Dissolving a Business in Kansas 2024: A Step-by-Step Guide

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How to Dissolve a Business in Kansas

Closing an LLC in Kansas may be a tough decision, but our comprehensive guide is here to help and make the process smooth and worry-free. Understanding the dissolution process is crucial for avoiding future legal and financial liabilities, whether due to financial circumstances or new ventures. Let us be your trusted partner in this final phase of your LLC journey, ensuring seamless closure and protection against liability concerns.

Embark on this final step confidently, as our expert advice guides you through the requirements, procedures, and best practices of dissolving your business in Kansas. Navigate legal formalities, manage outstanding obligations, and file the necessary paperwork with ease, all with the support of LLCBase. Tackle this challenge with us and achieve a secure and successful closure in the ever-changing Kansas business landscape.

What is a Business Dissolution

Kansas LLC Dissolution refers to the process of legally ending the existence of a Limited Liability Company (LLC) registered in the state of Kansas. Dissolving an LLC involves several steps, such as following the LLC’s operating agreement, obtaining necessary approvals from members, settling outstanding debts and taxes, and filing the required dissolution documents with the Kansas Secretary of State.

The dissolution process ensures that the LLC is no longer legally recognized as a separate entity and cannot conduct business activities. Properly dissolving an LLC in The Sunflower State is essential to avoid potential legal and financial liabilities for the members involved.

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Dissolve Your Business in Kansas: 4-Step Guide

Let’s walk you through a 4-step guide to help you dissolve your business in Kansas efficiently and effectively:

Step 1: Follow Your Kansas Operating Agreement

You should have drafted an operating agreement when you initially formed an LLC. This document outlines the procedures and rules for how the business will be managed and operated. The operating agreement should also include information on how to dissolve the LLC.

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Consult Your Operating Agreement

The LLC operating agreement is a crucial document governing your Kansas LLC’s management, operation, and dissolution. It is a legally binding contract between the LLC members, outlining their rights, responsibilities, and obligations.

When you dissolve your Kansas LLC, the first step is to consult your operating agreement. Carefully review the specific provisions related to dissolution and winding up the business. This section should outline the necessary steps, conditions, and requirements for the members to dissolve the LLC properly.

Determine the Required Approvals and Procedures

Upon reviewing the operating agreement, you must identify the required approvals and procedures for dissolution.  These may vary depending on the terms agreed upon by the LLC members.  Common approval methods include:

  • Unanimous Written Consent: In some cases, the operating agreement may require all members to provide written consent for dissolution.
  • Majority Vote: More commonly, the operating agreement will require a majority vote of the members to approve the dissolution. The agreement should specify the percentage needed for approval (e.g., a majority of 51% or a supermajority of 66%).
  • Specific Conditions: The operating agreement may outline specific conditions or events that trigger the dissolution process, such as the death or withdrawal of a member, bankruptcy, or reaching a predetermined end date.
Document the Decisions and Approvals

Once you have determined the proper procedure for dissolution, follow the steps outlined in the operating agreement. It is essential to document all decisions and approvals related to the dissolution of your Kansas LLC. This documentation may include the following:

  • Written consent signed by all members.
  • Meeting minutes reflecting the discussion and vote on dissolution.
  • Any other written records or correspondence related to the dissolution decision.

Maintaining accurate records of the decisions and approvals is crucial. They will be necessary when filing the dissolution documents with the Kansas Secretary of State. They may be required in case of a dispute or legal issue related to the LLC’s dissolution.

Step 2: Close All Tax Accounts

Before you can dissolve your Kansas LLC, you must ensure that all outstanding debts and taxes are settled.

Settle Outstanding Debts and Taxes

Before dissolving your Kansas LLC, settling all outstanding debts and taxes is essential to avoid potential legal and financial liabilities. You must address any balances due to the Kansas Department of Revenue, Kansas Department of Labor, and other state or federal agencies that may apply to your business operations.

