A business owner may decide to dissolve the business for a variety of reasons, ranging from the business not being profitable to wanting to retire and not being able to sell the business or have a family member take over the business.

Dissolution of a business operating as a limited liability company or corporation will usually include filing articles of dissolution with the secretary of state’s office.

A business owner wanting to dissolve a company may want to wind up the business’s affairs, terminate its tax reporting obligations and the payment of annual registration fees, and liquidate any remaining assets.

But a business owner should understand the implications of these actions and the business’s obligations to secured and unsecured creditors, employees, and state and federal tax authorities.

In Ohio, when a business owner decides to dissolve a limited liability company (LLC) or corporation, they must follow a formal process that includes filing articles of dissolution with the Ohio Secretary of State. This process is necessary to legally terminate the existence of the business. Prior to dissolution, the business owner must settle the company's affairs, which involves notifying creditors, settling debts, distributing any remaining assets to the owners, and addressing any claims against the company. The business must also fulfill its obligations to employees, such as paying final wages and benefits. Additionally, the owner must ensure that all tax reporting obligations are met, including filing final tax returns and paying any outstanding taxes. This may involve both state and federal tax authorities, and the business must also terminate its annual registration fees. It is important for the business owner to understand the legal and financial implications of dissolving a business, as failure to properly wind up the business's affairs can lead to personal liability. An attorney can provide guidance on the dissolution process to ensure compliance with all legal requirements and to protect the owner's interests.