to handle the winding up affairs. Liquidate all assets of the company and settle all its obligations. In doing this, your company must follow the priorities outline that the law has set. If your company has remaining assets after, distribute them according to ownership interests.
3. Give notice to any claimants – Notify all known creditors and claimants. You can check the records of the company to find out who and where to send written notice. Make sure the notice includes information on where and until when they can submit claims. You may also publish the notice in a newspaper.
4. Tax clearance – Washington does not require LLCs to secure tax clearance before dissolving. As for a corporation, your company will have to submit a Department of Revenue Clearance Certificate along with the Articles of Dissolution. You may request this by filing a Revenue Clearance Certificate Application to the Audit Division of the Department of Revenue.
The Department of Revenue will review the tax status of your corporation. If your company does not have pending tax obligations, the department will send the Revenue Clearance Certificate to you.
5. Close all bank accounts, credit lines, permits, and licenses – If there are any business accounts under your Washington company, close them after settling all obligations. Additionally, check if your company has business licenses and permits. Cancel all of these to avoid fiscal obligations.
How DoMyLLC can assist with streamlining the process
If you are worried about the process of dissolving your business in Washington, you can turn to a professional. Our team can handle the paperwork for your company. We also offer live support and personalized solutions. Contact DoMyLLC now and find out which of our services will fit the needs of your Washington company.
Washington Dissolution FAQs
Business entities in Washington do not have to pay a fee for the dissolution of their companies. However, your company has to pay $20 if you request expedited service. The Secretary of State considers all fax filings as expedited service requests.
If your company is an LLC, you will not have to obtain tax clearance. Only corporations have to submit them.
The Secretary of State usually takes 4 weeks to process dissolution documents. If you file through fax or request expedited service, they will finish processing the documents in a week. Corporations may have to wait longer because they have to obtain tax clearance first. It may take up to a month before your company receives the tax clearance certificate from the Department of Revenue.
Your business name will be available for use of another entity a day after the dissolution.
Washington Business Resources
Washington Office of Secretary of State
Washington Secretary of State
801 Capitol Way S PO Box 40234
Olympia, WA 98504-0234