  • Kansas Secretary of State: Ensure you have paid any outstanding franchise taxes and fees, including the annual Kansas LLC tax and any additional taxes that apply to your business.
  • Employment Development Department: If your LLC has employees, ensure you have paid any required payroll taxes and filed all necessary employment tax returns with the Kansas Department of Labor.
  • Other Agencies: Depending on your business activities, you may need to settle outstanding debts with other state or federal agencies, such as the Internal Revenue Service (IRS), for federal taxes.
File Final Tax Returns with the Kansas Department of Revenue

After settling all outstanding debts and taxes, you must file your final tax returns with the Kansas Department of Revenue. This process involves:

  • Filing a Final Pub. KS-1520 Form: Complete and submit the Limited Liability Company Return of Income (Pub. KS-1520 Form) for the final tax year of your LLC’s existence. Indicate on the form that it is your final return, and report all income, deductions, and credits associated with your LLC’s activities during the tax year.
  • Paying Remaining Balances: Along with filing your final Pub. KS-1520 Form, ensure that you pay any remaining balances due to the Kansas Department of Revenue, including any late fees or penalties that may apply.
  • Closing Tax Accounts: Inform the Kansas Department of Revenue that you are dissolving your LLC and request the closure of your tax accounts. This is important to avoid any confusion or future tax obligations related to your dissolved LLC.

By properly closing all tax accounts and filing your final tax returns, you can ensure a smooth dissolution process and avoid any potential legal and financial issues arising from unresolved tax obligations.

Step 3: File a Certificate of Dissolution

Once all necessary approvals have been obtained and all tax accounts have been closed, you can officially dissolve your Kansas LLC by filing a Certificate of Dissolution with the Kansas Secretary of State.

Complete the Certificate of Dissolution 

To officially dissolve your Kansas LLC, you must complete and file the Certificate of Dissolution with the Kansas Secretary of State. This form is available on the Secretary of State’s website and requires the following information:

  • LLC Name: Provide the exact name of your LLC as it appears on your Articles of Organization.
  • Secretary of State File Number: Include the LLC’s file number assigned by the Kansas Secretary of State.
  • Dissolution Date: Specify the effective date of dissolution, which can be the filing date or a future date not more than 90 days from the filing date.
  • Signatures: Include the signatures of all members who have approved the dissolution or their authorized representatives.
Review the Form for Accuracy

Before submitting the Certificate of Dissolution, please review it carefully to ensure all information is accurate and complete. Any errors or omissions may cause delays in processing the dissolution or even result in the rejection of the form.

Mail or Deliver the Form to the Kansas Secretary of State

After completing the Certificate of Dissolution, you can mail or hand-deliver it to the Kansas Secretary of State’s office. The address is:

  • Kansas Office of the Secretary of State, Memorial Hall, 1st Floor, 120 S.W. 10th Avenue, Topeka, KS 66612

Please note that a filing fee may be associated with submitting the Certificate of Dissolution. Check the Secretary of State’s website for the current fee schedule and acceptable payment methods.

Once the Certificate of Dissolution is filed and approved, your Kansas LLC will be officially dissolved, and you will receive a confirmation document from the Secretary of State. This document is proof of the LLC’s dissolution and should be kept with your business records.

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Step 4: Notify Interested Parties

Once your LLC has been officially dissolved, it is essential to notify all interested parties of the dissolution. This includes creditors, vendors, and customers. Informing these parties will help ensure that all outstanding debts and obligations are settled and any future liabilities are avoided.

Notify Creditors, Vendors, and Customers

After your LLC has been officially dissolved, informing all interested parties of the dissolution is important to ensure a smooth winding-up process. These parties may include:

  1. Creditors: Notify all creditors of the dissolution to settle any outstanding debts or obligations. This may involve paying off loans, lines of credit, or other liabilities.
  2. Vendors: Inform your vendors about the dissolution so they can cease providing goods or services and close any open accounts.
  3. Customers: Notify your customers about the dissolution to address any outstanding orders, contracts, or warranties. Depending on your business, this may involve refunding, fulfilling outstanding orders, or transferring contracts to another provider.
Settle any Legal Matters

If your LLC is involved in any ongoing legal disputes or matters, it is crucial to resolve these issues before the dissolution is complete. Consult with an attorney to address any pending litigation or legal obligations.

