Dissolution of a limited liability company in Alaska is a process that requires documentation to be filed according to the rules set forth by the State of Alaska Division of Corporations.
If you don’t want to incur business penalties and liabilities, you must have a basic understanding of the dissolution process regardless of whether you are permanently closing an alcohol business or moving on to something new.
What specific steps do you need to take to dissolve an LLC in Alaska? Step-by-step instructions will be provided.
Step 1: Examine Your Operating Agreement
Most LLCs do have an operating agreement that has the power to state the processes of dissolution in addition to the other matters. This document may, for example, require approval by the members, liquidation of assets, and distribution of available funds.
The operating agreement is, for lack of a better word, a document that defines how a business’s resources, ventured out internally, will be handled, and it usually has some form of guidance on how to close down operations of the business.
In case your LLC lacks an operating agreement which is standard for most businesses, you will be required to abide by default rules of dissolution of an LLC per Alaska statutes.
Step 2: Securing Approval from Members
Dissolving an LLC in Alaska requires member approval as stated by the law. In most cases, this approval can be procured by conducting a member meeting and putting the dissolution to a formal vote, or via written consent. Make sure these details are retained in meeting minutes or a written resolution is created for the decision to dissolve the LLC.
These minutes would come in handy as evidence when there are disputes regarding the auditor resolving the issues or when the auditing takes place.
Step 3: Preparation of Articles of Dissolution
To initiate the dissolution of your LLC, it is crucial to submit the Articles of Dissolution with the Division of Corporations, Business & Professional Licensing in Alaska. Here’s the whole process, step by step:
Obtain the Form: Head over to the website of the Alaska Division of Corporations and download the Articles of Dissolution form.
Fill out the Form: You will need to provide the following details:
- The full name of your LLC as it is registered with the state.
- The date the dissolution is effective or will take place.
- A statement that confirms that the dissolution has been approved following the members’ vote as stipulated in the operating agreement of the LLC or as stated under the laws of Alaska.
- Any other information that the Division of Corporations may need
File the Form: The Articles of Dissolution can be filed via the web, post, or in person:
Online Filing: Articles of Dissolution can be submitted easily by accessing the Division of Corporations portal.
Mail-or-in-Person Submission: The completed articles can be submitted to the following address: State of Alaska Division of Corporations, Business, and Professional Licensing P.O. Box 110806 Juneau, AK 99811-0806 Submit together with a $25 filing fee. The filing fee can change, so you should check the Division’s website for up-to-date information.
Step 4: Inform Creditors and Pay Outstanding Debts/Obligations
Before the dissolution process is complete, all creditors owed money need to be notified and debts settled. Taking this step will clear all possible future obligations to members personally. Send creditors the following written notice:
- The LLC’s intent to dissolve.
- Inform how claims are to be submitted to the LLC.
- Provide a deadline for submitting claims (not less than 120 days from the whirl notice date issued).
If there is potential for all debts to not be met, seek legal or financial counsel to know how to deal with unfulfillable obligations in line with Alaska statutes.
Step 5: Liquidate and Distribute Assets
After all due payments have been settled, you will need to dispose of the remaining assets of the LLC. The process for doing this includes selling buildings, stocks, or any other resources owned by the LLC. The benefits received must be shared in the order below:
- Payments for any unpaid debts or claims must be paid first.
- Refund of capital contributions made by shareholders.
- Disbursement of cash remaining to members based on their ownership interests or as provided in the operative agreement.
Proper records must be kept in this step for every transaction to ensure full accounting.
Step 6: Cancel Business Licenses, Permits, and Registrations
If your LLC has state or local business licenses, permits, or other registrations, you should ensure that these are canceled so there are no further obligations or renewal fee payments.
Cancellations must be done in writing, so you will also need to reach out to the agencies that originally issued the documents and ask for confirmation in writing that these accounts no longer exist.
Step 7: File Final Tax Returns
Before concluding the dissolution process, file your LLC’s final tax returns. This includes:
Federal Taxes: File a final federal income tax return with the IRS. Mark the return as “final” to indicate the LLC’s closure.
Applying for State Taxes: All state tax operations must be performed before the Alaska Department of Revenue and all tax returns must be filed.
Payroll Taxes: For LLCs with employees, payment of all payroll taxes and closure of all employee accounts is necessary.
Sales Taxes: If your LLC used to book sales taxes, then make sure all the sales tax accounts are closed and every balance due is settled.
Be careful not to incur fines and difficult processes that stem from not filing final tax returns, and proceed with the described processes with adequate detail.
Step 8: Maintain and File Necessary Documents
As soon as the dissolution is fulfilled, all significant documents should be kept for the next few years. The relevant documents include but are not limited to:
- Dissolution Articles.
- Last Filed Tax Return and Relevant Documents.
- Statements of Finances reflecting the actual settlement of the debts and distribution of the remaining assets.
- Any minutes or resolutions of meetings in which the decision to dissolve the entity is made.
Keeping all these documents will be useful for LLC audits, legal matters, and other inquiries.
How Easyfiling Can Help
In most instances, dissolving an LLC can be daunting, especially if you do not have prior experience handling the process. EasyFiling offers the solution you need. Our lawyers will help you in each stage of the dissolution process and make sure that all forms are submitted properly and on schedule. Here is how we can help:
Filing the Documentation: We file the Articles of Dissolution, including the relevant documents necessary to ensure that they meet the requirements set forth by the state of Alaska.
Notifying Creditors: EasyFiling has the resources to assist you with drafting the notices to send to your creditors and to help you reduce the chances of being sued.
Taxation: With the knowledge we possess, we can help you with filing the last federal and state tax returns.
Record Keeping: We can make recommendations on the records that should be kept for future purposes.
Holistic Support: You will be assisted by a member of our staff during the entire process and details of any concerns you may have will be addressed.
We handle all the administrative work on your behalf, allowing you to focus your energy on other ventures. Engaging with us at EasyFiling will allow you to save time. Book a free consultation today to dissolve an LLC in Alaska.
FAQs About Starting a Business in Alaska
1. In Alaska, how long does it take to dissolve an LLC?
The length of time varies depending on your pace with completing the steps. If submitted online, filing the Articles of Dissolution with the Alaska Division of Corporations may take a few business days. Still, the entire process can take anywhere from weeks to months when settling debts and returning taxes.
2. What occurs if I fail to dissolve my LLC?
If you fail to dissolve your LLC, you may encounter unnecessary burdens such as annual reports, taxes, and penalties. Those who lent money may continue to make claims towards the LLC and its members and because of that, it is important to properly deal with the dissolution.
3. Is it necessary to notify the IRS upon LLC dissolution?
In the event of dissolving your LLC, there is a need to file a final federal tax return while marking it as “final” to inform the IRS that the LLC is no longer functioning. Moreover, your Employer Identification Number may also require closure.
4. Can I dissolve my LLC if there are still debts owed?
Before dissolving your LLC, settle any existing dues or contact creditors to make payment arrangements. Speak to a legal or financial expert about addressing pending obligations within the framework of Alaska regulations.
Nabin Adhikari
