How to Formally Dissolve a Delaware C Corp.

By River Braun, J.D.

How to Formally Dissolve a Delaware C Corp.

By River Braun, J.D.

Delaware is an appealing state when incorporating a business, as it offers corporate-friendly laws and long-established procedures. When it comes to winding down a corporation, the state offers a streamlined process for formally dissolving your Delaware C corp.

A group of coworkers sitting around a conference table

If you and others in your company want to begin preparing for dissolution, follow these simple steps for a hassle-free wind-down process.

1. Hold a meeting to authorize dissolution.

Before you can formally dissolve a Delaware C corp., the board of directors or stockholders must vote and approve it. As in any other formal meeting, be sure to follow all details, including recording the meeting minutes. Once the voting is complete, ensure that you have documentation on the date the vote took place as well as the official outcome of that meeting.

2. Pay all corporate taxes.

The state of Delaware requires businesses to pay all taxes and fees prior to filing the certificate of dissolution. This includes filing all franchise tax reports with the Delaware Division of Corporations. The state will not accept the document if the business has outstanding taxes and reports.

3. Complete the documentation.

The Delaware Division of Corporations website contains multiple templates, depending on the circumstances. For example, if you dissolve a C corp. prior to beginning business or before issuing shares, you will need to file a different document. Pay careful attention to the templates offered.

A note about short forms: if you determine that your C corporation is only required to pay the minimum Delaware franchise tax, you may use one of those forms, which can be found on Delaware's website. If your business must pay more than the minimum franchise tax, you must use the long form template.

You are free either to create the certificate on your own or to use a template, so long as it contains following information:

  • Complete corporate name
  • Date of incorporation
  • Date when the board authorized dissolution
  • Names, titles, and addresses for all officers and directors
  • Name and signature of the officer authorized to sign for the corporation

Again, depending on the circumstances of the dissolution, the certificate must contain slightly different information. You can provide additional information as needed.

4. Submit the certificate.

Once it is complete, submit the document, along with a cover letter containing the contact information for the corporate agent authorized to answer any questions. You may find a template for the cover letter, also called a "cover memo," on the Delaware Division of Corporations website. Before submitting the certificate, check the fee

schedule to determine what costs are associated with submittal.

After your business has submitted the required documents and paid the applicable fees, the dissolution process takes approximately two to three weeks, unless you opt for one of the expedited services. Additional fees apply for expediting the process. If you fail to dissolve your Delaware C corp. properly, you must pay an annual report late fee, as well as a 1.5 percent interest fee on any outstanding balances. If you are ready to dissolve your Delaware C corporation, ensure that you speak to the other appropriate parties in your business to complete the process efficiently and properly.

This portion of the site is for informational purposes only. The content is not legal advice. The statements and opinions are the expression of author, not LegalZoom, and have not been evaluated by LegalZoom for accuracy, completeness, or changes in the law.