How To Close An LLC In Michigan? Detailed Answers
Reviewed by Kristina Knight, Journalist , BA
The article is checked by our editorial team, Which includes entrepreneurs who are painfully aware of how overwhelming and challenging it is to start a business for the first time.
If you have a domestic Michigan LLC that you want to shut down, the official way to do that is by dissolving your Michigan limited liability company. But it’s a little more complicated than submitting a dissolution form.
That’s why we’ve created this guide. It covers everything LLC members need to know about obtaining a valid certificate of dissolution under Michigan law. So keep reading to learn how to proceed with the LLC dissolution of your Michigan business.
Read More: Best Registered Agent Services 2024
What Is The Process To Dissolve An LLC?
LLC dissolution involves filling out a dissolution form and paying a filing fee. But before your Michigan business can do that, it will have to pay outstanding taxes and business debts if it’s not in good standing with the Michigan Secretary of State.
Your Michigan Limited Liability Company will also need to obtain something called a tax clearance certificate by submitting a tax clearance request form to the Department of Treasury. But don’t worry; we cover this all more in-depth in the next section.
How Do I Dissolve An LLC In Michigan?
Review your operating agreement
The first thing you should do is look at your Michigan LLC operating agreement. This document will outline any specific procedures you need to take before filing for a certificate of dissolution for your LLC in Michigan.
Often, the operating agreement will tell you what percentage of LLC members need to agree to the dissolved Michigan LLC in order to proceed with obtaining a certificate of dissolution.
But even if you don’t have any instructions for your LLC in Michigan in its operating agreement, the department of regulatory affairs will let you proceed by conducting a unanimous vote of LLC members. If all LLC members vote in favor of shutting down the business entity, then you’ll be able to begin the dissolution process.
File articles of dissolution
After the dissolution meeting takes place, you’ll be ready to file articles of dissolution with the Michigan Department of Treasury and Secretary of State. However, in order to dissolve an LLC, the company must be in good standing with the state.
This means that you may need to pay off your company’s debts before proceeding, including tax obligations and any applicable fees and fiscal obligations in order to restore good standing.
Obtain a tax clearance certificate from the Michigan Department of Treasury
Once you’ve filed your official paperwork and paid any additional fees you incur, then it will be time to obtain a tax clearance certificate from the Michigan Department of Licensing and Regulatory Affairs. All Michigan LLCs must do this within 60 days of filing the certificate of dissolution with the Michigan Department of Treasury.
That being said, there really don’t seem to be any penalties for not obtaining a tax clearance form. You should do it because that’s what the state wants you to do. But there are no specific consequences that you will face if you don’t, outside of, perhaps, not being able to proceed with the dissolution of your company as quickly as you would like.
Complete the LLC wind-up process
Now all that’s left to do is to go through the so-called LLC wind-up process. This just means tying up any loose ends that your Michigan LLC may still have before officially shutting down permanently.
Some of the tasks that you may want to complete during this step, include:
- Taking care of any remaining tax liabilities so you can shut down tax accounts and bank accounts
- Distributing all the assets you have left to your LLC members
- Changing your mailing address before you formally dissolve
- Paying any remaining common taxes and submitting the final tax returns for any connected business with remaining assets and tax accounts through the Department of Treasury
How Long Does It Take The State Of Michigan To Process The Filing?
When you voluntarily dissolve an LLC in Michigan, you have the option of paying an expedited processing additional fee to have a same-day review of the formal documents you submit for your business. However, even if you don’t pay that fee, you can dissolve a Michigan LLC within 3-5 days, as that’s how long it takes the Department of Treasury and Michigan Secretary of State to complete normal processing.
Top 2 LLC Services
If you have a Michigan LLC that you want to dissolve, then you can file Michigan LLC articles of dissolution on your own, or you can hire a company to help you out.
The following two businesses can help you navigate the treasury website, communicate with the Michigan Secretary of State, and wind down any remaining LLC assets and business accounts you may have, among other services.
| ZenBusiness | Northwest | |
| Award | Best Overall | Most Affordable |
| Detail | Read Review | Read Review |
| Link |
ZenBusiness
ZenBusiness offers a wide variety of services that can help you voluntarily dissolve a Michigan LLC. They’ll work with you to conduct a dissolution vote, file certificate of dissolution, and submit claims. They can also help foreign LLCs who have filed online to dissolve a Michigan LLC and perform other types of services for your business.
Northwest Registered Agent
Northwest is generally a bit more affordable for regulatory affairs like filing a Michigan LLC operating agreement, obtaining a tax clearance certificate, and dissolving your Michigan LLC. They don’t quite provide as many Michigan LLC services as ZenBusiness for a commenced business and expedited service may be harder to come by as a foreign LLC, but they’ll keep your limited liability company in good standing with the Michigan Secretary of State.
Final Thoughts
Completing the LLC dissolution process for your Michigan LLC doesn’t have to be complicated. You simply need to complete a tax clearance request, follow the rules laid out in your Michigan LLC operating agreement, and then file for LLC dissolution with the Michigan Secretary of State and Regulatory Affairs Corporations.
That being said, you may run into some issues with Licensing and Regulatory Affairs or the Tax Clearance Division if you have outstanding taxes due on your LLC in Michigan or other issues with various tax accounts and the tax status of your business name. In these situations, your business may want to hire a professional service for support.
Frequently Asked Questions (FAQs)
To shut down your Michigan LLC officially, you need to dissolve the business. This involves submitting a certificate of dissolution to Licensing and Regulatory Affairs, and submitting a tax clearance request for your Michigan LLC, among other steps.
If you just do nothing, you likely won’t be personally liable for any large fines or penalties. Instead, you will probably lose your business name and your Michigan LLC may be dissolved administratively if you stop paying fees.
The entire process of dissolving your business in Michigan can cost as little as $10. That’s the filing fee that you’ll pay when you submit the Michigan LLC dissolution forms. But if you want expedited processing for your LLC in Michigan, then that’ll carry a higher fee.
The entire process of dissolving your Michigan business can be completed in under a week. It just depends on how long the state takes to process the paperwork that you submit, which usually takes between 3 and 5 days.
Yes, it’s entirely possible to fill out all of the paperwork for Michigan LLC dissolution on your own. However, it can sometimes be helpful to work with professional service providers, such as ZenBusiness or Northwest – especially if you have unusual circumstances with your Michigan company.
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- Close or sell your business. (2023). Close or sell your business. [online] Available at: https://www.sba.gov/business-guide/manage-your-business/close-or-sell-your-business.
- Michigan.gov. (2023). Limited Liability Companies. [online] Available at: https://www.michigan.gov/lara/bureau-list/cscl/corps/limited-liability-co.
- Michigan.gov. (2023). Restore my LLC. [online] Available at: https://www.michigan.gov/lara/bureau-list/cscl/corps/how-do-i/renewals/restore-my-llc.
- Michigan.gov. (2023). Dissolution. [online] Available at: https://www.michigan.gov/lara/bureau-list/cscl/corps/limited-liability-co/filling-requirements-continued/dissolution.