To dissolve an LLC company in Maine is no easy task as it involves a series of administrative and legal tasks.
Whether you are permanently closing your business or changing its structure, it is crucial to take the necessary steps to avoid legal consequences or continuing obligations.
This comprehensive guide will help you understand how to dissolve an LLC in Maine.
1. Review Your LLC’s Operating Agreement
Before beginning a dissolution, that which is being statute shall check and balance the company’s operating agreement first. Usually, this document defines the requirements for dissolution. These typically include the following:
- Approval requirements from all members.
- Distribution of present assets
- Procedure for winding up all business affairs.
If your LLC does not possess an operating agreement, you are obligated to adhere to the state laws of Maine regarding LLC dissolution, which is in the Maine Limited Liability Company Act.
2. Vote to Dissolve the LLC
The members of the LLC have the prerogative of dissolving a business. This almost always is subject to a vote. Ensure the decision made is traced in a resolution format. Note the date of the vote, details of the vote, and the signature of the members as well.
Be sure that the method of resolution you adopt is optimal for your operating agreement or meets the requirements of the Maine LLC statutes. This document acts as proof of evidence that the necessary parties agreed to the irreversible document.
3. File the Certificate of Cancellation
To officially terminate your LLC, you are required to submit the cancellation certificate to the Secretary of State of Maine. It is important to take care of this step because neglecting to submit this document will impose further responsibilities on your part, such as filing year reports or maintaining tax payments. Here are the important details:
Form Title: Cancellation Certificate.
Filing Fee: $75 (we recommend checking with the Secretary of State regarding the current fees).
Submission Options:
- Fill the form online through the Secretary of State of Maine’s official webpage.
- Send through mail to the Secretary of State’s Office.
- Hand-deliver to the Secretary of State in Augusta.
Mandatory Information:
- The LLC’s title is registered with the state.
- The date when the LLC will be dissolved.
- The reason for the LLC’s dissolution.
- The contact information for future correspondence.
The cancellation certificate is erasing the status of your LLC. However, this will be issued subject to vetting by the Secretary of State. Once approved, your LLC is officially canceled in Maine.
4. Resolve Outstanding Tax Obligations
Before the full dissolution of your LLC can take place, you ought to clear any pending federal and state tax obligations. This incorporates:
- Doing final federal and state income tax return
- Clearing any pending state tax that includes sale tax, use tax, and even payroll tax.
- Canceling your tax accounts with Maine Revenue Services.
You can obtain a tax clearance certificate from Maine Revenue Services to verify that all tax dues have been paid. With this certificate, you can be assured that your LLC has no open dues with the state.
5. Inform Creditors and Resolve Liabilities
Inform LLC creditors about your decision to disband the company. This action helps limit the liability of LLC members in the future. Set a deadline for claims that should be considered reasonable and comply with Maine regulations. The notice must have:
- The name of the LLC.
- A statement of the dissolution.
- Claim submission procedures and an address for where to send them.
- Closing date for claims (60 calendar days from now).
Before any assets are distributed to the members, all submitted claims must be paid. You also need to store these records for future reference.
6. Allocate Remaining Assets
After all debts and claims are settled, the remaining assets need to be divided among the LLC members. This should be done by the provisions in the operating document or as per default provisions of Maine in case there are none. The following are examples of assets that may be divided:
- Cash is available with the LLC.
- Property of the LLC.
- Funds obtained from selling the assets of the LLC.
Make sure that these listings are well archived to prevent conflicts between members in the future.
7. Cancel Business Licenses and Permits
When shutting down the LLC, cancel proprietary business permits, licenses, and company registrations. This ensures that you do not acquire any fees and other responsibilities that are associated with active license tracking. The most common cancellations are:
- Local business permits and licenses by municipality or county authorities.
- Registration at the state level with authorities in Maine.
- Federal Employer Identification Number (EIN) if applicable.
You can write to the relevant agencies or organizations that issued these licenses for the cancellation process.
8. Close Bank Accounts and Credit Lines
Shut down the LLC’s business bank accounts and lines of credit. This prevents possible non-approval activities after dissolution and ensures all funds in these accounts are accounted for. Ensure that before closing these accounts, you:
- Have settled all unpaid checks and payment transactions.
- Disbursed all remaining funds to members.
Notify the bank of LLC dissolution and provide any documents necessary for account closure.
9. Mainting Business Records
Even when LLCs are dissolved, having copies of records is of utmost importance as they will be required for legal inquiries or tax purposes, hence they should be kept for a minimum of seven years. Some key documents to keep include:
- Tax filing and clearance certificates.
- Meeting minutes along with the dissolution resolution.
- Legal correspondence plus the creditor notification.
- Financial statements together with the bank record.
By ensuring that these records are organized properly and securely, problems and time spent on inquiries on dissolution are minimized.
How EasyFiling Help
Dissolving an LLC for most people is a time-consuming process and can be complicated. However, with the aid of EasyFiling and our team, LLC dissolution in Maine can be far less stressful. Here’s how EasyFiling can help:
Document Preparation and Filing: EasyFiling helps clients file the Certificate of Cancellation with the Maine Secretary of State and ensures that all information is accurate.
Tax Obligations: Clients can rest easy as EasyFiling guides them in resolving all outstanding tax liabilities in addition to obtaining a Tax clearance certificate.
Creditor Notifications: Drafting and distributing voluntary notifications to creditors has never been easier as EasyFiling does it all for you.
Legal Compliance Strategy: Our consultants will ensure that you adhere to all jurisdictions, thereby minimizing any risks of penalties or other issues in the future.
Consultation and Support: EasyFiling helps you with personal assistance when it comes to distributing assets, keeping records, or even closing bank accounts. EasyFiling’s help is easily accessible and customized to meet your specific needs.
Let us worry about the details while you get to focus on your next steps. EasyFiling enables you to save time, reduce stress, and much more. Book a free consultation today to dissolve an LLC in Maine.
FAQs on Dissolving an LLC in Maine
1. What are the repercussions of failing to properly dissolve my LLC in Maine?
If you do not dissolve your LLC properly, you can have unresolved matters such as filing an annual report and paying taxes. Besides that, you can also incur fines and legal issues when creditors or the state has recourse against your LLC.
2. What is the rough timeframe for dissolving an LLC in Maine?
Dissolving an LLC isn’t too difficult if you file the correct documents and settle all obligations as directed. On average, this process can take anywhere from one month to three.
3. Can I dissolve my LLC through the Internet in Maine?
Yes, you can submit the Certificate of Cancellation online using the Maine Secretary of State’s web portal. Most often, it is the fastest and easiest method.
4. Is a tax clearance necessary for LLC dissolution in Maine?
Even though Maine does not require a tax clearance certificate during business dissolution, it is advisable to settle any tax dues with the Maine Revenue Services to avert any repercussions in the future.
Nabin Adhikari
