How do I dissolve my corporation?

The particulars depend on your state of incorporation. However, all states have procedures that must be followed when a decision is made to dissolve a corporation. An affirmative vote of the shareholders is generally required to authorize dissolution. A resolution regarding dissolution may or may not be required. Once the decision is made to dissolve, the process of winding up the corporation’s affairs is commenced. In that process, the corporation notifies creditors of the impending cessation of business and does all acts appropriate to liquidate the business, such as collecting and selling assets, discharging liabilities, and distributing any remaining assets to shareholders. The corporation may, but is rarely required to, adopt a formal “plan” of dissolution or liquidation in carrying out the winding-up process. However, all states require the corporation to file some type of form indicating that the corporation has elected to dissolve and/or has been dissolved. In addition to satisfying all state requirements, a dissolving corporation must also file with the Internal Revenue Service a return on Form 966 (Corporate Dissolution or Liquidation) within 30 days after adopting a resolution or plan for the dissolution of the corporation or executing a certificate of dissolution if no resolution or plan is required under state law. For more detailed information, see Corporate Dissolution and IRS Form 966 – How to Satisfy the Plan Requirement.