Distribute Remaining Assets to Members

After all outstanding debts, obligations, and legal matters have been addressed, the remaining assets of the LLC should be distributed among the members. The distribution process should follow the provisions outlined in the operating agreement, which may specify the following:

  • Distribution percentages: The operating agreement may outline the percentage of remaining assets each member is entitled to receive based on their ownership interest.
  • Order of distribution: The operating agreement may provide a specific order in which assets are to be distributed, such as cash first, followed by tangible property, and then intangible assets.
  • Valuation of assets: In some cases, the operating agreement may require assets to be appraised or valued before distribution to ensure fair and equitable dispersal among the members.

You can bring your Kansas LLC to an orderly and legally compliant conclusion by properly notifying all interested parties and wrapping up remaining business affairs. This will help protect you and the other members from any potential legal and financial liabilities arising after the dissolution.

Filing Fee to Dissolve Kansas LLC

It is impossible to predict the exact filing fee to dissolve or cancel your Kansas LLC in 2023, as fees are subject to change. However, as of  2021, no fee is associated with submitting the Certificate of Dissolution or the Certificate of Cancellation to the Kansas Secretary of State.

To file a Certificate of Dissolution, you must:

  1. Complete the form with the required information, including the LLC name, file number, and dissolution date.
  2. Obtain signatures from the approving members or their authorized representatives.
  3. Mail or hand-deliver the form to the Kansas Secretary of State’s office.

To file a Certificate of Cancellation, you must:

  1. Complete the form with the required information, such as the LLC name, file number, and the reason for cancellation.
  2. Obtain signatures from the approving members or their authorized representatives.
  3. Mail or hand-deliver the form to the Kansas Secretary of State’s office.

Please note that fees may change over time. Confirming the current fee schedule on the Kansas Secretary of State’s website or by contacting their office directly before filing any documents in 2023 is always recommended.

