How to Dissolve an LLC in California: Forms, Fees, Timeline

California LLC Dissolution at a Glance

Dissolving an LLC in California takes two agencies. The Secretary of State cancels the LLC when it files a Certificate of Cancellation (Form LLC-4/7), and the Franchise Tax Board receives the final tax return. The state filing is free, and the $800 annual tax stays due until the LLC is canceled.

Which Form Dissolves an LLC in California

California uses three termination forms for an LLC, and Form LLC-4/7 is the one that ends it. The state groups all three under "Termination" on its forms page. Canceling, closing and dissolving your California LLC all lead you to the same filings.

The vote and Form LLC-3 start the shutdown rather than finish it. The form records the LLC's election to wind up and says the LLC must also file a Certificate of Cancellation to terminate.

Form LLC-4/8 is the shortcut for dissolving an LLC you spun up but never used. Its required statements include that the LLC has not conducted any business since its Articles of Organization were filed and has no debts or other liabilities other than its tax liabilities. The LLC also confirms it has returned any payments received from investors. The Franchise Tax Board says an LLC that files the short form is not subject to the $800 annual tax for its first tax year.

The Steps to Dissolve an LLC in California, in Order

California's steps run from the members' vote to the Certificate of Cancellation. The process is simple, and its order matters: your LLC's standing comes first, and Form LLC-3 goes in before or with Form LLC-4/7. The general order for any state is in our guide on how to dissolve an LLC, and California's checklist runs like this:

1. Check your LLC's standing. A suspended LLC cannot legally close or dissolve until it is revived, according to the Franchise Tax Board, and we explain how suspension happens in our guide to involuntary dissolution of an LLC. To revive it, you file past-due returns, pay past-due balances and file the Application for Certificate of Revivor (FTB 3557 LLC).
2. Record the vote to dissolve. Form LLC-3 lists a vote of 50 percent or more of the members' voting interests, or a greater percentage set in your Articles of Organization or written operating agreement.
3. Wind up your business. The Certificate of Dissolution describes this stage as paying liabilities and distributing assets. If you have debt, talk to your lawyer.
4. File your final California tax return. The Franchise Tax Board asks for three things:
   • All delinquent returns filed and all balances paid, including penalties, fees and interest.
   • The final return for the current year with the Final Return box checked on the first page. The LLC return is Form 568, Limited Liability Company Return of Income.
   • No business done in California after the final taxable year.
5. File with the Secretary of State. Form LLC-4/7 is filed on its own when all members voted to dissolve and the box on the form is checked. Otherwise Form LLC-3 is filed before it or together with it.
6. Close your other state accounts. Sales tax, payroll tax and local licenses each have their own closing step, listed below.

Confirm the list of final returns with your CPA before you file, because the returns an LLC owes depend on how it is taxed.

How to Dissolve an LLC in California Online

You can dissolve an LLC in California online through bizfile Online, the Secretary of State's filing portal.

Filing online requires Basic or Full Access to your LLC's record in bizfile Online. The Secretary of State's FAQ gives the path: find the LLC under My Business Records, select File an Amendment, then follow the prompts for the termination form.

Paper still works. The Secretary of State's forms page says all business forms can be submitted by mail or in person.

The $800 Annual Tax in the LLC's Final Year

California's $800 annual tax is due every year until the LLC is canceled, even if it does no business. It works like a gym membership: you can shut down the website and stop taking clients, and the fee keeps coming until you cancel. The Franchise Tax Board's Publication 1038 says an entity may avoid the tax for the current and later taxable years when it meets all of these requirements:

• The final annual tax return for the preceding taxable year is filed on time, including any extension.
• The LLC stops doing or transacting business in California after the last day of that preceding taxable year.
• The cancellation documents are filed with the Secretary of State within 12 months of the filing date of the final tax return.

The FTB's LLC filing guide (FTB 3556) adds that the LLC pays the $800 annual tax for the tax year of its final return. Your CPA can tell you which year counts as final for your LLC.

Leaving the final return until last is human. The 12-month window between it and your state filing is the date most worth writing down. Starcycle prepares and files your California dissolution paperwork and tracks that date alongside your contract and subscription cancellation timelines. Your final returns are coordinated with a partner CPA or your own.

How Long It Takes to Dissolve an LLC in California

California does not publish a number of days for dissolving an LLC, so your timeline rests on the clocks its pages do name:

• Secretary of State review: submissions are reviewed in the order received, with online submissions given priority. You can see which received date the office is working on at its current processing dates page.
• Effective date: Form LLC-4/7 is effective on the date it is filed with the Secretary of State, according to FTB 3556.

California Tax Accounts to Close

Canceling your LLC with the Secretary of State does not close its tax accounts, which sit with three other agencies. It's natural to picture dissolving as one form. The Franchise Tax Board says a closing business files with the Secretary of State "and us". You close each account separately:

• Franchise Tax Board: your final return, described above, plus any balance due.
• California Department of Tax and Fee Administration (CDTFA): if your LLC holds a seller's permit, CDTFA asks you to close out the account through its online services or with form CDTFA-65, Notice of Close-Out, and to file final returns.
• Employment Development Department (EDD): if your LLC had employees, EDD asks for the final return, wage report and payment within 10 days. It also asks you to close the employer payroll tax account in e-Services for Business.

Your city or county business license is separate from all of these, and you close it with the office that issued it.

Federal Steps After the California Filing

The IRS has its own closing steps, apart from California's. You file a final federal return for the year you close and final employment tax forms if you had staff. Our guide to closing a business with the IRS lists each form. The IRS says it cannot cancel an EIN but can deactivate it, which we cover in our guide to canceling an EIN.

If the LLC Is Registered in Other States

If your California LLC registered to do business in other states, it files a withdrawal in each one. An out-of-state LLC registered in California files Form LLC-4/7 to cancel its California registration, also at no fee.

Closing Your California LLC

California makes the filing itself free. Your work sits in the order of the steps and the 12-month window. If you're comparing states, our breakdown of what it costs to dissolve an LLC sets California's $0 filing fee beside the others.

If you'd like the paperwork off your plate, Starcycle can prepare and file your California forms and keep your documents in one place. We can also make intros to lawyers and accountants.

Frequently Asked Questions

Is canceling an LLC the same as dissolving it in California?

Canceling and dissolving are two stages of the same shutdown in California. The Certificate of Dissolution gives notice that the LLC is winding up, and the Certificate of Cancellation ends its registration. Our guide to LLC termination vs. dissolution explains the terms.

How do you dissolve a single-member LLC in California?

A single-member LLC in California uses the same termination forms as any other California LLC. Form LLC-3 says it is not required when the vote to dissolve was made by all of the members and that fact is noted on Form LLC-4/7.

How do you dissolve a corporation in California?

A corporation in California dissolves through its own termination forms, apart from the LLC set above. You'll find them in our guide on how to dissolve a corporation in California.