If you formed a US LLC from outside the United States and now want out, closing it properly means three separate actions in three separate places. You settle what the company owes. You file a dissolution or cancellation document with the state that registered it. Then you finish the company’s federal filings with the IRS. Skip the third and the first two do not protect you.
That third part is why this guide exists. A foreign-owned single-member LLC has a federal filing obligation — Form 5472 attached to a pro forma Form 1120 — that does not go away when the state marks the company dissolved, and the penalty for missing one is $25,000. Most “how to dissolve an LLC in [state]” pages, including the six state pages this guide replaces, cover the state form and stop there.
Below: the order to do things in, the federal filings in detail, what the filing is called and costs in ten states, what really happens if you just walk away, and why closing may be the wrong answer if your only real problem was banking.
This is general information about US filing requirements, not legal or tax advice for your situation. Your final-year federal position depends on facts we cannot see from here — have a cross-border accountant confirm it before you file.
The order to do this in
Order matters here more than most guides admit. Two things belong at the end: the money leaving the company, and the bank account closing.
- Check how your LLC is allowed to dissolve. Read the operating agreement first. If there isn’t one, the state’s default rule applies, and the default is usually consent of all members. For a single-member LLC this is a written note to file, not a meeting — but write it, date it, and keep it.
- Collect what you are owed and pay what you owe. Chase outstanding invoices, cancel subscriptions and software billed to the company, cancel any licences or permits, and settle creditors. A dissolved LLC does not erase a debt the company owes.
- Distribute whatever is left to yourself — and record the amount and the date. You will need that figure for Form 5472. Money moving from the LLC to its foreign owner on winding up is a reportable transaction, not a private transfer.
- File the state dissolution or cancellation document. The form name, fee and filing method vary by state — see the table below. In some states this filing is conditional on your state tax account being current, so read that column before you start.
- File the final federal return. For a foreign-owned single-member LLC this is a pro forma Form 1120 with Form 5472 attached, covering the final year — including the winding-up transactions from step 3. This is due in the year after the year you close.
- Write to the IRS to close the EIN business account. The IRS does not cancel an EIN. It deactivates the account, and only after your outstanding returns are filed.
- Close the business bank account last. Keep it open until every payment that could still arrive has cleared: the state filing fee, a final state tax bill, a refunded charge, a chargeback. Closing the account first is the single most common way founders end up unable to pay a $150 state bill and watching it turn into a penalty.
Steps 4 and 5 are not strictly sequential — the federal return runs on the IRS calendar, not the state’s, so it will usually be filed months after the state has closed the entity. California is the exception worth knowing about: the Franchise Tax Board wants the final state return filed first, and the Secretary of State cancellation filed within 12 months of it (FTB Publication 1038, checked September 2026).
The federal filings the state guides never mention
Your final Form 5472 — and why the closing year is the riskiest one
If your LLC has one member and that member is not a US person, the IRS treats it as a disregarded entity for income tax but as a corporation for one narrow purpose: the reporting rules of section 6038A. In the IRS’s words, “a foreign-owned U.S. DE is treated as an entity separate from its owner and classified as a corporation for the limited purposes of the requirements under section 6038A that apply to 25% foreign-owned domestic corporations” (Instructions for Form 5472, Rev. December 2024, checked September 2026).
What that means in practice: for any year in which the LLC had a reportable transaction, it files a pro forma Form 1120 with Form 5472 attached. The instructions define a reportable transaction to include “any transaction listed in Part V”, and Part V for a foreign-owned US DE covers “any other transaction… including contributions to, and distributions from, the entity.”
Read that against step 3 above. The year you wind the company up is, almost by definition, a year with reportable transactions — you paid the last supplier from company funds, you moved the remaining balance to your own account, you may have written off a loan you made to the company at the start. Founders who correctly filed for every trading year sometimes assume the closing year needs nothing because the company “wasn’t operating.” That is backwards. The closing year is often the one year that definitely has a reportable transaction in it.
The mechanics, from the same instructions:
- On Form 1120 you complete only the name and address of the DE and items B and E on the first page, and write “Foreign-owned U.S. DE” across the top.
- Form 5472 is attached to it.
- It cannot be e-filed. Fax it to 855-887-7737, or post it to Internal Revenue Service, 1973 Rulon White Blvd, M/S 6112, Attn: PIN Unit, Ogden, UT 84201.
