Are you ready to stop doing business with your Hawaii corporation, but you’re not sure how the official dissolution process works?
The state of Hawaii requires corporations to file documentation of a dissolution, which can differ depending on a couple of key factors. What are these factors, and what does the dissolution process include? In this guide to dissolving a Hawaii corporation, we’ll break down all the relevant details.
If at any point you need help, you can use a service like Incfile or Northwest Registered Agent to handle the process for you.
What Does It Mean to Dissolve a Corporation?
In any state, there is a series of steps that needs to be followed in order to properly dissolve a corporation. While this process does vary some from state to state, for the most part it’s necessary to follow this basic plan (unless your corporation has not yet issued shares or started doing business, which we’ll get to shortly):
- Hold a board of directors meeting and formally move to dissolve your corporation. The resolution to dissolve must be agreed upon by a majority of the corporation’s directors. Depending on your corporation’s structure, you may then need to take the vote to your shareholders. Either way, it’s important to take detailed records of this process for your corporate record.
- File the Articles of Dissolution with the Department of Commerce and Consumer Affairs.
- Fulfill all tax obligations with the state of Hawaii, as well as with the IRS.
- Cancel any relevant licenses and permits, along with closing your business bank account.
- Notify customers, vendors, and creditors of your dissolution.
Most of these steps are fairly self-explanatory, but where many corporation owners run into some confusion is when it comes to the Articles of Dissolution. With that in mind, let’s dive into the details of this step.
How to Dissolve a Hawaii Corporation by the Board of Directors
Most corporations must be dissolved by the board of directors, and we discussed the necessity of holding a meeting to reach this resolution in the previous section.
In Hawaii, you will need to file the Articles of Dissolution (Form DC-13) with the Department of Commerce and Consumer Affairs in order to dissolve your corporation. This form requires the following information:
- Corporation name
- Date of dissolution authorization
- Results of dissolution vote
- Effective date of dissolution
- Title and signature of authorized officer
After you have provided all of the information above, you will need to include a check for $25 made payable to the “Department of Commerce and Consumer Affairs.” Then, you can mail the form and the check to this address:
P.O. Box 40
Honolulu, Hawaii 96810
While processing times will vary, you can generally expect your corporate dissolution to process in about 5 business days.
How to Dissolve a Hawaii Corporation by the Incorporators
Sometimes, entrepreneurs need to dissolve their corporation before shares are issued or any business is transacted. In this situation, the incorporator will need to take responsibility for dissolving the corporation.
The dissolution process is the same for corporations that have not conducted business or issued shares. You will need to file the Articles of Dissolution (Form DC-13) with the Department of Commerce and Consumer Affairs, and you must provide all of the same information (see above) as a corporation dissolved by the board of directors.
Additionally, you will still need to include a check for $25 made payable to the “Department of Commerce and Consumer Affairs.” Then, you can mail the form and payment to the same address:
P.O. Box 40
Honolulu, Hawaii 96810
This process generally takes about 5 business days.
What Else Do I Need to Know About Dissolving a Corporation in Hawaii?
When you dissolve a corporation in Hawaii, you forfeit the rights to your business name. This means that other businesses can immediately claim your business name once the dissolution has processed.
It is also important to note that the state of Hawaii can administratively dissolve your corporation if you fail to file your annual report for two years. However, you can revive your corporation by filing the Application for Reinstatement within two years of the administrative dissolution. If you do not revive your corporation within those two years, you will lose the rights to your business name, and will need to register as a new corporation to begin conducting business again.
The process to dissolve a Hawaii corporation is relatively simple, whether you have been in business for years or you have not even distributed shares yet.
Either way, it’s crucial that you complete each step discussed in this guide accurately, because you certainly don’t want to run into any issues with the dissolution process.
We hope this guide helped you answer any questions you might have had about dissolving a Hawaii corporation!