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FAQs

What are the steps required to dissolve a business in Kansas?
The steps required to dissolve a business in Kansas involve filing the Articles of Dissolution with the Kansas Secretary of State.
What is required to file the Articles of Dissolution?
The business must pay all state taxes owed, file a final tax return, and provide a written certification of the intent to dissolve signed by the board or the members.
When can a business submit the Articles of Dissolution?
A business can submit the Articles of Dissolution after it has paid all its taxes and taken care of its debts and obligations.
Can a business dissolve itself only through Articles of Dissolution?
Yes, the filing of Articles of Dissolution is the required and legally recognized method of dissolving a business in Kansas.
Does Kansas have any specific laws a business should consider when filing the Articles of Dissolution?
Kansas does not have any specific laws that a business should consider when filing the Articles of Dissolution.
Is there a filing fee associated with dissolving a business in Kansas?
Yes, there is a $30 filing fee for submitting the Articles of Dissolution to the Kansas Secretary of State.
What happens after a business submits the Articles of Dissolution in Kansas?
The Kansas Secretary of State will review the documents to ensure they meet the necessary legal requirements and issue a certificate of dissolution if everything is in order.
How long does it take to get the certificate of dissolution in Kansas?
The timing for receiving a certificate of dissolution in Kansas varies but it typically takes roughly 6-8 weeks for processing.
Does dissolving a business in Kansas stop all state tax filing requirements?
No, the business is still responsible for filing a final tax return and paying all outstanding state taxes and fees before they can dissolve.
How does dissolving a business affect its outstanding debts?
The business must ensure all outstanding debts and financial obligations are settled before dissolving.
Can shareholders or other stakeholders be held liable for a business’s debts after it dissolves?
In most cases, stakeholders in a dissolved business are not personally responsible for the debts of the firm, but there may be instances of personal liability if the stakeholders acted negligently.
What are the consequences if a business does not file the Articles of Dissolution upon dissolution in Kansas?
If a business does not dissolve properly and receive a Certificate of Dissolution, it could still be required to pay any applicable fees, taxes, or fines to the state.
Is there a deadline to submit the Articles of Dissolution after a business has dissolved in Kansas?
There is no firm deadline for submitting the Articles of Dissolution after a business has dissolved in Kansas.
Must a business be current on all its taxes before it can dissolve in Kansas?
Yes, a business must be current on all its taxes before it dissolves in Kansas.
Can a business continue operating during the process of dissolving in Kansas?
A business can continue operating while going through the dissolution process in Kansas as long as all necessary taxes and liabilities are met.
Can a business halt the process of dissolution if needed in Kansas?
Yes, if a business needs to halt the process for any reason such as to iron out a remaining legal issue, it can do so and continue where it left off later.
What should a business do with any remaining assets or property after it dissolves?
Any remaining assets or property should be liquidated and any proceeds applied towards dissolving the debts of the business, creating an easier dissolution process.
Does the state of Kansas provide any aide or resources to businesses during the dissolution process?
As the dissolution is mainly a registered agent filing process, Kansas state does not offer extensive legal guidance or assistance pertaining to the dissolution of a business.
Can more than one form of dissolution exist at the same time in Kansas?
No, only one core form of dissolution is accepted in Kansas and is filed through this procedure via the registered agent of the business.
What else must the business do if it has active professional licensing in Kansas?
If the company maintains professional licenses that per professional regulation requires they register an address or phone number listing or clearance by Kansas agencies, the licenses will have to be separately listed.
Can a non-Kansas registered agent sign the Kansas Articles of Dissolution paperwork?
No. the businesses Kansas registered agent is the only authorized and legally registered individual allowed to sign the dissolution paperwork in the bureau of administration.
What is the role of the dissolved company after receiving the Certificate of Dissolution?
After receiving the Certificate of Dissolution, the company ceases to the recognized entity but still must act in accordance with legal statute if any unpaid debts or funds return long after its legally dissolved.
Is there any maneuver out or completing scheduled expenses after submitting the Articles of Dissolution?
The business needs to close on all remaining expenses immediately upon pushing forward their completed documentation with all filings and statues adhered too.
Can corporations maintain status during dissolution?
Dissolving a corporation in Kansas following the proper legal procedure means the entity has officially shuttered.
Will the Corporation papers be available for public designation after dissolution procedings have been finalized?
Corporation designated in Kansas before dissolution with the state should allow a legal process.
Are there any renewal requirements for formalized fees due a year after the effective shuttering date?
Any formalized institution due to payments needs to be reported according to Kansas business laws to reaffirm no unwanted continuing outstanding liabilities after dissolution.
Is there any capability for stakeholders or controlling boards to issue significant funds before dissolving in Kansas as part of a settlement?
