Before your S corporation can dissolve, you must obtain shareholder approval. Typically, this will involve holding a shareholders meeting as outlined in your corporate bylaws. Even if this is not required by your corporation’s bylaws, Georgia law provides procedures for shareholders to approve dissolution, and your Notice of Intent to Dissolve must include a statement that the shareholders approved the dissolution.
Notice of Intent to Dissolve
Once you have obtained shareholder approval, you must file a Notice of Intent to Dissolve with the Corporations Division of the Georgia Secretary of State. No later than the next business day after filing with the Secretary of State, the corporation must mail or deliver a publication notice about the dissolution to the designated newspaper for legal notices in the county of the corporation’s registered office. This notice allows the dissolving corporation’s creditors to make claims against it as part of the dissolution process.
Payments and Distributions
Once the Notice of Intent to Dissolve is filed, the corporation may only conduct certain activities in connection with dissolving and cannot conduct its regular business. Your S corporation must pay its creditors, debts and taxes. Corporate assets may need to be sold to pay these debts; remaining assets are then distributed to the shareholders according to the numbers of shares they hold.
Articles of Dissolution
The corporation must also file Articles of Dissolution with the Georgia Secretary of State to finalize the dissolution. There is no fee for filing the Articles of Dissolution. If the corporation has not paid all its debts or distributed its assets to the shareholders at the time of filing, it must indicate it has made adequate provisions to pay any pending debts or finalize distributions. The corporation must also file any regular annual registrations that are due before dissolution since the corporation’s registration must be current before the Articles of Dissolution will be accepted by the state.