Have you decided to stop transacting business with your Vermont limited liability company? The state of Vermont 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 Vermont.
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 Vermont 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 Vermont.
How to Dissolve a Domestic Vermont LLC
If your limited liability company is domestic to the state of Vermont, the dissolution process involves the filing of a document called the Articles of Termination. Vermont strongly encourages you to use the online filing system for this document. However, if you’d rather file by mail, you can print the form at the end of the process. The information required to fill out this document often includes:
- Name of your LLC
- Effective date of the dissolution
- Affirmation that your LLC no longer conducts business
- Address where process may be served on the LLC
- eSignature of authorized representative
Once you’ve finished filling out this form, you need to pay the $20 filing fee. If you file online, you can pay by credit card. There is no extra fee for online processing. Mailed-in filings will require a check made out to the Secretary of State. You’ll send both the form and payment to the following address:
Vermont Secretary of State
Corporations Division
128 State Street
Montpelier, Vermont 05633-1104
Typically, the Vermont Secretary of State’s office takes up to 3-5 days to process your dissolution documents if you file online. Mail-order filings usually require 7-10 days. Please note that during the Secretary of State’s peak times (January to April), these filing times can be longer.
How to Dissolve a Foreign LLC in Vermont
Do you need to dissolve a limited liability company based outside of Vermont, but qualified to transact business within this state?
The dissolution process for foreign LLCs in Vermont starts with the filing of a Certificate of Cancellation. Like the Articles of Termination used for domestic LLCs, the Certificate of Cancellation is easiest to file online. If you’d rather file by mail, you can print off the form near the end of the process. This form often includes the following information:
- Name of your LLC
- State or country of formation
- Street address where process may be served to the LLC
- Effective date of cancellation
- Affirmation that your LLC no longer conducts business in Vermont
- eSignature of authorized representative
Similar to the Articles of Termination, the Certificate of Cancellation requires a $20 filing fee. You can pay by card or check. If mailing in your form, you can use the same address:
Vermont Secretary of State
Corporations Division
128 State Street
Montpelier, Vermont 05633-1104
Online filings usually take 3-5 business days to be processed, while mail-order forms take approximately 7-10 days.
What Else Do I Need to Know About LLC Dissolutions in Vermont?
First off, it’s important to note that once you file your dissolution documents, any business entity in Vermont 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 Vermont 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 Vermont administratively dissolving your LLC. If you fail to file your annual report on time, your LLC will immediately lose its good standing with the state, and if you don’t file your report within two and a half months of your due date, the Secretary of State will perform an administrative dissolution of your business. The same applies if your LLC goes 90 consecutive days without any members.
If your LLC is administratively dissolved, your business name is protected for up to five years. This time period gives you a chance to reinstate your LLC. Doing so can be a hassle, though. You will need to pay a $25 reinstatement fee plus all the annual report fees you missed. 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 Vermont again.
Conclusion
Whether you’re dissolving a domestic or foreign limited liability company, the process isn’t complicated.
The filing of either the Certificate of Cancellation or the Articles of Termination 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 Vermont LLC!