Dissolving a Virginia LLC
Dissolving a Virginia LLC is a process that includes resolving any outstanding business debts or legal obligations, filing articles of dissolution with the the Virginia State Corporation Commission (SCC), and notifying the appropriate taxing and licensing authorities that you have closed your company.
If you do not officially dissolve an LLC with the Commonwealth of Virginia, your company remains active—and liable—in the eyes of the state and business creditors. Below we’ll walk you through what to file, how to file, and other details regarding officially dissolving an LLC in Virginia, including why doing so can help you avoid costly consequences.
How to Dissolve an LLC in Virginia
To dissolve an LLC in Virginia, you’ll need to file articles of cancellation (also commonly known as “articles of dissolution”) with the Virginia SCC. There are two different forms depending on whether you are dissolving a domestic LLC or a foreign LLC in Virginia:
- To dissolve a domestic Virginia LLC you must fill out articles of cancellation of a Virginia LLC (Form LLC-1050).
- To dissolve an out-of-state/foreign LLC you must fill out the application for a certificate to cancel a Foreign LLC in Virginia (Form LLC-1056).
Both forms require basic information, including the LLC’s name, Virginia SCC ID number, formation date, a mail address for future correspondence regarding the the dissolution filing, and a signature from a person with the right and power to manage the company’s business affairs (e.g., members or managers). When dissolving a foreign LLC in Virginia, you will also need to indicate the name of the state or other jurisdiction under whose laws the LLC was formed.
How do I wind up business affairs in Virginia?
You will need to “wind up business affairs” before the state can officially process articles of dissolution (referred to as articles of cancellation or articles of withdrawal on some forms) for your Virginia LLC. Here are some of the more common business affairs and legal obligations you’ll need to address before wrapping up business in Virginia:
- Make sure your company is in good standing with Virginia state authorities. Pay off any past due payments and address any other pending matters. Otherwise, the state will not process your filing until you get back in good standing. You can check on your LLC online through the SCC Clerk’s office.
- Inform the Virginia Department of Taxation that you have shut down business or left the state of Virginia. You can do so by filing Form R-3 or accessing your online Virginia business iFile account.
- Notify any state and local licensing agencies that you may have a license through (Board for Contractors, Board for Realtors, Bureau of Insurance, and so on) that your business is dissolving and no longer transacting business in Virginia. Each county or city has their own processes, too, so call your local government center to review any other requirements for turning in your business license.
- Inform the IRS that you are actually shutting down your company entirely. Check with your tax advisor on the process specific to your type of company but typically this can be done by “checking the box” on your tax return form. And the IRS has a helpful page on properly and officially closing your business.
Where do I submit Virginia articles of cancellation?
You can submit your LLC’s Virginia articles of cancellation online, by mail, or by hand:
Online: SCC Clerk’s Information System
By Mail: Virginia State Corporation Commission Clerk’s Office P.O. Box 1197 Richmond, VA 23218
By Hand: Virginia State Corporation Commission 1300 E. Main Street, 1st floor Richmond, VA 23219
Is there a fee for filing articles of cancellation for a Virginia LLC?
There is a required $25 fee for filing articles of cancellation for a Virginia LLC. For mail or courier delivery, you can include a check payable to the Virginia State Corporation Commission. Online filings can be paid with a credit card or eCheck. The Virginia SCC asks business owners not to send cash.
Note: Don’t forget to factor in the cost of filing your final tax return with the IRS and the Virginia Department of Taxation.
How long does it take to dissolve an LLC in Virginia?
The Virginia SCC typically takes 1-2 weeks to process the request to dissolve an LLC in Virginia. You can file the articles of cancellation online today. Keep in mind, though, that you are required to “wind up business affairs” as part of filling out your articles of cancellation.
So, the sooner you can resolve any outstanding debts or obligations, the sooner you can dissolve your Virginia business. Typically, larger companies will take longer simply because they have more debts and obligations.
Why Dissolve a Virginia LLC?
If you don’t officially dissolve your Virginia LLC, your company is still responsible for state fees and taxes—not to mention taking on further debt. But why choose to dissolve your LLC at all?
- Relocation. Maybe you have a new business venture in a different state. Perhaps Virginia laws have become unfavorable for your industry. If the Virginia business environment is no longer right for you, then dissolving your Virginia LLC and moving on might be your best bet.
- Declining profits. If your business is beginning to see a loss in profits, you might consider dissolving your LLC. This is typically the case when management decides revenue is simply not high enough to justify continuing the business.
Those are just a couple of common reasons—every business has its own unique circumstances to consider. It’s a good idea to consult your LLC’s operating agreement for any directives on how to dissolve. Whatever your reason for no longer doing business in Virginia, officially closing out your Virginia company allows you to move on to your next venture fresh. And if you ever do decide to transact business in Virginia again, you won’t be hit with a slew of annual fees and penalties.