How to Reinstate a Dissolved LLC

To get a dissolved LLC back, you’ll need to submit a reinstatement request through the Secretary of State office in your home state, then pay any outstanding fees or fines, and your LLC will be reinstated. Most states allow reinstating an LLC, but it can depend on how your LLC was dissolved and how long your LLC was inactive. Each state has different requirements and costs.

Your LLC didn’t dissolve for nothing. Most of the time, it was due to failure to submit an annual report, an unpaid fee, or the resignation of the registered agent. The state sent notices, and nothing was done; then the state revoked the LLC.

The good news is that most states allow you to reinstate a dissolved LLC rather than start a new one. The downside is that it’s handled differently in each state, and the longer you wait, the more difficult and costly it becomes.

If you voluntarily dissolved your LLC, it may not be possible to reinstate it, also depending on the state you are in. This article will primarily focus on administratively dissolved LLCs, since that is what we have most commonly seen.

What Causes Administrative Dissolution

Administrative dissolution is when the state cancels your business for failing to comply with its regulations. Here are the most common reasons that cause this automatic dissolution.

• The annual report was not filed.
• The business no longer has a registered agent or registered office.
• State franchise taxes were not paid.
• Previous filings were paid with insufficient funds.

Administrative dissolution should not be confused with voluntary dissolution, where the members vote to formally close the business. Normally, an LLC with administrative dissolution remains obligated to settle its debts and file tax returns, even if it is not permitted to conduct business.

Some states allow you to fix the compliance issue before the administrative dissolution is finalized. Other states are automatic. In California, your LLC is suspended before the administrative dissolution is finalized. This provides a brief opportunity to reinstate the LLC without a full reinstatement.

How to Reinstate a Dissolved LLC: The General Process

These steps can be used to reinstate your LLC in almost every state.

Step 1: Research the reason for the administrative dissolution.
Visit the Secretary of State’s website to review the LLC’s current status. The filings should show the reason for the LLC’s dissolution.

Step 2: Pay the LLC’s franchise tax, if required, and submit a reinstatement request.
In most states, the underlying issue must be resolved, such as missing annual reports and filing fees. Only then will the state allow the reinstatement request to be processed.

Step 3: Ensure the registered agent is active.
If your LLC dissolved because your registered agent is no longer in business, you will have to get a new registered agent either in conjunction with or prior to filing for reinstatement.

Step 4: Submit the reinstatement application.
This will usually be called an Application for Reinstatement. Some states have different titles for this application. Some states, like Wyoming and New Mexico, allow this application to be filed electronically. Other states will still require that a printed copy of this application be mailed to them.

Step 5: Pay the reinstatement fee.
This fee is in addition to any other outstanding fees for the filing of the annual report. The reinstatement fee will be $25 in Kentucky and will exceed $500 in California, where there is a $250 penalty for the outstanding annual state fees and taxes.

Step 6: Wait for processing.
Most states will take two to six weeks for standard processing on reinstatement applications. Some states may allow processing to be as few as three business days for a fee.

Reinstatement Fees and Timelines by State

Reinstating an LLC involves more than just paying a filing fee. When reinstating an LLC, you can expect to pay some combination of:

• The reinstatement fee
• The fee for any state taxes or franchise fees due
• The fees for any missed annual reports
• The late fees for the reports and taxes

California has a special requirement that must be completed before the Secretary of State can reinstate a suspended or dissolved LLC. The Franchise Tax Board must issue a tax clearance certificate. This alone can take weeks, especially if there are outstanding taxes or unfiled tax returns.

When Reinstatement Is Not Possible

There are some reasons reinstatement is not an option.

In some states, the window to reinstate an LLC after dissolution has closed. In others, there is no limit.

The name you selected for your LLC might belong to another entity. Because of that, you’ll have to change your name or get the other LLC to relinquish it.

The LLC voluntarily dissolved, and your state does not allow reinstatement after voluntary dissolution. New York is one example.

You have outstanding tax debt with the Franchise Tax Board or the Department of Revenue that remains unresolved.

In these cases, the most feasible option is to establish a new LLC and transfer business contracts, accounts, and assets to it. Although this is a time-consuming process, it may be the only option.

Common Mistakes When Reinstating an LLC

Thinking reinstatement will fix everything. Once an LLC is reinstated, a bank account or any licenses that were closed during the dissolution will not reopen. You will have to negotiate contracts and apply for your business license again.

Clearing taxes after paying reinstatement fees. In states that require tax clearance, you must clear your taxes with the FTB or Department of Revenue before paying the Secretary of State.

Failing to check name availability. Your application to reinstate your LLC will be denied if someone else registered the name while your LLC was dissolved.

Failing to update the registered agent along with the reinstatement. A registered agent must be appointed at the same time as, or before, reinstating the LLC, especially if the LLC was dissolved due to a lack of a registered agent.

Thinking BOI reporting is paused during dissolution. If your LLC had a BOI filing obligation under FinCEN‘s Beneficial Ownership Information reporting requirements before it was dissolved, you should ask a compliance professional whether that obligation exists during the dissolution or after reinstatement.

Reinstating a Foreign LLC

If your LLC was formed in one state but registered to do business in another (known as foreign qualification), dissolution in your home state may cause administrative revocation in the foreign state, too.

The typical process for reinstating a foreign LLC is to reinstate in the formation state first. Then you must apply for reinstatement or make an application for the first time in every foreign state in which your LLC has been registered. All states will charge their own filing fees and may have their own requirements.

Are you ready to reinstate your LLC? Easyfiling takes care of all filings, pays the back fees, and sets up your registered agent so your LLC is back in good standing without having to deal with the Secretary of State.