When you look up how to close an LLC, you will see different words: dissolution, cancellation, termination. Some states use one word, some use another. This can make you think the process is different, or that you are looking at the wrong form. In most cases, these words describe the same thing: the owners decide to close the LLC and tell the state. This guide explains what each word means, which document each of our 12 states uses, and why "administrative dissolution" is something else.
The short answer
A voluntary closing of an LLC has two parts:
- The decision and the filing. The members approve the closing as the operating agreement requires. The LLC then files a document with the Secretary of State.
- Winding up. The LLC pays its debts, collects what it is owed and distributes what is left to the members.
States give the filed document different names. The name tells you which form to use. It does not usually change what you need to do. For the full process, see how to dissolve an LLC.
What each word means
Dissolution
Dissolution is the most common word. It means the LLC has decided to stop doing business and start winding up. Many states call the document "Articles of Dissolution". Some call it a "Statement of Dissolution" or a "Certificate of Dissolution".
In some states, dissolution is the first of two steps. The LLC is dissolved, it winds up, and then a later filing ends its existence for good. The states we cover do not have this second step. If your state works this way, check with the state what the second filing is and when it is due.
Cancellation
Cancellation is the word Delaware and Virginia use. In Delaware, the LLC files a "Certificate of Cancellation". In Virginia, it files "Articles of Cancellation". The idea is the same: the LLC's registration with the state is cancelled, and it no longer exists as a company.
Termination
Termination is the word Arizona, Montana and Georgia use. Arizona and Montana use "Articles of Termination", and Georgia uses a "Certificate of Termination". Again, this is the document that tells the state the LLC is closing.
The document name in each state we cover
This table shows the name of the state's document for a voluntary closing, for the 12 states we cover.
| State | Document name |
|---|---|
| Arizona | Articles of Termination |
| Colorado | Statement of Dissolution |
| Delaware | Certificate of Cancellation |
| Florida | Articles of Dissolution |
| Georgia | Certificate of Termination |
| Indiana | Articles of Dissolution |
| Montana | Articles of Termination |
| Nevada | Articles of Dissolution |
| North Carolina | Articles of Dissolution |
| Oregon | Articles of Dissolution |
| Virginia | Articles of Cancellation |
| Wyoming | Articles of Dissolution |
If your state is not in the table, email us at contact@closellcnow.com. For the fees that go with each document, see how much it costs to dissolve an LLC.
What "administrative dissolution" means
Administrative dissolution sounds similar, but it is very different. It is not something you file. It is something the state does to your LLC.
When an LLC misses its annual reports or does not pay its fees, the state can dissolve it on its own. Some states use other words for this, such as "inactive", "revoked" or "forfeited". Whatever the word, it is not a voluntary closing, and it does not close the LLC in a clean way:
- Fees and penalties can keep building up, and the state can pursue them.
- Many states allow the LLC to be reinstated, but only after everything owed is paid.
- The IRS is not told anything. The EIN account stays open, and the IRS can still expect returns.
For a foreign-owned single-member LLC, this matters a lot. Form 5472 is due every year the LLC exists, and the penalty for not filing it is $25,000 per form, per year. Read our full guide on administrative dissolution to learn what to do if this has already happened.
Voluntary vs. administrative: side by side
| Voluntary dissolution | Administrative dissolution | |
|---|---|---|
| Who starts it | The members | The state |
| Why it happens | The owners decide to close | Missed annual reports or fees |
| Fees and penalties | Brought up to date before filing, in most states | Can keep building up |
| Can it come back | Not intended to | Often yes, through reinstatement |
| Is the IRS told | No, you close the EIN account yourself | No |
What the state filing does not do
Whatever your state calls it, the state filing only deals with the state. It does not close anything with the IRS. After the state accepts the filing, the LLC still needs to:
- file its final federal tax return, see the LLC final tax return,
- close its EIN business account, see closing an EIN business account,
- close bank, payment and state tax accounts,
- cancel the registered agent, but only after the state confirms the dissolution.
Our close LLC checklist puts every step on one page.