Are you ready to stop doing business with your New York corporation, but you’re not sure how the official dissolution process works?
The state of New York 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 New York 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.
Rocket Tip: Most company formation services are also able to dissolve your entity for a small fee. They’ll take care of the paperwork so you can move on. Two popular options are LegalZoom and Incfile.
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 Certificate of Dissolution with the New York Department of State.
- Fulfill all tax obligations with the state of New York, 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 Certificate of Dissolution. With that in mind, let’s dive into the details of this step.
How to Dissolve a New York 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.
Once the board has reached a resolution, you will need to file the Certificate of Dissolution with the New York Department of State. This form requires the following information:
- Name of corporation
- Date the certificate of incorporation was filed with the Department of State
- The name and address of each officer/director of the corporation
- Method of dissolution
- Affirmation that the corporation elects to dissolve
- Signature of authorized representative
- Applicant’s name and mailing address
In addition to the Certificate of Dissolution, you will also need to attach written consent from the Department of Taxation and Finance. To obtain this consent, you must file your corporation’s tax return and check the box for “Final” on the form. This will let the Department of Taxation and Finance know that your corporation intends to dissolve. Then, they will ensure that all taxes have been paid before providing their written consent.
Once you have this consent, you can file the Certificate of Dissolution, written consent, and a check for $60 payable to the “Department of State.” All three can be mailed or dropped off at this address:
New York Department of State
Division of Corporations
One Commerce Plaza, 99 Washington Avenue
Albany, NY 12231
It will take the Department of State about seven business days to process the filing, in addition to the time it takes the Department of Taxation and Finance to provide written consent.
How to Dissolve a New York 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 process to dissolve a corporation is the same for incorporators. You will still need to file the Certificate of Dissolution, with written consent from the Department of Taxation and Finance.
Once you have obtained written consent, you can file it along with the Certificate of Dissolution and a check for $60 made payable to the “Department of State.” You can either mail or drop off your dissolution paperwork at this address:
New York Department of State
Division of Corporations
One Commerce Plaza, 99 Washington Avenue
Albany, NY 12231
It will take the Department of State about seven business days to process the filing, in addition to the time it takes the Department of Taxation and Finance to provide written consent.
What Else Do I Need to Know About Dissolving a Corporation in New York?
If your corporation has done business in New York City, you will also need to get written consent from the New York City Commissioner of Finance. You can get this consent by mailing the completed Request for Consent to Dissolution form to this address:
New York City Department of Finance Collection Division
Vendor Tax Clearance Unit
59 Maiden Lane, 25th Floor
New York, NY 10038
It is also important to note that once you dissolve your corporation, your business name can be claimed by someone else.
Conclusion
The process to dissolve a New York corporation is the same for businesses that have commenced business and issued shares, and those that have not.
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 New York corporation!