How to Dissolve an LLC or Corporation in North Carolina (Form L-07, B-05, B-06)
· RKube Services
A plain-English walkthrough of NC Articles of Dissolution: which form you need (L-07 for LLCs, B-05/B-06 for corporations), the fee, filing online, and the tax steps people miss.
Closing a North Carolina business takes more than stopping work. Until you file Articles of Dissolution with the NC Secretary of State (SOS), the state treats your LLC or corporation as active. It keeps expecting a $200 annual report (LLCs) or a $25 report (corporations) every year, and it can eventually administratively dissolve you with penalties attached. This guide covers which form to use, what it costs, and the steps around it that most people miss.
What are Articles of Dissolution?
Articles of Dissolution are the public filing that formally ends a business entity's existence with the state. After they're filed, the entity can still wind up its affairs: collect receivables, pay debts, sell assets and distribute what's left to owners. It can't carry on new business. A statement of dissolution or "dissolution documents" usually refers to this same filing.
Which NC form do I need?
| Entity | Form | When to use it |
|---|---|---|
| LLC | Form L-07 Articles of Dissolution | Any NC limited liability company that is closing |
| Corporation | Form B-05 | Dissolution by incorporators or initial directors, typically before shares were issued or business began |
| Corporation | Form B-06 | Dissolution approved by the board and shareholders, the usual case for an operating corporation |
Foreign entities (formed in another state but registered in NC) don't dissolve here. They file a withdrawal (Application for Certificate of Withdrawal) instead. To close the company completely, they also dissolve in their home state.
What does it cost?
The SOS filing fee for Articles of Dissolution is $30 for both LLCs and corporations at the time of writing. Expedited service costs extra (24-hour and same-day options). Check the current fee schedule on sosnc.gov before filing, since fees are set by statute and occasionally change.
Step by step: dissolving an NC LLC
- Get member approval. Follow your operating agreement. If it says nothing, NC law generally requires the members' consent. Document the vote in writing and keep it with your records.
- Bring annual reports current. If you owe annual reports, file them first. An entity that is out of compliance creates delays and loose ends.
- File final tax returns. File the final federal return and check the "final return" box: Form 1065 for a multi-member LLC, Form 1120-S for an S corp, or Schedule C on the owner's 1040 for a single-member LLC. File the final NC returns too (CD-401S, D-403 or CD-405 as applicable).
- Close payroll and sales tax accounts. File final Forms 941/940, the final NC-5 withholding return and the final sales tax return. Then close those accounts with the NC Department of Revenue and the Division of Employment Security. Send final W-2s and 1099s.
- File Form L-07 with the SOS online or by mail. You'll need the exact legal name, SOS ID, date of dissolution, and a signature by an authorized person.
- Wind up. Pay or provide for creditors, distribute remaining assets to members, close the bank account and cancel licenses, DBAs and registered agent service.
- Close the EIN account with the IRS by letter once everything is filed. The IRS doesn't cancel an EIN; it closes the business account.
Dissolving an NC corporation
The flow is similar. The board adopts a resolution to dissolve, the shareholders approve it (Form B-06), and you file the articles. Corporations should also file IRS Form 966 (Corporate Dissolution or Liquidation) within 30 days of adopting the plan to dissolve. They should also report liquidating distributions to shareholders on Form 1099-DIV.
Can I file Articles of Dissolution online in NC?
Yes. The NC Secretary of State accepts dissolution filings through its online filing system, and that's the fastest route. Mail filings take longer. Either way, save the filed, stamped copy. Banks, landlords and the IRS sometimes ask for proof that the company was dissolved.
Common mistakes
- Filing dissolution but not final tax returns. The SOS and the NC Department of Revenue don't share a "closed" flag. Open withholding or sales tax accounts keep generating non-filer notices.
- Abandoning the entity instead of dissolving it. Administrative dissolution for missed annual reports isn't the same as a clean close. Penalties and reports can still be owed if you later want to reinstate.
- Distributing cash before paying creditors. Owners can be on the hook for distributions made while debts were unpaid.
- Using the wrong corporate form. B-05 is only for corporations that never really got going. An operating company with shareholders uses B-06.
Changed your mind? Reinstatement
If the state administratively dissolved your entity (for example, for missed annual reports), you can usually reinstate it. Read how to reinstate a dissolved LLC in NC. A voluntary dissolution you filed yourself can generally be revoked within a limited window.
Want someone to handle it?
RKube Services prepares and files this for small businesses in North Carolina and across the US. Call (984) 234-7030 or send us a message and we'll tell you exactly what your situation needs. Bookkeeping clients can start with a free 30-day trial.
This article is general information, not legal or tax advice. State fees and IRS rules change, so confirm current amounts on sosnc.gov or irs.gov before filing.