Why "just stop paying" is a trap
Yes, the state will eventually administratively dissolve your LLC for unpaid fees. Before and after that point: penalties accrue on unfiled state reports, the IRS's Form 5472 obligation doesn't evaporate ($25,000 per missed year, and the LLC's final year still counts), the abandoned bank account fails a periodic review and gets frozen or escheated, and your Schedule FA keeps needing to disclose an entity you're pretending stopped existing. Abandonment converts a ~$100 filing and a month of tidiness into an open-ended liability with your name on it, and it stays visible to any future US bank or platform that screens you.
The correct sequence
- Decide the effective date and stop new business cleanly, final invoices out, subscriptions cancelled, clients notified.
- Collect receivables and pay everyone the LLC owes, including the contractors, the state, and your tax preparer. Distributing money to yourself while creditors are unpaid is personal-liability bait.
- File Articles of Dissolution with the state (Wyoming: $60; Delaware: Certificate of Cancellation $220, with franchise tax paid current first). The state must be square before it lets you leave.
- Take the final owner draw, distribute remaining assets to yourself, on the books, after debts.
- Close the bank accounts, after the final draws and any refunds clear, not before.
- Close the IRS account: final Form 5472 + pro-forma 1120 marked final for the dissolution year, and a letter closing the EIN account (the EIN itself is never reused or cancelled, but the account should be closed).
- Keep the records, formation-to-dissolution paperwork, seven years, digitally. Future-you occasionally needs to prove the ending.
The final tax lap
The dissolution year is a normal tax year, shorter: the 5472/1120 pro-forma still reports the year's related-party transactions, including your final liquidating distribution, and files by the usual deadline, marked final return. If the LLC held US-situs assets or the wind-down involves anything beyond cash (equipment, IP transfers to you), get the return prepared professionally; liquidation edge cases are exactly where DIY filings go wrong quietly.
The your home country-side close-out
Founders who set the investment up correctly find this a formality; founders who never filed your home country side discover that closing is when the gap surfaces, banks scrutinise final repatriations precisely because it's the last look.
What closing costs
| Item | Typical cost |
|---|---|
| State dissolution filing | $60 (Wyoming) - $220 (Delaware) + any outstanding fees |
| Final 5472/1120 preparation | A few hundred dollars, professionally prepared |
Wind-down is one of the separate services we offer, including for LLCs we didn't form, in whatever state their paperwork is in. The messier the history, the more it's worth handing over.
If you might come back
Genuinely pausing rather than ending? The maths favors keeping a Wyoming LLC alive: ~$160/yr (annual report + agent) preserves the entity, the EIN, the bank account and the aging, against re-forming, re-EINing (weeks) and re-onboarding banking later. Dissolve when the story is over; hibernate when it's an intermission. And if the LLC was fine but the platform wasn't, that's not dissolution, that's switching providers, which is far cheaper.
