What are your alternatives if you own a business in Colorado and your limited liability company (LLC) is in default? Can the LLC be dissolved? Yes, in a nutshell, but there are a few things you should know before acting.
It’s crucial to first and foremost comprehend what it means to have a delinquent LLC. A delinquent LLC in Colorado is one that has neglected to submit its periodic report or pay its annual fee. Numerous factors, like as neglect or financial difficulty, might cause this.
You have the choice to either restore your LLC to good standing or dissolve it if it has fallen behind on payments. Filing the required papers and paying any unpaid fees are required to restore it to good standing. Through the Colorado Secretary of State’s website, this can be done online.
You must adhere to a certain procedure if you choose to dissolve the LLC instead. Articles of Dissolution must first be submitted to the Colorado Secretary of State. On their website, you may also find this form. The LLC will be dissolved after the form is submitted and the cost is paid.
It’s crucial to understand that terminating the LLC does not release you from any lingering debts or responsibilities. Any unpaid fees or taxes, as well as any debts owed to creditors, will remain be your responsibility.
Depending on the particulars of your circumstance, the procedure to dissolve a delinquent LLC can take several weeks to several months. It’s also important to keep in mind that before dissolving the LLC, you might need to get a letter confirming its good standing from the Colorado Secretary of State. This letter attests to the LLC’s good standing and the fact that all filings and fees have been paid on time. A letter of good standing might be obtained within a few days or within a few weeks.
A delinquent LLC may be dissolved in Colorado, but it’s crucial to assess the benefits and drawbacks before taking any action. If you intend to keep running the company, restoring the LLC’s good status would be a preferable choice. If you do want to dissolve the LLC, be ready to cover any outstanding obligations and fees and give the procedure plenty of time.
A Certificate of Good Standing (CGS) is a legal document that attests that a company has been granted permission to operate in a specific state and has complied with all applicable laws and regulations. Its goal is to demonstrate that the business is in good standing with the state and has complied with all of its requirements to the state, which is sometimes necessary for different legal operations like getting a loan or signing contracts. The Secretary of State’s office in the state where the company is registered normally issues CGSs.