How to Close or Dissolve an LLC in Michigan: Forms, Fees & Process

1. What Does It Mean to Dissolve an LLC in Michigan?

Dissolving an LLC in Michigan is the formal legal step of ending a limited liability company’s existence after dissolution documents are accepted by the Michigan Department of Licensing and Regulatory Affairs. Simply stopping operations or remaining inactive does not legally close the LLC.

Dissolution typically involves completing wind-up activities, filing Articles of Dissolution, settling debts, distributing assets under the operating agreement, and completing all final federal and Michigan tax filings to ensure removal from state records without future compliance issues.

2. When Should You Close or Dissolve a Michigan LLC?

You should close or dissolve a Michigan LLC when the business has permanently stopped operating, is no longer generating revenue, or has completed the purpose for which it was formed. Voluntarily dissolving the LLC formally ends its legal existence with the Michigan Secretary of the Commonwealth and prevents the state from continuing to treat the company as active for compliance, reporting, and administrative purposes.

This section addresses voluntary dissolution, which is initiated by the LLC’s members. It is different from administrative dissolution, which occurs when the state dissolves an LLC for noncompliance—such as failing to file required Michigan Annual Reports. Voluntary dissolution allows owners to properly wind down the business, close out obligations, and avoid ongoing fees, notices, or unnecessary legal exposure.

Common situations where dissolving a Michigan LLC is appropriate

1. Business inactivity: the LLC has ceased operations and does not intend to conduct business in Michigan or elsewhere
2. Member decision: the LLC’s members have approved permanent closure in accordance with the operating agreement or Michigan law
3. Business restructuring: the LLC is merging, converting to another entity type, or transitioning to a new business structure
4. Inability to continue operations: loss of required licenses, contracts, funding, or overall business viability
5. Proactive closure: formally ending the LLC to stop future Michigan Annual Report filing obligations and reduce administrative or compliance risk

3. Things to Do Before Dissolving an LLC in Michigan

Before dissolving an LLC in Michigan, it’s recommended to complete several preparatory steps to ensure the business is properly wound down and does not leave unresolved legal, tax, or administrative obligations behind. Although Michigan does not require tax clearance or proof of compliance before filing Articles of Dissolution (Domestic LLC), addressing outstanding issues in advance helps reduce the risk of post-dissolution notices, penalties, or continued Michigan Annual Report exposure.

The steps below are best practices rather than formal state filing requirements. They help ensure a clean and orderly closure before the LLC is formally dissolved with the Michigan Secretary of the Commonwealth.

Pre-dissolution checklist (recommended best practices)

1. Review the operating agreement: confirm member approval requirements, voting thresholds, and any dissolution procedures required under the LLC’s governing documents or Michigan law
2. Approve and document the dissolution: obtain formal member approval and record the decision in written resolutions or meeting minutes for legal, tax, and record-keeping purposes
3. Settle outstanding debts and liabilities: pay, resolve, or make reasonable provision for obligations owed to creditors, vendors, employees, contractors, and service providers
4. Wind down business operations: complete or terminate open contracts, notify customers where appropriate, cancel subscriptions, and prepare to close business bank accounts and payment platforms
5. Review Michigan compliance and tax obligations: confirm required Michigan Annual Reports are current and review any outstanding state tax obligations, such as income tax (if applicable), sales tax, employer withholding, or unemployment insurance
6. Review federal tax filing requirements: confirm all required federal tax filings associated with the LLC’s EIN are up to date and determine whether any final federal income, employment, or information returns are required based on the LLC’s federal tax classification
7. Assess federal BOI reporting obligations (if applicable): determine whether a final Beneficial Ownership Information (BOI) update is required due to ownership or control changes. BOI reporting is a federal requirement and applies independently of Michigan dissolution filings
8. Prepare and retain final records: organize financial statements, tax filings, member approvals, annual report confirmations, and dissolution-related documents for future reference or verification

These steps are recommended best practices and are not required by the state before filing Articles of Dissolution (Domestic LLC). Completing them before submitting dissolution documents helps ensure the LLC is properly closed and reduces the risk of post-dissolution tax, legal, or administrative issues.

4. Step-by-Step: How to Close or Dissolve an LLC in Michigan

Closing or dissolving an LLC in Michigan means formally ending the company’s legal existence with the Michigan Secretary of the Commonwealth. While Michigan does not require tax clearance or proof of paid taxes before dissolution, LLC owners should review outstanding Michigan Annual Reports, tax obligations, and unresolved business matters before filing to avoid future notices, penalties, or compliance issues after closure.

Important: The only filing required to legally dissolve a Michigan LLC is Articles of Dissolution (Domestic LLC). The steps below outline both the required filing and recommended actions to ensure a clean and complete wind-down.

