Is it time to close your Louisiana corporation, but you’re not sure where to start the process?
Dissolving a corporation is a lengthy but manageable endeavor. And every state’s procedure looks a bit different. In this guide, we’ll cover the state-specific components of dissolving your Louisiana corporation. In no time, you’ll be on your way to whatever’s next.
The Basics of Dissolving a Louisiana Corporation
In general, every dissolution follows the same basic structure, with 5 basic steps. There are, of course, a lot more “nuts and bolts” to the process (read more about them here), but for now, let’s get a bird’s eye view:
- Vote to dissolve the corporation: Corporations are not solo endeavors, and ending them isn’t one individual’s call. First, your board will need to convene and vote on a motion to dissolve the corporation. After that, some corporations will need to have their shareholders vote for the dissolution as well (depending on the corporation’s bylaws).
- File the dissolution paperwork: Once your corporation’s members have decided to dissolve, you’ll reach out to the Louisiana Secretary of State and fill out the appropriate Affidavit to Dissolve.
- Fulfill your tax obligations: Your corporation will need to pay any taxes due to the IRS and the Louisiana Department of Revenue. This can be a multi-step process as you liquidate assets and pay any creditors.
- Cancel licenses and close accounts: If your corporation maintains any licenses or permits, this is the time to cancel them so you aren’t charged renewal fees. You should also close down accounts with vendors and your bank (once your financial affairs are settled).
- Notify your stakeholders: A dissolving corporation must settle any financial debts, liquidate its assets, and distribute the appropriate funds to its shareholders. Stakeholders must be notified so they can lay claim to their share in a timely fashion.
That’s the gist of dissolving a Louisiana corporation. But before you can truly start the process, you’ll need to answer one important question.
Who’s Dissolving the Louisiana Corporation?
Two key groups can dissolve a corporation: the initial incorporators or the shareholders. The group initiating the dissolution affects how you file with the Secretary of State. So let’s talk about each.
Dissolving a Louisiana corporation by the incorporators or initial board of directors
In some cases, a Louisiana corporation might decide to really get things up and running. More specifically, if no shares of stock have been issued, then the incorporators (or initial directors with the incorporator’s approval) will be the ones who vote to dissolve the corporation.
Once the dissolution vote passes, the corporation can file the Affidavit to Dissolve Corporation form. Here’s the information required to complete this document:
- State of the corporation
- Parish of the corporation
- Corporate name
- Confirmation that the incorporators approved the dissolution
- Name and signature of each incorporator
- Signature of a notary public
- Name and number of that notary
There is a $75 filing fee for this document; once you file it, you’ll be sent a Certificate of Dissolution from the Secretary of State. After you complete and file the Certificate, your corporation will be officially dissolved. Note: Louisiana usually processes most paper filings within 5-7 business days.
Dissolving a Louisiana corporation by the shareholders
In a corporation that has issued shares, the dissolution process looks a bit different. In most cases, the board votes for a motion to dissolve the corporation. Then that vote is brought before the shareholders for final approval.
Once that approval is obtained, it’s time to file the Affidavit to Dissolve Corporation. This is the same form as above. You’ll fill out a lot of the same information, but instead of confirming that the incorporators made the decision, you’ll have the shareholders do so and sign the form. The filing fee is still $75, and your form should be processed within 5-7 business days.
All told, the paperwork steps for dissolving a corporation are pretty similar; it’s primarily a matter of filing the proper form.
What About Administrative Dissolutions?
Sometimes, the state of Louisiana may force a corporation to dissolve against its will. Usually, this happens because a corporation hasn’t filed its annual report, paid its taxes, maintained its registered agent, renewed appropriate licensure, or some other clerical error. A corporation may also be dissolved for any activities that are ruled fraudulent or otherwise harmful to the public.
In most cases, these corporations can be restored and resume business. The process can be quite a hassle, but it is manageable. First, a corporation must resolve whatever issue caused its dissolution. A corporation with defunct annual reports, for example, would need to submit the reports and pay any missing fees (plus late fees).
Louisiana makes it pretty simple to get reinstated; all you really have to do is file all of your delinquent reports. Once they’re filed, you can file the Articles of Reinstatement for $75 plus a $30 penalty for each delinquent report. You have up to 5 years to complete this process.
Note: this 5-year reinstatement window is for administrative dissolutions only. Voluntary dissolutions (as discussed above) have a smaller window of opportunity to get reinstated.
