Make sure you follow all the proper procedures if you plan on dissolving your company in Texas. You’ll need to take a few steps to wind down your company properly and avoid any legal trouble. We’ll guide you through the steps of closing a company in Texas in this article. We’ll discuss the various steps you’ll need to take, as well as the important deadlines you’ll need to be aware of. We’ll also give you some advice on how to make the procedure go as smoothly as possible.
How to Close a Business in Texas?The procedure will be different depending on the type of business you run. You must submit a single-member LLC certificate if you own a single-member LLC. For a two-member LLC, you’ll need to file a two-member LLC certificate. To legally dissolve your Texas limited liability company, you’ll need to file articles of dissolution with the Texas Secretary of State. You must submit a certificate of dissolution if you operate a limited liability business. An LLC dissolution must be done using this form. Nonprofit organizations are not required to submit a Certificate of Account Status with the Texas Comptroller, but they must file Form 651 to dissolve. Businesses in Texas can initiate the dissolution process by following the steps outlined in the Texas Business Organizations Code. To legally dissolve your company in Texas, you may need to provide written consent from all company shareholders to the Texas Secretary of State. There are many processes involved in a voluntary closing of a business in Texas. To complete this procedure, you will require extensive background knowledge of your Texas company. For this reason, it’s crucial to always maintain copies of relevant company records on hand.
3 Steps to Close a Business in TexasYou can follow these steps to close a business in texas.
1. Internal Business Activities Should Be DisbandedThe first step is to wind up the affairs of your business. This includes the following things:
i) Distribute Any Remaining Assets Among ShareholdersIf you don’t have any outstanding shares of stock in your business, you’re required to distribute any company assets to all shareholders. You’ll want to file a Certificate of Distribution with the Texas Secretary of State to ensure that all shareholders are informed. Once all shareholders have been notified of the distribution, you’ll need to distribute any remaining funds to the shareholders.
ii) Revocate Any Licenses, Permits, and Contracts Related to Your BusinessIf you have any permits or licenses associated with your Texas business, then you’ll need to cancel them. If you managed your business in-house, this might be an easy task, but if you outsourced these services, you’ll need to find out who your service provider is and contact them directly to cancel. You’ll likely have to purchase new permits and licenses for your business if required for the new operation.
iii) Inform Your Clients and Employees That You Will Soon Be Closing the CompanyAfter the final tax payment, you’ll finalize the termination of your Texas business by informing your employees and clients of the termination. You may be able to get a continuance of existing services until your employees and clients have had a chance to make alternate arrangements.
iv) Give Notice to Your Creditors That You are Going to Close a BusinessOnce you’ve decided to wind up the company, you’ll need to notify creditors. This includes any external parties loaned money to the business, such as landlords or other business partners. These creditors will need time to prepare for the termination of your company’s business. Creditors often won’t be able to do much after a notice is given. For example, a landlord might be unable to collect rent from your company’s office space after you’ve notified them that you’re winding up. This is because the company will be officially out of business before any money is paid.
2. Finish Filing Your Final Tax Return to Texas and the Federal Government (IRS)If you’re a sole proprietor, you’ll need to file final tax returns with the Texas Department of Taxation and the IRS. This is mandatory for sole proprietorships, so you’ll need to file the required forms with the state and federal governments. The deadline for filing these forms is 30 days after the end of your business tax year. Remember that you’ll need to manually point your returns and schedule your final payments with the IRS. The proprietors of the Texas LLC must additionally get a tax clearance in the form of a Certificate of Account Status from the Texas Secretary of State.
3. File Articles of DissolutionAfter you have fulfilled the necessary steps to officially dissolve your business in Texas, you must now file Articles of Dissolution with the Secretary of State’s Office. The Secretary of State will maintain a list of those LLCs that have filed articles of dissolution. After the articles have been filed, you will receive a Certificate of Dissolution.
Here’s the Easiest Way to Close Your Business in Texas Without Any HeadacheInstead of investing time and money attempting to dissolve your business on your own or hiring a law firm or attorney, just contact the GoodBye Startup experts and let them handle all of the required paperwork and filings with the right state and national authorities. Goodbye Startup Experts can help you save time and money, and avoid legal issues.
ConclusionNow that you know how to close a business in Texas, the next step is to get started. However, it’s important to remember that you’ll need to meet all the required deadlines. When it comes to winding down your company, you’ll want to make sure you get everything done as soon as possible.
How to Close a Business in Texas: Frequently Asked Questions
What are the costs of closing a company in Texas?Closing a Texas business might have varying costs. The filing fee amounts are subject to change. For the most up-to-date filing fees, see the Secretary of State’s fee schedule. Your company will be formally dissolved after the filing fee and your Certificate of Termination have been processed by the Texas Secretary of State.
When closing a business in Texas, how long does it take?The processing period for termination certificates varies, however in most situations it is 3-5 days. The Texas Comptroller’s office is where the heavy work is done. It takes 4-6 weeks to complete and get your tax clearance after submitting form 05-359, Request for Certificate of Account Status.
What is a Texas franchise tax return?To conduct business in Texas or to have your business founded or structured in Texas requires paying a privilege tax known as the Texas franchise tax.
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