How to Dissolve an LLC in Kentucky | LLC Closing Guide

To dissolve a limited liability company one has to take up a set of required steps. In Kentucky, if you and the members of the LLC want to discontinue business, then it is necessary to dissolve their business legally to avoid any administrative and legal consequences. To dissolve an LLC in Kentucky, you are required to submit a complete Article of Dissolution to the Secretary of State. Before submitting the Article of Dissolution, one must follow the operating agreement.

If you have a Kentucky LLC (domestic or foreign) you must have an operating agreement. The first step towards the dissolution of Kentucky LLC is to follow the operating agreement. There are some points to be noted before proceeding with the official paperwork. At first, make sure all the members of the LLC are agreed to dissolve the business. Once all the members are ready, their consent should be recorded via voting. After casting their vote in favor of the dissolution, the legal process must be started. Here are the steps to address for dissolving Kentucky LLC.

How to Dissolve an LLC in Kentucky

Dissolution of Kentucky LLC requires three broad procedural steps. Having a Kentucky LLC Operating agreement, close all the tax accounts, and finally submit the Articles of Dissolution form to the Kentucky Secretary of State.

Step 1: Follow Your Kentucky LLC Operating Agreement

When you have started an LLC as a business entity, then there is an operating agreement that is formed. There are complete details of how the company will function and grow in that operating agreement, which acts as a comprehensive guide. There is also a dissolution process, which is added to your agreement. The common dissolution steps that almost every LLC follows are:-

First of all, the dissolution vote will take place among the LLC members in the dissolution meeting. If the majority is with the YES, then the process goes into legal proceedings.

• All the dissolution votes will be noted down and recorded with the minutes of the meeting or a consent form.
• After that, a formal date for dissolving the LLC will be decided.
• The next step is counting the LLC assets and dividing them among the stakeholders and members accordingly.
• Finally, the creditors of the business are notified, and the debts of the business are settled.

This is a general process. However, it is strongly recommended to seek professional help to avoid any complications when it comes to terminating an LLC.

Get a Professional Agent Service

When it comes to a limited liability company dissolution, it is important to get professional help. The Kentucky registered agent will guide you with everything you need to close your limited liability company. While choosing a registered agent make sure they have a physical street address in the state. A professional service provider helps you to file the Article of Dissolution and close your various tax accounts without any hassle. Below are the best LLC services we strongly recommend for you.

Step 2: Close All Tax Accounts

Every action that an official business takes is legally bound to some minimum business taxes. For that, various accounts, especially business entity tax account, are maintained by the state government with the help of various departments. You should consider all the taxes that you have paid for your LLC’s duration and make a list of them.

You must contact all government entities and clear the amount of outstanding taxes due until the date you have decided for dissolution. All the taxes must be paid in advance so that you don’t face any issues in the further process of shutting down your LLC.

Some of the common taxes that limited liability companies have to pay are:

• Unemployment insurance tax
• Employee withholding tax if your LLC has employees.
• If your LLC is engaged in selling taxable goods then they are liable to pay the sales and use tax.

Most of these taxes are normally filed, but some departments require official paperwork, without which it is impossible for the business to close their accounts. Apart from business taxes, federal taxes, personal income taxes, and franchise taxes are to be considered. For the franchise taxes, a franchise tax form is required.

That is why the LLC owner should go through the sales tax guide and hire an accounting service. If you want to do the accounting yourself or make accounting easy, try FreshBooks.

Tax clearance

While dissolving the Kentucky LLC, the owner does not require to obtain a tax clearance certificate. However, if you have filed federal taxes, then you must go through the final return option on your IRS form.

The IRS form for the LLC that are classified as partnerships is form 1065, and those LLC’s who have registered themselves as corporate should check IRS form 1120.

Step 3: File Articles of Dissolution

There is a list of dissolution documents that you, as an LLC owner, have to file. Once these articles are filed, the legal existence of the LLC will be over. Like a Kentucky Articles of Organization, one has to file Kentucky LLC Articles of Dissolution. The dissolution procedure and filing the articles of dissolution form is very easy and is discussed below.

• First of all, the LLC owner(s) has to file the Article of Dissolution. There are multiple methods of filing available, such as file by mail, in-person drop, or/and online filing. To get the application form you need to visit the Secretary of State Website of Kentucky state.
• You can follow the filing instruction on the official portal so that the steps for dissolution will be easier to complete.
• In that particular SOS website, the LLC owner has to look for the Domestic LLC Articles of Dissolution page.
• If you want to dissolve Kentucky Foreign LLC then look for the Foreign LLC Dissolution process.
• There is a form available on this page, which is the article of dissolution you are looking for. You have to download that pdf form and start filling it.
• You must fill in all the important and legal information in the form, so you should be extra careful.
• After filling in all the important information, you must choose the mode of payment you want to use to pay the LLC dissolution filing fees.
• After filling in every detail, one should submit the form through an official mail address and make a payment.
• It takes 3-5 business days after filing of articles of dissolution if you are filing it by mail or in-person.

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The LLC you owned is dissolved, and you are free from all the liabilities linked with the LLC and its taxes. A copy of both original articles and recorded articles should be submitted in front of the probate judge. Now it’s his call that he accepts your expedited dissolutions or not.

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Points to Be Noted When Dissolving Kentucky LLC

Apart from these three steps, no major dissolution rules are there in Kentucky. However, there are some other tasks one has to keep in mind while dissolving an LLC legally.