It’s far easier to avoid dissolution entirely; remain compliant with your corporation, and you can skip this step completely.
Frequently Asked Questions
What happens to my Louisiana business name?
After you dissolve your corporation, your business name becomes immediately available for other businesses to use if they wish. Because of that, we highly recommend making sure you’re absolutely confident that you’re done conducting business before filing dissolution paperwork.
Can I change my mind and go back into business?
Yes, but you can’t dawdle. If you voluntarily dissolved your corporation, you have just 120 days to go back into business. To do that, you’ll need approval from whichever group originally approved the dissolution. Then you can file the Articles of Reinstatement form. There’s a $75 fee for this filing. Find the full state guidelines for this process here.
What if I want to become an LLC instead of closing my business?
Louisiana is one of a few states that doesn’t have a statutory provision for an easy conversion from a corporation into an LLC. Corporations can automatically convert into an unincorporated entity type instead. If you want to be an LLC, you’ll have to dissolve your corporation and then reform as an LLC. For more information on Louisiana LLCs, check out our guide to starting and running a Louisiana LLC.
Do I have to publish a notice that my corporation is dissolving?
You must notify your stakeholders that your corporation is dissolving, but Louisiana doesn’t require you to use a newspaper notification. That said, a newspaper notice is helpful for disposing of any unknown claims. You can read more about this process here.
How can I avoid being dissolved because of a registered agent issue?
In Louisiana, you can be administratively dissolved if you let your registered agent coverage lapse. Thankfully, you can avoid this problem easily. If you’ve picked a new agent or your old agent has resigned, simply file the Notice of Change of Registered Office and/or Change of Registered Agent form as soon as possible. There’s a $25 fee.
As long as you avoid a lapse in your agent coverage, your corporation will stay compliant.
How long do Louisiana stakeholders have to lay claim to my corporation’s assets?
When you notify your stakeholders that your corporation is dissolving, you actually get to set out the timetable they have to come forward and make a claim. That said, the state does have a minimum statutory requirement of 120 days. You can provide for more time than that if you wish, but you must give them 120 days. There’s a different procedure for unknown claims, which you can learn more about in the state’s Dissolution Articles.
Dissolve a Corporation in all States
We break down the corporation dissolution process in every state. View all of our guides below.
- Dissolve an Alabama Corporation
- Dissolve an Alaska Corporation
- Dissolve an Arizona Corporation
- Dissolve an Arkansas Corporation
- Dissolve a California Corporation
- Dissolve a Colorado Corporation
- Dissolve a Connecticut Corporation
- Dissolve a Delaware Corporation
- Dissolve a Florida Corporation
- Dissolve a Georgia Corporation
- Dissolve a Hawaii Corporation
- Dissolve an Idaho Corporation
- Dissolve an Illinois Corporation
- Dissolve an Indiana Corporation
- Dissolve an Iowa Corporation
- Dissolve a Kansas Corporation
- Dissolve a Kentucky Corporation
- Dissolve a Maine Corporation
- Dissolve a Maryland Corporation
- Dissolve a Massachusetts Corporation
- Dissolve a Michigan Corporation
- Dissolve a Minnesota Corporation
- Dissolve a Mississippi Corporation
- Dissolve a Missouri Corporation
- Dissolve a Montana Corporation
- Dissolve a Nebraska Corporation
- Dissolve a Nevada Corporation
- Dissolve a New Hampshire Corporation
- Dissolve a New Jersey Corporation
- Dissolve a New Mexico Corporation
- Dissolve a New York Corporation
- Dissolve a North Carolina Corporation
- Dissolve a North Dakota Corporation
- Dissolve an Ohio Corporation
- Dissolve an Oklahoma Corporation
- Dissolve an Oregon Corporation
- Dissolve a Pennsylvania Corporation
- Dissolve a Rhode Island Corporation
- Dissolve a South Carolina Corporation
- Dissolve a South Dakota Corporation
- Dissolve a Tennessee Corporation
- Dissolve a Texas Corporation
- Dissolve a Utah Corporation
- Dissolve a Vermont Corporation
- Dissolve a Virginia Corporation
- Dissolve a Washington Corporation
- Dissolve a Washington D.C. Corporation
- Dissolve a West Virginia Corporation
- Dissolve a Wisconsin Corporation
- Dissolve a Wyoming Corporation