Review Kansas business stipulations local practitioners to discern rules specific meetings capital disbursements before fully completing the Kansas organization dissolution process.
What happens if a mistaken naming rejection arises before successfully acquiring terminated documents from the Kansas government after shutting down their business?
Mistakes come with decisions revolving around terminating business creations, and all political definitions must be acquired for disassociated details stating it has removed its entity permanent.
What does it mean to dissolve a business in Kansas?
Dissolving a business in Kansas means formally closing down a business and ending its legal and financial responsibilities.
Who can dissolve a business in Kansas?
Business owners, shareholders, directors, or legal representatives can dissolve a business in Kansas.
What is the first step to dissolve a business in Kansas?
The first step is to file Articles of Dissolution with the Kansas Secretary of State’s office.
Where can I find the Articles of Dissolution form in Kansas?
The Articles of Dissolution form is available on the Kansas Secretary of State’s website.
What information do I need to provide on the Articles of Dissolution form in Kansas?
You need to provide your business name, type, date of incorporation, and the reason for dissolving the business on the Articles of Dissolution form in Kansas.
How much does it cost to dissolve a business in Kansas?
It costs $30 to file Articles of Dissolution in Kansas.
How long does it take to dissolve a business in Kansas?
It takes 1-7 business days for the Kansas Secretary of State’s office to process the Articles of Dissolution.
Do I need to file taxes before dissolving my business in Kansas?
Yes, you must file your final tax returns and pay all due taxes before dissolving your business in Kansas.
What should I do with the business licenses and permits before dissolving my business in Kansas?
You must cancel or transfer all business licenses and permits before dissolving your business in Kansas.
Can a creditor object to the business dissolution in Kansas?
Yes, a creditor can object to the dissolution of the business in Kansas.
Do I need to notify my employees before dissolving my business in Kansas?
Yes, you must notify your employees at least 60 days before dissolving your business in Kansas.
What should I do with the remaining assets after dissolving my business in Kansas?
You should distribute the remaining assets among the business owners or shareholders after paying off all debts and obligations.
Do I need to file for bankruptcy before dissolving my business in Kansas?
No, you are not required to file for bankruptcy before dissolving your business in Kansas.
Can I reactivate a dissolved business in Kansas?
Yes, you can reactivate a dissolved business by filing Articles of Reinstatement with the Kansas Secretary of State’s office.
Can I dissolve a foreign business in Kansas?
Yes, you can dissolve a foreign business in Kansas if it is registered with the Kansas Secretary of State’s office.
What happens to a business name after it is dissolved in Kansas?
The business name becomes available for use by others.
What is the liability of the business owners after dissolving a business in Kansas?
The business owners’ liability ends once the business is dissolved in Kansas.
Can a dissolved business still be sued in Kansas?
Yes, a dissolved business can still be sued in Kansas for certain obligations and liabilities.
Do I need to notify the creditors and customers of the business before dissolution in Kansas?
Yes, it is advisable to notify the creditors and customers of the business before dissolution in Kansas.
Are there any taxes or fees after dissolving a business in Kansas?
You may be required to pay a final franchise tax or other fees after dissolving a business in Kansas.
Can I dissolve a business due to retirement or death of the owner in Kansas?
Yes, you can dissolve a business due to retirement or death of the owner in Kansas.
Where do I need to send the Articles of Dissolution form in Kansas?
You need to mail or hand-deliver the Articles of Dissolution form to the Kansas Secretary of State’s office.
Can I dissolve a business that has not started operating in Kansas?
Yes, you can dissolve a business that has not started operating in Kansas.
Will I receive a confirmation letter after dissolving a business in Kansas?
Yes, you will receive a confirmation letter from the Kansas Secretary of State’s office after dissolving a business.
Can I dissolve a business online in Kansas?
Yes, you can dissolve a business online through the Kansas Secretary of State’s website.
What if I change my mind after submitting the Articles of Dissolution in Kansas?
You can file a Notice of Withdrawal of Articles of Dissolution within 120 days with the Kansas Secretary of State’s office.
Will my business be removed from all state records after dissolution in Kansas?
No, your business name and dissolution information will still appear on state records in Kansas.
Can I dissolve a business with unresolved lawsuits in Kansas?
Yes, but you may need to consult with a lawyer and resolve the lawsuits before dissolving the business in Kansas.
Can I dissolve a business if it has employees in Kansas?
Yes, but you must follow the legal requirements of notifying the employees before dissolving the business in Kansas.

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Conclusion

Dissolving your Kansas LLC is an important and often emotional decision that signifies the end of a business journey. While it may be challenging, ensuring that all legal requirements and obligations are met is essential to avoid future complications or liabilities. By diligently following the steps outlined in this guide and working closely with the relevant state agencies, you can smoothly navigate the dissolution process while maintaining compliance with Kansas regulations.

As you close this chapter in your business journey, remember that new opportunities may lie ahead. We invite you to explore LLCBase with your Kansas LLC dissolution needs. We wish you the best of luck in your future endeavors and hope to assist in any way we can.

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