How to Dissolve (Close) an LLC in Arizona

If you have a limited liability company (LLC) in Arizona, you may need to shut down the business at some point. Maybe you’ve started another company or decided to relocate to another state — whatever the reason, you’ll need to follow the somewhat complicated LLC dissolution process. 

If done incorrectly, you’ll still be responsible for annual reports and fees and could face additional penalties. But, lucky for you, this handy guide explains how to dissolve an LLC in Arizona. 

Properly shutting down an LLC involves several crucial steps, as detailed below.  

1. Vote for Dissolution

LLC owners, known as members, must vote to dissolve the LLC. Hopefully, you have an operating agreement that details the process. If not, Arizona law requires a signed record by most members, entitled to more than half of the LLC’s assets. Once you do so, you’ll need to draft a resolution to dissolve the LLC. 

2. Cancel Business Licenses and Permits

If you were required to get licenses and permits for your business, you’d need to contact the issuing agencies to cancel them so that you’re not charged renewal fees. If you have any outstanding fees, you’ll likely need to pay them before you can cancel.

3. Notify Creditors

If you owe money to any creditors, notify them in writing of the dissolution and give them detailed instructions on filing any claims for the outstanding debt. In Arizona, your notice must provide a mailing address for claims and a deadline of at least four months after the notice is received to file any claims.

In Arizona, this must be done before you formally dissolve your LLC with the state. Additionally, this notification does not affect the enforcement of any mortgages, pledges, or liens on your LLC’s property.

4. Notify Tax Departments

Notify relevant tax authorities of the dissolution and pay any outstanding taxes due.

5. Cancel Contracts and Settle Financial Obligations

If you have contracts with vendors, lessors, or any other outstanding financial obligations, you’ll need to ensure all your obligations are fulfilled and all contracts are canceled. 

6. Distribute Assets to Members

If the LLC has any assets remaining in any form after all financial obligations have been settled, they must be distributed to members based on LLC ownership percentages. If the assets are equipment, property, or other non-cash assets, they’ll need to be sold first so distributions can be made in cash. 

7. File the Dissolution Papers with Arizona

In Arizona, officially dissolving your LLC is to wind up all activities, distribute all properties and assets, and then file for termination. You can either file online or physically.

Filing Online

To file your Articles of Termination online, visit the Arizona Corporation Commission (ACC)’s online filing site and create an account.

At the top header, click “Online Services.”

From the left-hand menu, click “Dissolve or Restructure a Business.”

Search for your LLC, and enter your information where prompted. Notice that you can specify an effective date for your termination, and that Arizona requires all properties and assets to be distributed before termination.

Sign and pay for your filing.

Filing Physically

To file by mail or in person, fill out and print out a filing cover sheet and the Articles of Termination. Once again, note that all properties and assets must be distributed before you can file this form.

Bring these documents and your payment to:

Arizona Corporation Commission – Examination Section
1300 W. Washington St., Phoenix, Arizona 85007

Alternatively, you can mail it to the same address. However, you can only pay for mail filings by check or money order payable to the “Arizona Corporation Commission.”

The fee for filing the termination papers in Arizona is $35.

If you’d like to pay more for expedited service (three to five days, the next day, same day, or two-hour), select the option on the cover sheet or online and pay the appropriate fee.

In Closing

Regardless of the reason, LLC dissolution must be done right to avoid legal issues and financial penalties. Therefore, it’s highly recommended that you employ the services of an attorney to ensure everything is done correctly and all bases are covered.