Case Study: Closing a Texas LLC

Overview

Global Atlas Enterprises, LLC was ending its business and needed to close the company formally in Texas, so it would not keep owing franchise tax reports, penalties or state fees. In50States managed the process and filed the Certificate of Termination with the Texas Secretary of State.

The challenge

State tax status. Before a company is closed, its Texas franchise tax obligations and required reports need to be in order.
An accurate filing. The Certificate of Termination has to follow the Texas Business Organizations Code, or the Secretary of State can reject it and cause delay.
Stopping ongoing duties. An LLC that is only left idle keeps its yearly reporting duties. Closing it formally ends them going forward.

Closing a company ends its state filing duties from that point on. It does not cancel taxes owed for earlier periods.

What we did

1. Review before filing

We checked that the company’s state franchise tax obligations and required information reports were complete and that it met the state’s requirements for a voluntary termination.

2. The Certificate of Termination

We prepared the Certificate of Termination and filed it with the Corporations Section of the Texas Secretary of State.

3. State approval

The Secretary of State issued a Certificate of Filing for the termination, dated and effective March 1, 2024.

Mar 1, 2024Texas Secretary of State files the Certificate of Termination, effective the same day.

The result

Texas recognizes the LLC as terminated effective March 1, 2024. The owners have the Secretary of State’s certificate as official proof of the closing date, and the company no longer carries yearly state reporting from that date.