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Ask a Lawyer -- LLCs
LLC Question 100
Question: I formed an LLC in early 2006. I planned to start the business going very quickly and be self-employed within 6 months. Unfortunate, I had many family issues throughout 2006. My grandmother passed away, my uncle passed away, my father became very ill and my mother had several surgeries. On top of all that I got laid off from my regular job and had a tough time finding a new job. My new job is my dream job, I love every aspect of it and have no desire to continue with my LLC. How do I go about dissolving the LLC. It did no business in 2006 and had no expenses either, so I would assume it would be quite easy.
Response: Unless I'm missing something, it looks relatively easy to dissolve an LLC in New Jersey as compared with other states. On the bottom of this page, I have reprinted some of the statutes from the NJ LLC Act relative to dissolution and canceling an LLC certificate of formation. The first step is to dissolve the LLC. That involves (a) execution of a resolution from the LLC members to dissolve the LLC, (b) liquidating all assets of the LLC, (c) paying all creditors of the LLC including taxing authorities, and (d) then distributing whatever cash remains to the members per the operating agreement. As you are the sole member and the business was never in operation, there should be no issues with steps (b) through (d). It appears the final step is to file a Certificate of Cancellation with the New Jersey Division of Revenue. You may want to contact the New Jersey Division of Revenue to see if I have left any steps out. Most states require a tax clearance letter from the state taxing authority showing that all taxes have been paid before they will finalize the dissolution of an LLC (or corporation) but I could not find such a requirement for NJ.
Submitted: 2-1-2007; Jeremy, NJ
Response: 2-17-2007; JJR
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