Winding Up

There are some purposes of LLC that require some attention even after dissolution, known as winding up. The task of winding up includes.

• For a certain period, the property of a business requires preservation.
• If there is any civil case against the LLC, then the owner needs to finish them.
• Settle all the existing disputes of LLC.
• Transfer all the property of LLC to the names of partners.
• Release all the liabilities that the LLC owes to others.
• Rightful distribution of all the assets among members, according to their percentage of partnerships.

Cost of Dissolving LLC

LLC cost in Kentucky includes the formation as well as dissolution fees. To dissolve an LLC in Kentucky, LLCs have to file an Article of Dissolution. The filing fee is $40. The details are mentioned on the second page of the article dissolution filing form. Following are the ways to pay for the dissolution,

• You can select a payment pick-up option.
• There is an option of direct account transfer through your prepaid accounts.
• LLC owners can also use their Credit cards, providing their complete details and types. Along with that, an original signature is required to authorize the transaction state will make.

After Dissolving Your LLC

After you formally dissolve your LLC, your business name will not be reserved anymore. Any other business entity will be eligible to use your Kentucky LLC name immediately after 120 days of dissolving your LLC. On the other hand, if you have a foreign LLC in other states, then you must comply with the SOS of the state after the dissolution of your LLC in Kentucky. A registered agent can help you do the needful.

Reasons Behind Dissolving Kentucky LLC

After some disagreements in the company, the owners might need to dissolve an LLC in Kentucky. It is something that every company that is on the verge of shutting down has to go through. If they are not ready to do it legally, they might have to go through some consequences. Want to know those issues? Check the following points!

• The company can face the loss of income or equity from the business.
• It is possible that assets can be the reason for the loss.
• The debt can keep on accumulating in the name of the company’s owners.
• The complications can arise in the name of unpaid taxes.
• The owners can also be held accountable as personal liability for failing to act on an important decision.

Top Businesses in Kentucky!

Many people aspire to start an LLC in Kentucky. To be able to start their company, they need a lot of research on the facts. They have to check which industry is making a more positive impact on the economy and providing the best. That is surely so time-consuming, and that is why we are here to provide help! Here are some top industries and the amount they contribute to the GDP,

1. Manufacturing: It is an industry that makes the most in the state and is also the top one to contribute to the state. It is the one that gives out 18% to the GDP of the state also. People get better wages in the industry, and it is the leading sector for jobs for people in Kentucky. The pay increases every year, becoming the best sector of the state year by year.
2. Rental, leasing, and real estate industry: It is essential to have a place to live or work. So it is the reason why most people are looking for land or a place for rent. It is contributing $28.29 billion to the GDP and increasing the development of the state.
3. Agriculture: There are so many products that this sector provides to the state. It is bound to provide the products, but it is also a significant factor in the GDP. The sector generated around $5.9 billion and contributed approximately 6.4% to the GDP. The state cannot grow without this sector, and it is also an important one for the economy.

Kentucky LLC Dissolution Review

F.A.Qs

What is the Cost to Dissolve an LLC in Kentucky

To dissolve an LLC in Kentucky you need to file the Articles of Dissolution with the Kentucky Secretary of State via mail or in person for $40.

In the state of Kentucky, the process of dissolving an LLC comes with specific requirements and costs that business owners need to be aware of. The cost to dissolve an LLC in Kentucky can vary depending on several factors, including the complexity of the LLC structure, the number of members involved, and whether there are outstanding debts or obligations that need to be settled.

One of the primary costs associated with dissolving an LLC in Kentucky is the filing fee with the Secretary of State. Business owners will need to submit specific forms and pay a fee to officially dissolve the LLC. Additionally, there may be other fees associated with submitting the necessary paperwork, obtaining any required consents from members or creditors, and publishing notice of the dissolution in a local newspaper.

Another cost to consider when dissolving an LLC in Kentucky is the potential need for legal assistance. While it is possible to complete the dissolution process independently, seeking the guidance of a legal professional can ensure that all necessary steps are taken and that the process is completed correctly. Legal fees can vary depending on the complexity of the dissolution, but they should be factored into the overall cost of dissolving an LLC.

In addition to the financial costs of dissolving an LLC in Kentucky, business owners should also consider the time and effort required to complete the process. Dissolving an LLC involves various steps, such as notifying creditors, settling debts, filing paperwork, and ensuring compliance with state regulations. It is important for business owners to allocate the necessary time and resources to properly dissolve the LLC.

While the cost of dissolving an LLC in Kentucky may seem daunting, it is an important step for business owners to take when closing their business. Failing to properly dissolve an LLC can have legal and financial consequences, including potential liability for outstanding debts or obligations. By following the required steps and investing in the process of dissolution, business owners can protect themselves and their assets moving forward.

Overall, the cost to dissolve an LLC in Kentucky should be viewed as an investment in ensuring the proper closure of a business entity. By understanding the requirements, seeking professional guidance if necessary, and allocating the time and resources needed, business owners can navigate the dissolution process successfully. While the financial costs may vary, the peace of mind that comes from properly dissolving an LLC is invaluable in the long run.

In Conclusion

Limited liability companies reduce owners’ personal liability. Having an LLC is quite cost-effective. However, if it is required to close down the business, then the dissolution process should be done legally. Get a professional service to get everything done. We hope this article helps you to close your LLC in Kentucky. If you have any query do let us know in the comment box.