The penalty language is blunt: “A penalty of $25,000 will be assessed on any reporting corporation that fails to file Form 5472 when due and in the manner prescribed.” If the failure continues more than 90 days after the IRS notifies you, a further $25,000 applies, and then repeats for each 30-day period after that. Dissolving with the state does not make an unfiled 5472 go away — the obligation attached to a tax year that has already happened.
If you are not sure whether your earlier years were filed, deal with that before you close, not after. Our guide to US tax filing requirements for international founders covers which forms apply to which structure.
The IRS does not cancel an EIN
Every one of the state guides this page replaces told readers to “cancel your EIN.” That is not a thing the IRS does. From Canceling an EIN – closing your account (page last reviewed 5 November 2025, checked September 2026):
- “Once we assign an EIN to a business entity, it becomes that entity’s permanent federal taxpayer ID number.”
- “If you no longer need your employer identification number (EIN), we can’t cancel it, but we can deactivate it.”
- “If you made tax payments, owe business taxes or received a notice to file a business tax return, you must file all outstanding tax returns and pay taxes owed before we can deactivate your EIN.”
To deactivate it you send a letter. The IRS asks for “your entity’s EIN, legal name, address, EIN assignment notice, if available, and your reason for deactivating.” Mail it to either:
- Internal Revenue Service, MS 6055, Kansas City, MO 64108
- Internal Revenue Service, MS 6273, Ogden, UT 84201
The IRS page lists both with “Or” between them and gives no rule for choosing. Keep a copy of the letter and proof of posting; there is no online confirmation and no acknowledgement you can rely on arriving. Because deactivation only happens once outstanding returns are filed, this letter belongs after the final Form 5472, not before it. If you need a refresher on what the number is for, see what an EIN number is.
State by state: what you file, what it costs, where
All fees and form names below were checked on the state’s own site in September 2026. Fees change; check the state page linked in each row before you pay.
| State | What you file | State fee | Where | Tax condition first? |
| Wyoming | Articles of Dissolution | $60 | By post only — the form states it “cannot be accepted via email.” Up to 15 business days. | None on the form |
| New Mexico | Articles of Dissolution (Form DLLC-DV) | $25* | NM SOS online portal — the SOS no longer accepts paper business filings | None on the form |
| Delaware | Certificate of Cancellation | $220 | Division of Corporations | Yes. The fee schedule reads “Cancellation – domestic (plus annual taxes to cancel)” |
| Florida | Articles of Dissolution | $25 | Sunbiz, online or by post | None stated |
| California | Certificate of Cancellation (LLC-4/7). A Certificate of Dissolution (LLC-3) must come first unless all members voted to dissolve and you say so on the LLC-4/7 | No fee | bizfileOnline | No clearance certificate, but the cancellation must state a final return has been or will be filed with the FTB. See below. |
| Colorado | Statement of Dissolution | $10 | Colorado SOS, online only — the fee schedule lists paper as “n/a” | None stated |
| Arizona | Articles of Termination (Form L031) | $35, or $70 expedited | Arizona Corporation Commission, eCorp or post | None stated. Publication of the Articles of Termination is not required |
| Arkansas | Statement of Dissolution (LL-04), plus a Final Franchise Tax Report | $45 online / $50 paper, plus $150 for the final franchise tax report | Arkansas SOS | Yes, in effect. The SOS fee page says the final franchise tax report “must be submitted with form LL-04” |
| Alabama | Domestic LLC Articles of Dissolution | $100 | Post two copies plus a stamped self-addressed envelope to Secretary of State, Business Services, P.O. Box 5616, Montgomery, AL 36103 | None on the form |
| Alaska | Articles of Dissolution (Form 08-490) | $25 | Division of Corporations, online or post; roughly 10–15 business days | None on the form |
* New Mexico’s $25 is the fee on the Secretary of State’s own DLLC-DV instruction sheet and in NMSA 1978 §53-19-63. We could not re-confirm it inside the current online portal, which requires a logged-in session, so treat it as the published fee rather than a quote from the checkout screen.
Two general warnings about this table. First, “none stated” means the dissolution form itself imposes no tax-clearance condition — it does not mean you have no state tax to settle. Second, none of these fees include what a registered agent may charge to stay appointed until the filing clears, and in Arizona the Corporation Commission expects your statutory agent to remain in place until termination is processed.
California is the expensive one to get wrong
California charges an $800 annual tax to every LLC doing business or organised there, and the Franchise Tax Board states the position in one sentence: “This yearly tax will be due, even if you are not conducting business, until you cancel your LLC” (ftb.ca.gov, checked September 2026). It is due by the 15th day of the 4th month from the date you register with the Secretary of State, and it repeats every year the entity exists on the state’s records.
That is why a dormant California LLC is not a harmless thing to leave alone. Two dormant years is $1,600 plus penalties, and the state does not need you to have earned a dollar.
What the FTB asks for, to stop it:
- File all delinquent returns and pay the balances, penalties, fees and interest.
- File the final-year return with the Final Return box checked on page one.
- Stop doing business in California after the final taxable year.
- File the cancellation with the Secretary of State within 12 months of the filing date of the final return (FTB Publication 1038). Miss that window and the annual tax can pick up again for the following year.
The Secretary of State side is free. Its FAQ says plainly: “There is no filing fee associated with submitting a termination document to the Secretary of State.” The certificate of cancellation must state that a final franchise tax return has been or will be filed with the FTB, and a separate Certificate of Dissolution is not needed if the dissolution was voted by all members and the certificate of cancellation says so (California Corporations Code §17707.08).
One route that sounds useful but usually is not, for readers of this site: California’s FTB Abatement and Voluntary Administrative Termination lets a qualifying entity that certifies “that it is not doing business and does not have any remaining assets” have unpaid qualified taxes, interest and penalties abated. It is limited to California-formed LLCs and corporations — the page states the process “is not available for foreign (formed outside of California) stock corporations or foreign (formed outside of California) limited liability companies.” If your LLC is a Wyoming or Delaware company merely registered in California, this is not open to you.
What happens if you just stop paying
Nothing dramatic, at first. That is the problem — the cost builds quietly for two or three years and then arrives all at once.
The state moves you to delinquent, then dissolves you administratively. Florida is the clearest published timeline: miss the 1 May annual report and a $400 late fee applies to LLCs, and “if you do not file an annual report by the third Friday of September, your business entity will be administratively dissolved or revoked in our records at the close of business on the fourth Friday of September.” Wyoming works on a 60-day notice: once the Secretary of State notifies an LLC that a required filing or fee is outstanding, the company is “deemed defunct” unless it complies within sixty days (W.S. 17-29-705).
The bill does not stop when the state stops you. Delaware is the one to watch, because its annual tax is assessed on existence rather than activity: “All Domestic and Foreign Limited Liability Companies, Limited Partnerships, and General Partnerships formed or registered in Delaware are required to pay an annual tax of $400.00”, due on or before 1 June, and “annual taxes are assessed if the entity is active in the records of the Division of Corporations anytime during January 1st through December 31st of the current tax year.” Late means “a penalty of $200.00 plus 1.5% interest per month on tax and penalty” (corp.delaware.gov, checked September 2026). Being active for one day in January costs the full $400 — which is a decent argument for cancelling in December rather than January.
Getting back in costs more than staying in. Wyoming will reinstate an administratively dissolved LLC within two years, but you pay a $100 reinstatement fee plus every delinquent annual report and its fee. Colorado charges $25 for a periodic report, $50 as a late penalty, $100 for a Statement Curing Delinquency and $100 for reinstatement. Florida reinstatement is $100 plus each missed year’s annual report fee, and the Florida LLC annual report itself is $138.75.
Your registered agent can resign, and that starts its own clock. This surprises people who assume the agent will simply keep forwarding mail. Under Wyoming’s Registered Offices and Agents Act, an agent resigns by filing a statement of resignation and must state it gave the entity at least 30 days’ notice; the appointment ends on the day that statement is filed. The company then has 30 days to file a statement of change. Until it does, “service of process on the business entity shall be upon the secretary of state”, and “upon receipt of resignation by a registered agent where no successor is appointed, the secretary of state shall classify the entity as delinquent awaiting administrative dissolution, revocation or forfeiture.” In Wyoming, reinstating after the agent lapsed adds a $250 penalty and a $5 fee for appointing a new agent on top of the $100.
The practical effect is that lawsuits, tax notices and state warnings go to an address that no longer forwards anything to you. You find out years later.
And an administrative dissolution does not touch your federal position. The state removing your LLC from its register says nothing to the IRS. If a Form 5472 was due for 2024 and never filed, it is still due, the $25,000 penalty still applies, and the entity being dissolved in 2026 does not retroactively remove a 2024 obligation. This is the single most expensive misunderstanding in this whole subject, and it is the reason the cheap option — walking away — is often the expensive one.
Before you dissolve, consider
Most non-resident founders who ask us about dissolution are not closing a failed business. They are closing a company whose bank account never opened. Those are different problems and closing only solves one of them.
If the LLC works but the banking does not:
- The rejection was probably about residence, not about your company. Several US fintechs decide on where the beneficial owner lives, not on where the LLC is formed, so a second application to the same provider from the same country fails the same way. What actually differs between providers, and what documents each one wants, is in our guide to opening a US business bank account as a non-resident.
- A business account is not the only way to get paid. Multi-currency accounts with US routing details solve receiving money for a lot of founders who were declined by a US bank — see using a Wise Business account with a US LLC.
- Never solve it by misstating where you live. Giving a bank or payment provider a US address you do not live at is a false statement on an account application. It gets accounts frozen with funds inside them, and it is a far worse outcome than a polite decline.
If the problem is the state rather than the business — annual costs higher than you expected, or a state you picked badly — dissolving and re-forming is one option, but compare it against the cost of simply moving where you are registered. Our comparison of the best states to file an LLC sets out what each one actually charges each year.
And if you might want the company again later: check whether the state allows reinstatement and for how long before you file a dissolution. Wyoming allows two years. A voluntary dissolution is usually final in a way a delinquency is not, and the name may not still be free when you come back.
How Bizstartz can help
We handle US company dissolution for founders outside the US. On our company dissolution service page, the work is: filing the Articles of Dissolution (or the equivalent document) with the state, a final compliance and report check, guidance on closing the IRS account, coordinating the final tax filings, and written confirmation once the state has closed the entity. Pricing is on request.
What we will not tell you is how long your state will take. Processing times are set by the state, not by us. Wyoming’s own form says up to 15 business days after it receives the paperwork; Alaska publishes roughly the same; several states publish nothing at all. We will tell you what your state publishes and what we have seen recently, and nothing beyond that.
Frequently asked questions
Do I still have to file Form 5472 for the year I close the LLC?
If the LLC had any reportable transaction in that year, yes. Distributions from the entity to its foreign owner are listed in Part V of Form 5472, so the winding-up payment you make to yourself is itself a reportable transaction. The closing year is often the one year that definitely requires a filing.
Can the IRS cancel my EIN when I close the company?
No. The IRS says an EIN “becomes that entity’s permanent federal taxpayer ID number” and that “we can’t cancel it, but we can deactivate it.” You send a letter with the EIN, legal name, address, the EIN assignment notice if you have it, and your reason. It is only deactivated once your outstanding returns are filed.
What happens if I just stop paying the state fees?
The state marks the LLC delinquent and eventually dissolves it administratively, but the fees that already accrued stay owed, penalties are added, and your registered agent may resign — after which state and legal notices go to the Secretary of State rather than to you. It also has no effect on any unfiled federal return.
Is it cheaper to dissolve or to let the LLC lapse?
Dissolving is almost always cheaper. State dissolution fees in the ten states above range from nothing in California to $220 in Delaware. Letting it lapse can mean Florida’s $400 late fee, Delaware’s $200 penalty plus 1.5% monthly interest, or California’s $800 a year continuing until you cancel.
Does dissolving the LLC cancel a tax filing I already missed?
No. A federal filing obligation attaches to a tax year that has already happened. Dissolving the company in 2026 does not remove a Form 5472 that was due for 2024, and the $25,000 penalty for a missed one still applies.
How long does dissolution take?
It depends entirely on the state and we will not guess for you. Wyoming’s own form says processing takes up to 15 business days after receipt; Alaska publishes roughly 10 to 15 business days; several states publish no processing time at all. States can and do run backlogs.
Related Guides
- How to Get a Certificate of Good Standing for Your U.S. LLC
- US Tax Filing Requirements for International Founders
- How to Open a US Business Bank Account as a Non-Resident
- Best States to File an LLC
Closing a company properly matters as much as opening one — an LLC left unfiled keeps accruing state obligations. Our dissolution service handles the filing for you.
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