Closing your Florida limited liability company (LLC) will involve filing paperwork with the state government and wrapping up your business's final affairs. Among the most important tasks are what's known as "dissolving and winding up" the business.
This article covers information specific to dissolving and winding up your Florida LLC. Key elements of the dissolution procedure are laid out in the following sections of Florida law: Fla. Stat. §§ 605.0701 and following (2023).
For general step-by-step guidance, see our article on the steps to take to dissolve your LLC.
Your LLC is registered with the State of Florida. Officially ending its existence as a state-registered business entity—and by extension, putting it beyond the reach of creditors—begins with a formal process called "dissolution." While an LLC might be involuntarily dissolved by the state or a court, here we are concerned with voluntary dissolution by the LLC owners (called "members").
Dissolving your business refers to the process of voting to end your LLC and filing the appropriate paperwork with the Florida government.
Winding up your business refers to the process of:
To voluntarily dissolve your LLC, you first should look at the company's formational documents:
In most cases, one of those two documents will contain a section with rules for how to dissolve the company. Typically the rules will require a vote of the LLC members on a resolution to dissolve, and more specifically a requirement that some percentage of members vote in favor of the resolution. For example, your operating agreement might require two-thirds of the LLC members to vote to approve the dissolution for the vote to pass.
Make sure you follow any specific procedural requirements that might be part of the dissolution rules, such as setting a specific time to meet and vote and giving advance notice to all members regarding the meeting.
Florida's LLC laws. If your articles of organization or operating agreement don't specify when and how the LLC can be dissolved, you'll need to apply Florida's default rules for LLCs. Under Florida law, you can dissolve your LLC with the consent of all LLC members. (Fla. Stat. § 605.0701 (2023).)
Recording your decision to dissolve. For either dissolution approach—relying on rules in formational documents or on the consent of all LLC members—you should make sure to record the decision to approve the dissolution. You can record this action in the official minutes of the dissolution meeting or on a written consent form.
Note that if you have any legal actions or proceedings filed by or against your business, dissolving your LLC doesn't stop these actions.
Florida doesn't require you to obtain tax clearance before dissolving your LLC. Nevertheless, it's a good idea to file the following tax-related documents as part of dissolving your LLC:
When you file your federal tax return, check the "final return" box on your IRS Form 1065 (if your LLC is classified as a partnership for tax purposes) or IRS Form 1120 (if your LLC is classified as a corporation for tax purposes).
Following the vote to dissolve your LLC, the company continues to exist for the purpose of taking care of final matters that, collectively, are known as "winding up" the company. You'll probably designate one or more LLC members or managers to handle the winding up.
Under Florida's LLC laws, key winding-up tasks include:
Only the first three listed items—discharging debts, settling and closing the business, and distributing remaining assets—are required under Florida law. The other items are not required. (Fla. Stat. § 605.0709 (2023).) But all of these tasks are natural and important steps in closing your business. Avoiding any of them can put you and your business at risk—financially and legally.
When settling your company's debts and distributing its assets, Florida law requires you to make payments in a particular order:
(Fla. Stat. § 605.0710 (2023).)
For example, suppose Windward Management is a Florida LLC that has three members: Kyle, Lara, and Maria. The three members have equal membership interests and all agree to dissolve the business. After liquidating its assets, the company has $100,000 to distribute.
First, the LLC must pay off its creditors. So, the business pays the remaining $10,000 on a loan and $5,000 in taxes, leaving $85,000. Second, the company must pay Lara back for the $25,000 she contributed to the business when it first started out. Third, the LLC can distribute the remaining $60,000 to the members in the proportion in which they shared distributions prior to dissolution. Because the members always have shared equally, each member will receive $20,000.
Unlike some other states, Florida doesn't require LLCs to notify creditors of the company's dissolution. Even though it's not required, you should let creditors know that you're planning on or have dissolved your LLC. In your notice, you should tell your creditors that they should submit any claim against you to a specified address by a specified date.
You should also put a notice of your LLC's dissolution in a local newspaper. Again, while not required, publishing a dissolution notice can help protect you from liability. For example, a creditor probably couldn't argue that you intentionally avoided paying a debt by secretly dissolving your business if you published your dissolution in the newspaper.
Florida law does provide rules you can follow to notify known creditors as well as potential, unknown creditors. These rules cover specific information to put in a written notice to a known creditor (Fla. Stat. § 605.0711 (2023)) and how to publish a notice for unknown creditors (Fla. Stat. § 605.0711 (2023)). Under Florida law, if you follow these notice rules, you can dispose of any claim that a creditor doesn't notify you of by the given deadline. For example, if a creditor has four months to notify you of their claim and that deadline passes without the creditor sending you notice, then the claim is void and you don't have to worry about addressing it further.
Is your LLC registered or qualified to do business in other states? If so, you must file separate forms to terminate your right to conduct business in those states. Depending on the states involved, the form might be a:
If you don't file the additional termination forms, you'll continue to be liable for annual report fees and minimum business taxes.
Florida doesn't require a general business license. But depending on your business and profession, you might be required to have different licenses and permits. You should cancel any licenses, permits, and registrations associated with your business. You might be able to sell or transfer some permits.
You also need to close any bank accounts in your business name. In addition, make sure to end or settle any contractual obligations. You might be able to assign your contract rights and obligations to someone else.
When all of the property and assets of your LLC have been properly distributed, you need to cancel your articles of organization by filing articles of dissolution with the Division of Corporations (DOC). The articles of dissolution will at least contain:
You might also be asked to provide other information, such as the document number issued by the DOC when you filed articles of organization to form your LLC, or the name and address of the person responsible for winding up the company if there are no remaining LLC members.
The articles of dissolution must be signed by an authorized individual, such as an LLC member or legal representative. As of 2023, the filing fee for the articles is $25. You can either file the articles online on the DOC website or download an articles of dissolution form. The downloadable document includes a cover letter form.
Be aware that your business name will become available for use by others once your LLC is dissolved.
Dissolving and winding up your LLC is only one piece of the process of closing your business. For further general guidance on many of the other steps involved, see our checklist for closing your business and read about what you need to know about closing a business.
If you have further questions or need legal assistance, you should talk to a Florida business attorney. Many business owners can dissolve their LLCs on their own. But you might want to seek legal help if there are disagreements among members, complicated debt settlement negotiations, or ambiguous contract assignment terms.