1. Approve the dissolution (required): obtain member approval as outlined in the LLC’s operating agreement or, if none exists, in accordance with Michigan law, and document the decision in writing
2. Wind down business affairs (recommended): settle outstanding debts and liabilities, resolve or terminate contracts, notify creditors where appropriate, and cease ongoing business operations
3. Review Michigan compliance and tax accounts (recommended): confirm required Michigan Annual Reports are filed and review any outstanding state tax obligations, such as income tax (if applicable), sales tax, employer withholding, or unemployment insurance
4. Review federal tax and reporting requirements (recommended): confirm all federal filings associated with the LLC’s EIN are complete and determine whether any final federal income, employment, or information returns are required
5. Prepare the Articles of Dissolution (required): complete the Articles of Dissolution (Domestic LLC), the form that officially terminates the LLC’s legal existence under Michigan law
6. File the Articles of Dissolution (required): submit the form online or by mail with the Michigan Secretary of the Commonwealth. The current filing fee is $30 for online filings and $50 for paper filings. Online filings are typically processed the same day or within one business day
7. Confirm dissolution status (recommended): retain proof of filing and verify the LLC’s status shows “Dissolved” in Michigan Secretary of the Commonwealth records, confirming the company is no longer active

5. DIY vs Professional LLC Dissolution Services

Michigan LLC owners can either complete the dissolution process themselves or seek professional assistance. Michigan’s dissolution requirements are relatively straightforward, and many single-member or inactive LLCs with no outstanding obligations can successfully dissolve without outside help. The most appropriate approach depends on the LLC’s ownership structure, compliance history, and whether unresolved legal, tax, or administrative matters exist.

What typically increases the complexity of dissolving a Michigan LLC?

1. Multiple members or unclear voting and approval requirements under the operating agreement
2. Outstanding debts, contracts, or unresolved creditor claims
3. Overdue Michigan Annual Reports, administrative dissolution history, or open state or federal tax accounts

When professional dissolution support may be helpful

1. Reducing the risk of missed steps, improper sequencing, or incomplete wind-down activities
2. Guidance on Michigan-specific requirements, including filing Articles of Dissolution (Domestic LLC) and resolving compliance issues
3. Added confidence that the LLC is properly dissolved and no longer subject to ongoing annual reporting or administrative notices

6. Filing Fees, Processing Time, and Approval Timeline

Understanding filing fees and processing timelines helps set realistic expectations when closing or dissolving an LLC in Michigan. While the filing process itself is relatively fast, the overall timeline depends on whether required Michigan Annual Reports are current and how quickly documents are submitted to and accepted by the Michigan Secretary of the Commonwealth.

Michigan LLC dissolution filing fee

Michigan charges a state filing fee to dissolve an LLC by submitting Articles of Dissolution (Domestic LLC) to the Michigan Secretary of the Commonwealth. The current filing fee is $30 for online submissions and $50 for paper filings. Michigan does not require tax clearance from the Michigan Department of Treasury before Articles of Dissolution can be filed.

Processing time

Articles of Dissolution filed online are typically processed the same day or within one business day, provided the filing is complete and any required Michigan Annual Reports are current. Paper filings generally take longer due to mail handling. Michigan does not typically offer expedited processing because standard processing times are already short.

When the LLC is officially dissolved

A Michigan LLC is considered officially dissolved once the Michigan Secretary of the Commonwealth accepts and records the Articles of Dissolution (Domestic LLC). At that point, the LLC’s status in state records will show as “Dissolved”, and ongoing annual reporting and entity-level compliance obligations generally end.

Post-approval considerations

After dissolution is approved, retain copies of the filed Articles of Dissolution and the acceptance confirmation from the Michigan Secretary of the Commonwealth. These documents may be required for future tax matters, banking closures, contract terminations, audits, or legal verification.

If you prefer assistance with document preparation, filing coordination, or compliance review, FormLLC can help ensure your Michigan LLC dissolution is completed accurately and without unnecessary delays or follow-up issues.

7. Final Tax Filings and Compliance Related to Dissolution

Although Michigan does not require tax clearance before an LLC can be dissolved, owners should complete all applicable final tax filings and properly close related compliance accounts to avoid future notices, penalties, or enforcement actions after dissolution.

