Pennsylvania Dissolution Package to Dissolve Corporation
Definition and meaning
A Pennsylvania Dissolution Package to Dissolve Corporation is a collection of legal forms necessary for voluntarily dissolving a corporation in Pennsylvania. This process includes filing articles of dissolution and fulfilling specific requirements mandated by Pennsylvania law. It is applicable for corporations that wish to cease operations and settle any outstanding liabilities.
Legal use and context
This dissolution package is governed by Pennsylvania Statutes, specifically under the Pennsylvania Business Corporation Law of 1988. Corporations must comply with the related statutes to ensure a legal dissolution, which involves obtaining necessary shareholder approvals and filing appropriate documentation with the Department of State.
Who should use this form
This form is designed for any business corporation in Pennsylvania that has decided to dissolve voluntarily. It is suitable for both corporations that have commenced business operations and those that have not yet started. Shareholders or incorporators must use this package to ensure their dissolution follows state regulations.
How to complete a form
To properly complete the Pennsylvania Dissolution Package, follow these steps:
- Download the necessary forms, including the Articles of Dissolution and Docketing Statement.
- Fill in the form with accurate information, ensuring all sections are completed as required by state law.
- Prepare the forms for submission by signing where necessary.
- Mail the completed forms along with the filing fee to the proper Department of State address.
Key components of the form
The key components included in the Pennsylvania Dissolution Package are:
- Articles of Dissolution: This form officially initiates the dissolution procedure.
- Docketing Statement: This is necessary for filing the dissolution status with the state.
- Resolution from the Board: A formal resolution proposal for dissolution is required if the corporation has commenced business.
- Notice of Special Meeting: This notice is needed to inform shareholders about the meeting to discuss the dissolution.
Common mistakes to avoid when using this form
When completing the Pennsylvania Dissolution Package, be mindful of the following common mistakes:
- Filing incomplete forms that lack the necessary signatures.
- Neglecting to provide a copy of the required tax clearance certificates.
- Forgetting to mail notices of special meetings to all shareholders.
- Misstating corporation information, such as the exact name as registered with the Department of State.
State-specific requirements
Pennsylvania has specific requirements for corporations wishing to dissolve. These include:
- Obtaining the affirmative vote from the majority of shareholders.
- Properly notifying all creditors through certified mail.
- Following strict guidelines for asset liquidation and liability settlement prior to submitting the dissolution package.
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FAQ
Failing to dissolve the corporation allows third parties to continue to sue the corporation as if it is still in operation. A judgment might mean that shareholders use the money received from distributed assets when the corporation closed down to satisfy judgments against the corporation.
An inactive business is a business that still exists but has no activity, which means no business transactions during a specific year.Even if the business has no income, it may still be considered active for tax purposes. There are many reasons a business may become inactive.
Dissolve the Legal Entity (LLC or Corporation) with the State. An LLC or Corporation needs to be officially dissolved. Pay Any Outstanding Bills. You need to satisfy any company debts before closing the business. Cancel Any Business Licenses or Permits. File Your Final Federal and State Tax Returns.
In most states, to keep a corporation active, the owners must file annual reports and income tax returns. They may have to pay annual fees as well. Failure to do these things can render the corporation inactive. A corporation may also voluntarily become inactive by ceasing to do business.
Step 1: Corporation or LLC action. Step 2: Filing the Certificate of Dissolution with the state. Step 3: Filing federal, state, and local tax forms. Step 4: Notifying creditors your business is ending. Step 5: Settling creditors' claims.
After dissolution, you cannot use the funds remaining in your business bank account for new business. LLC members no longer have the authority to conduct business or do anything that would indicate that the LLC is still active. Your bank account can cover only essential winding up affairs.
When a corporation is dissolved, it no longer legally exists and, in most cases, its debts disappear as well. State laws usually give additional time beyond the dissolution for creditors to file suits for failure to pay any corporate debts or for the wrongful distribution of corporate assets.
After a company is dissolved, it must liquidate its assets. Liquidation refers to the process of sale or auction of the company's non-cash assets.Assets used as security for loans must be given to the bank or creditor that extended the loan, or you must pay off the loan before selling such assets.