What is it that you need to do when you want to dissolve a company in Colorado? Well, that depends on a few different factors.
- What type of business entity is being dissolved?
- Are there any remaining assets in the business, and will there need to be a liquidation?
- Are there any outstanding debts?
- Are the Colorado business owners all in agreement about dissolving the company?
We cover how to dissolve a business in Colorado the correct way by providing you with the appropriate forms, information about the dissolution process, and what to do if you change your mind and need to undo a dissolution of your company.
How to Dissolve an LLC in Colorado
How much does it cost to dissolve an LLC in Colorado? Well, as a business owner, you will have to file a Statement of Dissolution with the Colorado Secretary of State. Filing a Statement of Dissolution in CO will cost you $10, which will usually take up to 30 business days to go through.
- These articles must include the LLC’s name, the effective date of the company’s dissolution, what led to the company’s dissolution, and the information (name, address, and signature) of the person appointed with dissolving the company if the company has no members.
- The appropriate form to dissolve an LLC in Colorado can be found here.
- If you are interested in restoring a dissolved LLC in Colorado, you must file for an Amend and Restate Articles of Organization before the company is terminated, once the LLC has been officially terminated there is no going back.
Dissolving an LLC in Colorado is required by law, and the process to dissolve a business in Colorado is relatively complex. You will need to complete multiple steps before entering a proper Colorado LLC dissolution. To eliminate potential liability, lawsuits, and additional fees, you should consider using the services of a Business Filing Services Company that can affordably dissolve your Colorado LLC for you.
How to Dissolve a Corporation in Colorado
A corporate dissolution (for a C-Corporation or S-Corporation) in Colorado can be done whether a company has issued shares or has not yet issued shares.
- If a company has issued shares, the Articles of Dissolution must be adopted by a majority of the shareholders.
- If the company has not yet issued shares, the dissolution must be approved by a majority of the business owners or the Board of Directors of the company.
The appropriate forms to dissolve a company can be found here, this is the specific form you will need to fill out in order to file for an article of dissolution for a Colorado corporation.
The restoration of a dissolved corporation (C-Corp, S-Corp, or Non-Profit) must occur before the official termination of the business via the dissolution process.
To dissolve a Corporation in Colorado, there are some requirements and non-compliance that can lead to serious legal consequences. To dissolve your Colorado Corporation the right way, you should consider using the services of a Business Filing Services Company that can do this for you at an affordable, flat fee.
How do I Dissolve a Partnership or Sole Proprietorship in Colorado?
The methods for discontinuing businesses in Colorado really are dependent on how it has been legally organized and the business structure itself. So, for a Sole Proprietorship in Colorado, you will not have to file a form, there are no state-mandated formal requirements to shut up shop for these types of businesses in Colorado.
The process is simple, you must pay any outstanding debts, there is no formation paperwork or dissolution paperwork to fill out, once the debts have been taken care of, you simply terminate accounts, cancel your fictitious or other business name and move on. This means that you literally do not have to officially dissolve a Sole Proprietorship in Colorado.
For Partnerships in Colorado, the dissolution process is a little bit different. LLLP’s (Limited Liability Limited Partnerships) and LLP’s (Limited Liability Partnerships) have the exact same process for closing a business as Sole Proprietorships, so, all you would need to do is follow the instructions above. However, LP’s (Limited Partnerships) require the owner to file for a Statement of Dissolution which will cost $10, and then for LPA’s (Limited Partnership Association) you will need to file for Articles of Dissolution for the same price.
Common Filing Requirements and Actions for Dissolving LLCs and Corporations
While there are specific processes that companies must go through to receive a certificate of dissolution from the state of Colorado, which officially end the existence of a Colorado business, it is important that financial debts get settled, bank accounts are closed, outstanding tax obligations (such as sales taxes, business taxes, and state taxes) are paid, and all payroll obligations are fulfilled.
Companies going through a voluntary dissolution must be in good standing with the Colorado Secretary of State and need to adhere to all state laws surrounding the dissolution process.
Once a Colorado company has been dissolved, and its Articles of Incorporation or Articles of Organization are no longer valid, you should make the Internal Revenue Service aware that the Colorado business has been dissolved.
This notification to the IRS should be in the form of a letter that includes the Business Name, its Federal Tax ID Number (EIN or FEIN), the business address, and the reason for the dissolution.
The Colorado company will need to file a final tax return after you have filed for dissolution (both a federal tax return and state tax return) with the IRS and the Colorado Secretary of State.
Why Do I Need to Dissolve My Colorado Company?
If you are going to be ending your business, you may wonder why go forward with paying the filing fees and submitting paperwork to dissolve the company? Doesn’t the business just stop once you decide to stop?
Not necessarily – failing to dissolve a company properly can lead to penalties, potential lawsuits, and other fees until the company is formally dissolved with the Colorado Secretary of State. It is more cost-effective to pay to dissolve your Colorado company the right way than it is to face penalties, unknown taxes, and late fees.
Not only this, but your business will become officially terminated once the dissolution process is complete, failure to dissolve your business before leaving it will likely result in heavy fines and penalties.
The simplest way and the most stress-fee way to dissolve a business in Colorado is to utilize and take full advantage of the services of a professional Business Filing Services Company that will do it all for you. This will eliminate unnecessary administrative costs and potential liability and will ensure it is done correctly and according to Colorado law.