Have you decided to stop transacting business with your Colorado limited liability company? The state of Colorado legally requires all business entities to go through a formal dissolution process.
What does this process entail, and how does it differ for domestic and foreign entities? In this guide, we’ll answer all the tough questions about dissolving an LLC in the state of Colorado.
Guru Tip: If you'd like help dissolving an LLC, the same services that form an LLC can also take care of the dissolution logistics and paperwork with the state.
What Does It Mean to Dissolve an LLC?
Dissolving a company is an official means of permanently closing your business. While filing the dissolution documentation with the state of Colorado is certainly an important part of the process, it’s not the only step. You should also liquidate your business assets, settle any liabilities, and send legal notifications to anyone that had an interest in your company.
Keep in mind that if you fail to complete these steps, you as a business owner could be held personally liable for any outstanding debts or liabilities of your limited liability company. Now that we’ve discussed what exactly dissolving an LLC is, let’s dive into the details of how this process is carried out in the state of Colorado.
How to Dissolve a Domestic Colorado LLC
If your limited liability company is domestic to the state of Colorado, it is very easy to file the necessary forms online with the Secretary of State. You can access and fill out the Statement of Dissolution here. This form requires the following information:
- LLC state ID number
- Business name
- Business jurisdiction
- Principal office address
- Mailing address (if different from the principal office address)
- Additional attachments (if applicable)
- Payment information
Once you’ve finished filling out this form, you will need to pay a $25 processing fee. Since the Statement of Dissolution must be filed online, the form is processed immediately after you click “Submit.”
How to Dissolve a Foreign LLC in Colorado
Do you need to dissolve a limited liability company based outside of Colorado, but qualified to transact business within this state?
The dissolution process for foreign LLCs in Colorado starts with the filing of the Statement of Foreign Entity Withdrawal. This form must be filed online via the Secretary of State’s website. You must provide the following information:
- Entity name and ID number
- Name and address of the registered agent (if applicable)
- Principal office address
- State or country of formation
- Affirmation of dissolution requirements
- Effective date of dissolution
- Name and address of applicant
The Statement of Foreign Entity Withdrawal requires payment of a $10 filing fee. Just like the Statement of Dissolution, this form is processed immediately after you click “Submit.”
What Else Do I Need to Know About LLC Dissolutions in Colorado?
It is important to note that once your dissolution is complete, any business entity in Colorado can claim your business name if they would like to use it. This is just one of many reasons that you should only dissolve your Colorado limited liability company if you’re entirely certain that you’re done conducting business in this state.
You should also keep in mind that there are several scenarios that can lead to the state of Colorado administratively dissolving your LLC. This can happen if you fail to file a periodic report on time or fail to maintain a registered agent. In this scenario, the dissolved entity’s name remains unavailable for public use for a period of 400 days, but you can reinstate your business during this period by filing the Articles of Reinstatement. You can learn more about this process here.
In addition to administrative dissolution, your business can also be judicially dissolved in the state of Colorado. This happens when a court order is issued to initiate the dissolution process. In this case, the name is immediately available for public use, and there is no process for reinstatement.
Depending on the nature of your business, these steps could be just the tip of the iceberg for reinstatement, so it’s strongly advised to not dissolve your business unless you have no plans to transact business in Colorado again.
Conclusion
Whether you’re dissolving a domestic or foreign limited liability company, the process isn’t complicated.
The filing of either the Statement of Dissolution or the Statement of Foreign Entity Withdrawal is essentially the same process.
Our final note in this guide is that you should make certain each step of the process outlined in this guide is followed closely, to avoid any unforeseen snags with your dissolution. We hope this article helped you to better understand the dissolution process for a Colorado LLC!