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New York Corporation Dissolving? Here's What You Need To Know
Author: Dan Brecher
Date: February 13, 2014
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As they say, all good things must come to an end. Whether you plan to retire, start a new venture, or simply sell your business, it is imperative to give your New York corporation a proper farewell.
Through the process of voluntary dissolution, the corporation ceases to exist, as does the obligation to pay future taxes and fees to New York State. The official corporate transaction also protects your New York Corporation from future liability by putting creditors on notice that the corporation can no longer incur business debts.
Given the significance, it is imperative to take the right steps to properly dissolve the company. Under New York law, voluntary dissolution is a multi-step process, involving both the Department of Taxation and Finance and the Department of State.
Below is a brief summary of the requirements:
Formally agree to close the business: The first step to dissolving the corporation is to conduct a shareholder vote or other procedure outlined in your articles of incorporation or corporate by-laws. The process should be recorded in writing, such as a formal resolution.
Obtain consent from the Department of Taxation and Finance: You will next need to prepare a final tax return and file it with the state. If the corporation is current with its returns and taxes, the Tax Department will issue a written consent to dissolve the corporation. If there are any outstanding issues, you will receive a letter outlining the required steps you must take to resolve them.
Create and file a Certificate of Dissolution with the Department of State: The next step is to complete a Certificate of Dissolution. The Department of State provides the proper form on its website. You will need to provide the official name of the corporation, the date of incorporation, the name and address of each officer/director, and the manner in which the dissolution was authorized, You will also need to attach a copy of Consent of the New York State Department of Taxation and Finance. The fee for filing the Certificate of Dissolution is $60, and the paperwork may be delivered via mail, fax, or in person.
Terminate any out-of-state registrations: If your corporation was qualified to do business outside of New York, you will also need to file the appropriate paperwork in those jurisdictions. If you fail to do so, you may continue to incur taxes and other fees. Most states provide the necessary forms on their websites, under the names application of withdrawal, certificate of termination of existence, termination of registration, or certificate of surrender of right to transact business.
Because corporate dissolution can be paperwork intensive and time-consuming, many corporations seek the assistance of outside professionals, such as accountants and business attorneys, who are familiar with the process. This helps ensure that all of the required steps are completed to officially dissolve the corporation and avoid any unforeseen future liability.
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New York Corporation Dissolving? Here's What You Need To Know
Author: Dan Brecher
As they say, all good things must come to an end. Whether you plan to retire, start a new venture, or simply sell your business, it is imperative to give your New York corporation a proper farewell.
Through the process of voluntary dissolution, the corporation ceases to exist, as does the obligation to pay future taxes and fees to New York State. The official corporate transaction also protects your New York Corporation from future liability by putting creditors on notice that the corporation can no longer incur business debts.
Given the significance, it is imperative to take the right steps to properly dissolve the company. Under New York law, voluntary dissolution is a multi-step process, involving both the Department of Taxation and Finance and the Department of State.
Below is a brief summary of the requirements:
Formally agree to close the business: The first step to dissolving the corporation is to conduct a shareholder vote or other procedure outlined in your articles of incorporation or corporate by-laws. The process should be recorded in writing, such as a formal resolution.
Obtain consent from the Department of Taxation and Finance: You will next need to prepare a final tax return and file it with the state. If the corporation is current with its returns and taxes, the Tax Department will issue a written consent to dissolve the corporation. If there are any outstanding issues, you will receive a letter outlining the required steps you must take to resolve them.
Create and file a Certificate of Dissolution with the Department of State: The next step is to complete a Certificate of Dissolution. The Department of State provides the proper form on its website. You will need to provide the official name of the corporation, the date of incorporation, the name and address of each officer/director, and the manner in which the dissolution was authorized, You will also need to attach a copy of Consent of the New York State Department of Taxation and Finance. The fee for filing the Certificate of Dissolution is $60, and the paperwork may be delivered via mail, fax, or in person.
Terminate any out-of-state registrations: If your corporation was qualified to do business outside of New York, you will also need to file the appropriate paperwork in those jurisdictions. If you fail to do so, you may continue to incur taxes and other fees. Most states provide the necessary forms on their websites, under the names application of withdrawal, certificate of termination of existence, termination of registration, or certificate of surrender of right to transact business.
Because corporate dissolution can be paperwork intensive and time-consuming, many corporations seek the assistance of outside professionals, such as accountants and business attorneys, who are familiar with the process. This helps ensure that all of the required steps are completed to officially dissolve the corporation and avoid any unforeseen future liability.