Closing a business in California is a multi-state, multi-step process that requires filing the appropriate dissolution, service, or cancellation forms with the Secretary of State (SOS) within 12 months of filing the final tax return. To dissolve a California corporation, submit the necessary forms to the SOS by mail or in person. The forms can be completed online and then printed, and must be written on or in black or blue ink. Checks must be made payable to the Secretary of State, and if submitting documents in person, include separate payment of the additional fee.
Additionally, a certificate of dissolution must be submitted before or together with the certificate of cancellation. The California Franchise Tax Board (CFTB) also requires all tax balances to be paid and last year's tax return to be filed when liquidating the business. If filing an Information Statement on the SOS website, you will be notified of any specific charges owed to your business entity. It is important to note that as soon as a California corporation dissolves, another entity can apply for the same business name.
LLCs that are classified as a corporation or entity not considered and doing business in California must file Form 568 annually. Closing a business in California is not as simple as closing your office doors and putting up a closed sign, or removing your company's website and leaving. To ensure that all necessary steps are taken to properly close your business, it is important to understand the requirements for dissolution, surrendering, or canceling your California business entity. To begin the process of closing your business in California, you must first file the appropriate dissolution, service, or cancellation forms with the SOS within 12 months of filing the final tax return.
The CFTB also requires all tax balances to be paid and last year's tax return to be filed when liquidating the business. Once all necessary documents have been filed with both the CFTB and SOS, you will receive confirmation that your business has been dissolved or canceled. It is important to keep this confirmation for your records as proof that you have properly closed your business in California. To ensure that all necessary steps are taken to properly close your business, it is important to understand the requirements for dissolution, surrendering, or canceling your California business entity.
