Not every limited liability company (LLC) lasts forever. In fact, many LLCs in Indiana are only intended to operate for a designated time period. Whatever your reasoning for closing up shop, the state of Indiana has a specific process that all LLCs must go through before they are considered to be officially dissolved.
Which steps are involved in the Indiana LLC dissolution process? Are there different processes for businesses based in Indiana and those expanded from other states? When do you need to dissolve your LLC? We’ll answer all of these questions and more in this article.
How Do You Dissolve an Indiana LLC?
When closing a business registered as an LLC in the state of Indiana, you’ll need to take care to dissolve your business exactly as the state outlines. The most important part of this process is filing the correct paperwork with the relevant legal entities, but this is far from the only vital step.
In addition to filing documentation of your Indiana LLC dissolution, you will need to liquidate the assets of your business, notify all individuals and business entities that have an interest in your company, and resolve any outstanding liabilities with vendors, suppliers, or clients.
There are potentially severe penalties for failing to comply with the Indiana LLC dissolution process, and you as a business owner could be personally responsible for your LLC’s liabilities and debts. Therefore, it’s extremely important that you complete each step outlined in this guide to ensure an effective and compliant dissolution.
As for the question of when you should dissolve your LLC, you should do this as soon as you’re certain you will no longer conduct business through this entity. This gives you an opportunity to close up shop with the knowledge that you’re not transacting any business after you start the dissolution process.
Dissolution for Domestic Indiana LLCs
Is your LLC based in Indiana, and registered as a domestic entity in this state? If so, you’ll start your dissolution process with a document known as the Articles of Dissolution of a Limited Liability Company, which can be filed online or using a paper form. This form will include some crucial information about your business, so you should fill it out carefully and accurately.
Among the info you’ll need to complete this form is the official business name of your LLC, the date you registered your LLC, the effective date of your dissolution, your LLC’s business address, your title, printed name, signature, and the date. You should also fill out a cover page with your name, address, and email address.
Once you’ve filled out the form, you’ll need to submit it to the Secretary of State, along with your $30 filing fee. Depending on how you submit your Articles of Dissolution, the state has varying turnaround times.
A mailed document will take 3-5 business days to process, starting from the day the state receives it. Online filings are typically processed within just 15 minutes during business hours, or by the next business day if you submit your documents after hours. If you submit your documents via express mail before noon, or if you deliver them in person before noon, your dissolution will be processed by noon the following day, while express mail and walk-in orders received after noon will be processed within two business days. No expedited services are available.
But what does this process look like for a business that was formed outside the state and then expanded to Indiana?
Dissolution for Foreign LLCs in Indiana
If you operate a foreign LLC in the state of Indiana, the dissolution process looks slightly different than it does for domestic entities. In fact, it’s actually technically called a withdrawal rather than a dissolution. Interestingly, this process has nothing to do with the Office of the Judge of Probate. Instead, you’ll deal directly with the Secretary of State, cutting out your local county’s middleman.
To dissolve a foreign LLC in this state, you’ll first complete the Statement of Withdrawal of a Foreign Entity document, which can be filed online or on a paper form. Much of the information for this form is the same as the info provided for the Articles of Dissolution, but there are some differences for the foreign version.
This form requires your business name, the jurisdiction your LLC was originally registered in, the reason for your withdrawal, the date your LLC was registered as a foreign entity in Indiana, contact information for potential future service of process deliveries, your name, title, signature, and date. Also, if you’re converting your LLC to a different entity type, you need to indicate what entity it will become (corporation, nonprofit, etc.).
The Statement of Withdrawal has the same $30 filing fee that applies to the Articles of Dissolution, and the turnaround times are the same as well.
Involuntary Dissolutions in Indiana
We should also discuss the potential for an LLC to be involuntarily dissolved by the state. There are several reasons this could happen, and most of them revolve around significant mistakes made by the LLC’s ownership group.
For instance, Indiana could involuntarily dissolve your LLC if you fail to file your biennial report within 60 days of the due date, operate your business without a registered agent for 60 or more days, or change your registered agent without informing the state.
It’s obviously never advisable to operate your LLC in a way that leads to the state dissolving it against your will. However, the penalties in Indiana aren’t as steep as they are in many other states. If the state dissolves your LLC administratively, you can get it reinstated for just $30, along with any late fees that may apply for your biennial reports or other required filings.
In addition, if you keep operating your business after the state involuntarily dissolves it, you could open yourself up to all sorts of legal issues due to the continued operation of a non-compliant entity. In general, you should be as careful as possible when it comes to following the rules and regulations in this state.
It’s not that the process for dissolving or withdrawing your LLC in Indiana is terribly difficult. However, it is a process that you need to take great care to complete in a compliant fashion, or you could expose your business to a wide variety of potential legal complications and financial penalties. Trust us when we say it’s much smarter and easier to simply follow the directions with care to avoid any issues.
Do you need more information about operating an LLC in Indiana? Take a look at the following resources: