If your LLC no longer makes sense, close it properly. In Delaware, an LLC doesn’t die on its own: while it remains on the register, it continues to accrue the Franchise Tax each year, with penalties and interest if you don’t pay. The formal closure is called cancellation (Certificate of Cancellation).
Before cancelling: put your house in order
- Wind down the business: collect outstanding payments, pay debts, and distribute what remains to the members
- Close your U.S. tax obligations: if you had reporting obligations to the IRS (for example, as a non-resident LLC), file your final return
- Close the company bank account once funds have been distributed
The cancellation process
- Get current on the Franchise Tax: Delaware will not accept cancellation if there is outstanding Franchise Tax, including the current year’s tax
- File the Certificate of Cancellation with Delaware’s Division of Corporations, with a filing fee of approximately $200 (check the current amount at corp.delaware.gov)
- Receive confirmation: once accepted, your LLC ceases to exist and stops generating Franchise Tax
Common (and costly) mistakes
- «I’ll just stop paying and that’s that»: no. The LLC enters Void status, the debt grows with a $200 penalty plus interest, and the problem stays with your name
- Cancelling mid-year thinking you’ll save on the tax: the current year’s Franchise Tax is still owed in order to cancel
- Removing the Registered Agent before cancelling: every active LLC needs a Registered Agent. Without one, the state can declare it non-compliant — keep it in place until cancellation is filed
💡 Tip: if you’re torn between closing or keeping the LLC «just in case», do the math: maintaining it costs the Franchise Tax ($300/year) plus the Registered Agent. If you don’t expect to use it in the next 12–18 months, cancelling and setting up again when needed usually makes more sense.
Contact support before you start the closure process and we’ll guide you through it. And if you ever come back, your new LLC awaits you at startup.aiden.es.
⚖️ This guide is informational and does not substitute for professional tax or legal advice. For your specific situation, consult a qualified adviser.