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Sometimes in life we “pretend” to know what we are doing; small business or start-ups tend to have a lot of “fake it till you make it” including things like going on a legal website like legalzoom.com or rocketlawyer.com and starting an LLC. Maybe people told you that there were tax benefits or liability protection or maybe you just wanted to sound more official than saying “Eat at Joes” by putting Joe’s Eatery, LLC. However, you got there, sometimes plans change so here’s some thoughts about what owning an LLC requires.
LLCs require more than one filing when you start your business. For starters, by December 31, 2024, all LLC’s have to file a BOIR report with the Federal government or face fines and sanctions. You can read more about that at our article here: https://cooperlegalfirm.com/2024/04/beneficial-owner-information-reporting/
You also have to file a yearly annual report with the Secretary of State that provides any updates on your Managers and Members and requires a filing fee. If you don’t file that, the Secretary of State will place your LLC into a delinquent status. Annual reports are due for each LLC on the 15th day of the fourth month following the fiscal year end…. For those of you who need that in plain English, the North Carolina Secretary of State considers that to be April 15th, 2024 even though fiscal years and calendar years for businesses sometimes differ. You can always file it on your actual fiscal year just make sure it’s at least once a year and that you have a filing in by April 15th each year to avoid late fees. Notably, the Articles of Organization that you filed with the Secretary of State don’t ask when your fiscal year ends.
The fee to file your annual report is $20 if you file it in time. If you are late, the fee goes up to $100 for reinstatement and file the reports you missed. If your LLC is already revoked by the Secretary of State, you have to pay $275 and do all of the annual reports you missed. It can get quite pricey. If you have an accountant, don’t assume that they are filing your annual report when they file your taxes, they are two separate things and get filed in two separate places. Filing an annual report isn’t’ tied to whether you made money or not, it is a requirement just to keep your LLC active. If your LLC is currently dissolved or revoked, instructions on how to reinstate it are here: chrome-extension://efaidnbmnnnibpcajpcglclefindmkaj/https://www.sosnc.gov/documents/Guides/Business_Registration/FAQ_for_Bus_Corps_Receiving_NOG.pdf
If your LLC is dissolved but you still own property in it, it’s okay. The North Carolina General Statutes at NC General Statutes – Chapter 57D Article 6 https://www.ncleg.net › Statutes › PDF › ByArticle provide that “After its dissolution, an LLC shall wind up. The winding up may include continuing the business of the LLC for a period of time. (b) Subject to subsection (c) of this section, the managers or other applicable company officials shall wind up the LLC after its dissolution”.
You don’t necessarily have to reinstate an LLC just to sell property as it is probably considered as part of the winding down process. The work can be accomplished with a resolution and a proper real estate attorney. The same goes for selling equipment, machinery, or titled assets. If you have other questions on LLC’s, feel free to give us a call.