• Bring Michigan Annual Reports current: ensure all required Michigan Annual Reports are filed through the year of dissolution. Annual reporting obligations generally continue until Articles of Dissolution (Domestic LLC) are filed with and accepted by the Michigan Secretary of the Commonwealth.
• Resolve outstanding Michigan tax obligations: identify and pay any unpaid state taxes, such as income tax (if applicable), sales tax, employer withholding, or unemployment insurance contributions, including any accrued penalties or interest.
• File final Michigan tax returns (if required): submit any applicable final state tax returns through the Michigan Department of Treasury and clearly mark them as final where appropriate. While tax clearance is not required for dissolution, registered tax accounts should be properly closed.
• Complete final federal tax filings: file all required federal returns associated with the LLC’s EIN, including final income, partnership, S corporation, or employment tax filings, depending on the LLC’s federal tax classification.
• Close state and local tax accounts: formally close or update any active Michigan tax registrations, such as sales tax licenses or employer withholding accounts, to prevent future reporting obligations.
• Cancel licenses and permits: terminate any Michigan state or local business licenses, permits, or registrations associated with the LLC to avoid renewal notices or fees.
• Retain dissolution and tax records: keep copies of final tax filings, annual report confirmations, and the filed Articles of Dissolution (Domestic LLC) for future reference, verification, or audit purposes.

8. What Happens If You Don’t Properly Dissolve an LLC in Michigan?

Simply stopping business operations does not legally close an LLC in Michigan. Until Articles of Dissolution (Domestic LLC) are filed with and accepted by the Michigan Secretary of the Commonwealth, the LLC continues to exist as a legal entity in Michigan’s business records—even if the company is no longer operating.

Failing to complete a voluntary dissolution can expose owners to ongoing compliance and financial risk. This is different from administrative dissolution, which occurs when the state dissolves an LLC for noncompliance—such as failing to file required Michigan Annual Reports. Administrative dissolution is a state enforcement action and does not properly close the business or eliminate liabilities.

• Continued legal existence: Without filed Articles of Dissolution, the LLC remains active in Michigan records and continues to be recognized as a legal entity.
• Ongoing reporting and fee exposure: Michigan Annual Report obligations and related late fees may continue to accrue until the LLC is formally dissolved.
• Liability is not eliminated: Administrative dissolution does not end responsibility for unpaid debts, contracts, or tax obligations.
• Member and compliance risk: Unresolved contracts, creditor claims, or incomplete wind-down activities can create ongoing legal or financial exposure for LLC members.
• Future filing complications: Improperly closed LLCs may face delays or additional requirements when reinstating, dissolving later, or forming new businesses in Michigan.

9. Closing a Foreign LLC Registered in Michigan

What is a foreign LLC?

A foreign LLC is a limited liability company that was formed in another U.S. state or jurisdiction but is registered to conduct business in Michigan. If a foreign LLC no longer conducts business or has ceased operations in Michigan, it must formally withdraw its registration with the state to end Michigan-specific compliance, reporting, and Annual Report obligations.

Withdrawal vs. dissolution

Michigan does not recognize a “foreign LLC dissolution.” Instead, a foreign LLC must file for withdrawal to terminate its authority to transact business in Michigan. Withdrawal does not dissolve the LLC in its home state—it only ends the company’s legal presence in Michigan.

To withdraw, the LLC must file an Application for Withdrawal (Foreign LLC) with the Michigan Secretary of the Commonwealth. Any dissolution or permanent closure of the LLC itself must be completed separately in accordance with the laws of the state or jurisdiction where the LLC was originally formed.

Common requirements to withdraw a foreign LLC from Michigan

• File an Application for Withdrawal (Foreign LLC) with the Michigan Secretary of the Commonwealth
• Pay the $5 Michigan state filing fee for foreign LLC withdrawal
• Ensure all required Michigan Annual Reports are filed and current through the year of withdrawal
• Resolve any outstanding Michigan tax obligations, such as income tax (if applicable), sales tax, or employer withholding, through the Michigan Department of Treasury
• Confirm the LLC’s status in its home state remains active, withdrawn, or properly dissolved, as required by that jurisdiction

After withdrawal is approved

• The foreign LLC is no longer authorized to conduct business in Michigan
• Registration with the Michigan Secretary of the Commonwealth and Michigan annual reporting obligations generally end
• Proof of withdrawal should be retained for tax records, banking matters, audits, and future business registrations

10. Conclusion

Closing or dissolving an LLC in Michigan is a formal legal step that permanently ends a business’s existence under state law. Simply stopping operations is not sufficient—an LLC remains active in Michigan records until Articles of Dissolution (Domestic LLC) are filed with and accepted by the Michigan Secretary of the Commonwealth.

By following the proper dissolution process—bringing Michigan Annual Reports and tax matters current, completing the necessary wind-down steps, and filing Articles of Dissolution—LLC owners can close their businesses with confidence and avoid future compliance issues. Michigan’s low filing fees and typically fast processing make voluntary dissolution straightforward when handled correctly. If you prefer guided assistance, FormLLC can help ensure your Michigan LLC is dissolved accurately and without unnecessary delays or follow-up complications.