Not every limited liability company (LLC) lasts forever. In fact, many LLCs in Mississippi are only intended to operate for a designated time period. Whatever your reasoning for closing up shop, the state of Mississippi has a specific process that all LLCs must go through before they are considered to be officially dissolved.
Which steps are involved in the Mississippi LLC dissolution process? Are there different processes for businesses based in Mississippi 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 a Mississippi LLC?
When closing a business registered as an LLC in the state of Mississippi, 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 Mississippi 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 Mississippi 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 Mississippi LLCs
Is your LLC based in Mississippi, and registered as a domestic entity in this state? If so, you’ll start your dissolution process with a document known as the Certificate of Dissolution, which can only be filled out and filed online. 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 reason for your dissolution, the effective date of your LLC’s dissolution, contact information for potential future service of process deliveries, and the name, title, and signature of your authorized person.
Once you’re done filling out the form, you’ll submit it to the Secretary of State along with your $50 filing fee. As for your turnaround times, you can expect them to process your dissolution the same day you file it, often within just a few minutes.
But what does this process look like for a business that was formed outside the state and then expanded to Mississippi?
Dissolution for Foreign LLCs in Mississippi
If you operate a foreign LLC in the state of Mississippi, 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.
To dissolve a foreign LLC in this state, you’ll first complete the Certificate of Withdrawal document. Much of the information for this form is the same as the info provided for the Certificate of Dissolution, but there are some differences for the foreign version.
This form requires your business information (name, address, etc.), your business email address, the effective date of your LLC’s withdrawal from Mississippi, a mailing address for potential future service of process deliveries, and your signature, title, name, and address.
Once you’re ready to file this form, you can pay the $25 filing fee to the Secretary of State. Just like with the Certificate of Dissolution, this filing is typically processed the same day you submit it, often within just a few minutes.
Involuntary Dissolutions in Mississippi
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, Mississippi could involuntarily dissolve your LLC if you fail to pay any relevant fees within 60 days of their due dates, fail to file an annual report within 60 days of the deadline, operate your LLC without a registered agent for 60 days or more, fail to inform the state of a change to your registered agent within 60 days, fail to fulfill your tax obligations with the Department of Revenue, or misrepresent your LLC in any records submitted to the Secretary of 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 can be even steeper than you might realize. To get your LLC reinstated, you’ll need to file a reinstatement request with the Secretary of State, catch up on any delinquent fees, taxes, and/or annual reports, and pay a filing fee ($100 for a foreign LLC or $50 for a domestic LLC).
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 Mississippi 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 Mississippi? Take a look at the following resources: