Closing a California corporation isn’t as simple as locking the doors and walking away. Whether you’re shutting down a failed startup, consolidating business entities, or moving operations out of state, you need to understand both the corporate law mechanics and the tax implications. Get it wrong, and you could face ongoing $800 annual minimum franchise tax obligations, personal liability for unpaid debts, or enforcement actions from creditors.

This guide walks through the complete process of dissolving a California stock corporation, with particular emphasis on the critical steps needed to stop the annual $800 minimum franchise tax from continuing indefinitely. I’ve handled hundreds of these transactions over 13 years of practice, and the most common mistake I see is business owners who think they’ve closed their company when they haven’t properly completed the dissolution with both the Secretary of State and the Franchise Tax Board.

If you’re dissolving a California LLC instead, the process differs significantly. This article focuses exclusively on California domestic stock corporations (including S corporations, which are corporations for state law purposes). For professional corporations, close corporations, or nonprofit corporations, some special rules may apply beyond what’s covered here.

Understanding Dissolution vs. Winding Up: What Actually Happens?

Many business owners use “dissolve” and “wind up” interchangeably, but California law treats these as distinct phases. Understanding the difference matters because your corporation continues to exist and incur obligations during the winding-up period, even after you’ve decided to dissolve.

The Election to Wind Up and Dissolve

The process starts when your board of directors and shareholders vote to dissolve the corporation. Under Corporations Code Section 1900, this requires approval by both the board and the shareholders holding a majority of the outstanding shares (or whatever higher threshold your bylaws specify). This vote creates what the statute calls an “election to wind up and dissolve.”

Once this election is made, Corporations Code Section 1901 requires the corporation to cease carrying on business except as necessary for winding up. You can’t just continue operating as normal while casually winding down. The corporation must actively work toward completing the dissolution.

There’s an important exception to the standard approval process: if your corporation never issued shares or never commenced business, the board can dissolve without shareholder approval under Section 1900.5. This “short form” dissolution process is simpler and allows you to skip straight to filing the dissolution certificate without the election certificate.

What Winding Up Actually Involves

Winding up means systematically closing out the corporation’s affairs. This includes collecting accounts receivable, selling assets, paying or providing for all debts and obligations, dealing with pending litigation, filing final tax returns, and distributing remaining assets to shareholders. Under Section 2010, the corporation continues to exist for these purposes even after dissolution.

The survival-after-dissolution rule in Section 2010 is crucial. It means your corporation can still sue or be sued, hold property, and conduct business transactions necessary to wind up its affairs. However, it cannot start new business ventures or continue operating in its original capacity. Think of it as being on life support while you settle final accounts, not as permission to keep doing business.

This period can last weeks, months, or even years depending on the complexity of your affairs. I’ve seen simple corporations with no assets or liabilities complete winding up in a few weeks, while corporations with real estate holdings, ongoing litigation, or complex contractual obligations take years to fully wind up.

The Legal Framework: Key Statutes You Need to Know

California’s dissolution process is governed primarily by Corporations Code Chapter 19 (Sections 1900-1907) for the dissolution election and procedures, and Chapter 20 (Sections 2010-2011) for post-dissolution survival and winding up. These statutes lay out specific requirements that must be satisfied before you can file dissolution documents.

Certificate of Election to Wind Up and Dissolve

Section 1902 requires most corporations to file a Certificate of Election to Wind Up and Dissolve (Form ELEC STK) with the Secretary of State after the shareholders vote to dissolve. This certificate formally notifies the state and the public that your corporation has elected to dissolve and is in the process of winding up.

However, you can skip this filing in two situations. First, if 100% of your shareholders approved the dissolution and you include a statement to that effect in your dissolution certificate, you don’t need a separate election certificate. Second, if you qualify for short-form dissolution under Section 1900.5, you can proceed directly to filing the dissolution certificate.

The election certificate doesn’t actually dissolve the corporation. It simply starts the clock and gives public notice that dissolution is underway. The actual dissolution occurs when you file the Certificate of Dissolution.

Certificate of Dissolution: The Critical Filing

Section 1905 specifies exactly what must be in your Certificate of Dissolution (Form DISS STK). This is where many dissolution attempts fail, because the statute requires you to make specific factual statements under penalty of perjury. You cannot file the dissolution certificate until these statements are actually true.

The required statements include: (1) that the election to wind up and dissolve was made by the required vote; (2) that all known debts, liabilities, and obligations of the corporation have been paid or adequately provided for; (3) that all known assets have been distributed or adequate provision has been made for distribution; (4) that no actions are pending against the corporation or adequate provision has been made for them; and (5) that the final franchise tax return has been or will be filed with the Franchise Tax Board.

These aren’t mere formalities. By signing the dissolution certificate, you’re certifying under penalty of perjury that these statements are true. If you lie and creditors come looking for money later, you could face personal liability. This is why proper winding up before filing is so important.

The Step-by-Step Dissolution Process

Here’s how to properly dissolve a California corporation from start to finish. Following these steps in order will help you avoid the most common pitfalls.

Step 1: Check for Suspensions and Forfeitures

Before you can dissolve, your corporation must be in good standing with the Franchise Tax Board. If your corporate powers have been suspended or forfeited for failure to file tax returns or pay taxes, you must revive the corporation first. The Secretary of State will reject your dissolution filing if you’re suspended or forfeited.

Check your corporate status on the Secretary of State’s business search website. If you see “suspended” or “forfeited” status, you’ll need to file all delinquent tax returns and pay all outstanding taxes, penalties, and interest before the FTB will issue a certificate to revive. Only after revival can you proceed with dissolution.

Revival can take weeks or months depending on how far behind you are and how quickly the FTB processes your filings. This is one reason why some corporations remain suspended indefinitely rather than going through formal dissolution. However, suspension doesn’t stop the annual $800 minimum franchise tax from accruing, so you’re just digging a deeper hole.

Step 2: Board Resolution and Shareholder Vote

Once you’ve confirmed good standing status, your board must adopt a resolution recommending dissolution to the shareholders. Then hold a shareholder meeting (or obtain written consents) to approve the dissolution. Document everything properly with corporate minutes showing the date, who was present, the vote tally, and the resolution text.

If all of your shareholders approve unanimously, make note of this in your corporate records. As mentioned earlier, unanimous approval allows you to skip filing the Certificate of Election and include the unanimous approval statement directly in your Certificate of Dissolution.

Step 3: File Certificate of Election (If Required)

If your shareholder approval wasn’t unanimous and you don’t qualify for short-form dissolution, file Form ELEC STK with the Secretary of State. This form requires basic information about your corporation, the date of the election, and how the vote was conducted. The filing fee is currently $30.

You can file online through the Secretary of State’s bizfile portal or by mail. Online filing is processed immediately, while mail filings can take several weeks. Filing the election certificate triggers the public notice that your corporation is winding up, which can affect contracts, credit relationships, and pending transactions.

Step 4: Complete the Winding-Up Process

Now comes the actual work of closing your business. This includes collecting any outstanding receivables, liquidating assets, paying all creditors, resolving or providing for pending litigation, canceling contracts, terminating leases, closing bank accounts, and addressing any contingent liabilities. Keep detailed records of everything you do during this phase.

For corporations with significant assets or ongoing obligations, consider setting aside a reserve fund to cover unknown or contingent liabilities. Section 1905 requires you to certify that all debts have been paid or “adequately provided for.” Creating a reserve is one way to satisfy the “adequately provided for” requirement when you can’t pay everything immediately.

Pay special attention to employment obligations. Make final wage payments, provide required notices under the WARN Act if applicable, file final employment tax returns, and handle any pending workers’ compensation claims. Employment claims are one of the most common sources of post-dissolution liability.

Once all debts are paid or provided for, distribute remaining assets to shareholders according to their ownership percentages or as provided in your articles or bylaws. Get written receipts from shareholders acknowledging receipt of distributions. These receipts protect you if questions arise later about whether assets were properly distributed.

Step 5: File Final Tax Returns

Before filing your Certificate of Dissolution with the Secretary of State, you must file your final franchise tax return with the FTB. For regular corporations, this is Form 100. For S corporations, it’s Form 100S. Check the “Final Return” box at the top of the form and in the appropriate section.

The final return covers the short tax year from the beginning of your tax year through the date of dissolution. Even if this period is less than 12 months, you still owe the $800 minimum franchise tax for that tax year unless you qualify for an exemption (more on exemptions in the tax section below).

Don’t forget federal tax returns. File a final Form 1120 or 1120-S with the IRS, checking the final return box. If you’re an S corporation, you’ll also need to provide final Schedule K-1s to all shareholders reporting their share of income, deductions, and distributions for the final year.

File all employment tax returns as well. This includes your final Form 941 for federal payroll taxes, California Form DE-9 for state payroll taxes, and any required year-end forms like W-2s and 1099s. The sooner you file these, the sooner you can close your payroll tax accounts.

Step 6: File Certificate of Dissolution

Only after completing winding up and filing final tax returns should you file Form DISS STK with the Secretary of State. The form requires you to certify under penalty of perjury that all the winding-up requirements have been satisfied. As mentioned earlier, making false statements here can create personal liability.

The critical requirement from a tax perspective is that you must file the dissolution certificate within 12 months of filing your final tax return with the FTB. If you miss this deadline, the FTB may continue to assess the $800 annual minimum franchise tax. This 12-month rule is strictly enforced, so don’t delay filing once your winding up is complete.

The dissolution filing fee is $30 if filed online or by mail. Processing is immediate for online filings. Once the Secretary of State accepts your filing, your corporation’s existence officially ceases, subject to the survival provisions in Section 2010 for winding up any remaining matters.

Tax Considerations: Stopping the $800 Annual Franchise Tax

For many California corporations, the driving force behind dissolution is stopping the $800 annual minimum franchise tax. However, simply filing dissolution paperwork with the Secretary of State isn’t enough. You must satisfy both the corporate law requirements and the tax law requirements to actually stop owing the $800.

Understanding the Minimum Franchise Tax

Under Revenue and Taxation Code Section 23153, every corporation incorporated, qualified, or registered in California owes a minimum annual franchise tax of $800 for each tax year it is doing business in California. This applies regardless of whether the corporation has any income, conducts any business activity, or even has any assets.

The tax is assessed based on the corporation’s existence, not its activity. As long as your corporate charter exists with the Secretary of State, you owe the tax. This is why proper dissolution is essential – it’s the only way to end your corporation’s existence and stop the annual tax obligation.

The FTB’s position is clear: the minimum franchise tax continues to accrue every year until you file both a final tax return and the required Secretary of State dissolution documents. FTB Publication 1060 states explicitly that failure to properly close your corporation means “the requirement to file tax returns and pay at least the minimum tax can continue indefinitely.” I’ve seen corporations rack up tens of thousands of dollars in accumulated minimum tax and penalties over the years because owners didn’t realize they needed to formally dissolve.

The 12-Month Rule

Here’s the rule that trips up most people: you must file your Certificate of Dissolution with the Secretary of State within 12 months of filing your final franchise tax return with the FTB. This is stated in FTB Publication 1038 and multiple FTB guidance documents. Miss this deadline, and the FTB may continue assessing the $800 minimum tax for subsequent years.

The rule creates a coordination requirement between the corporate law dissolution and the tax dissolution. You can’t just file with the Secretary of State and call it done. You must file the final tax return first, then file the dissolution certificate within 12 months. Both steps are mandatory to stop the tax obligation.

In practice, this means you should plan your dissolution timeline carefully. File your final tax return as soon as your final tax year closes, then complete winding up and file the dissolution certificate well within the 12-month window. Don’t wait until month 11 to discover you haven’t finished winding up.

Short Tax Years and Timing Strategy

California corporations pay franchise tax on a tax year basis, not a pro-rata basis. This means if you dissolve mid-year, you still owe the full $800 for that short tax year. There’s no daily proration or monthly reduction. The tax year is the unit of assessment, and any tax year in which the corporation exists triggers the minimum tax.

This creates an opportunity for timing strategy. If you’re going to dissolve anyway, consider the timing relative to your tax year. A corporation that dissolves on January 5 owes the full $800 for that year. A corporation that dissolves on December 30 also owes the full $800 for that year. From a minimum tax perspective, there’s no difference between dissolving early or late in your tax year.

However, there is one important exception for very short tax years. FTB Publication 1060 states that if your first tax year is 15 days or less and the corporation does no business during that period, this short period is not considered a taxable year and no minimum tax is due. This rule doesn’t help with dissolution (since you presumably did business before deciding to dissolve), but it’s worth knowing for formation timing.

The practical takeaway: if you’re dissolving near year-end, you might want to complete the dissolution before December 31 to avoid owing another $800 for the next tax year. But if you’re early in the year, you’re already committed to paying the $800 for that year, so you might as well take the time to properly wind up rather than rushing and potentially missing something important.

First-Year Tax Exemption

New corporations enjoy a first-year exemption from the $800 minimum franchise tax. However, this exemption only applies to the first taxable year, and it doesn’t help you avoid the tax in later years or in your dissolution year. I mention it here because some business owners mistakenly think they can avoid the dissolution-year minimum tax by invoking the first-year exemption. That’s not how it works.

The first-year exemption is relevant only if you’re dissolving a corporation that never really operated and you’re doing so in its first taxable year. Even then, you’d need to carefully review FTB Publication 1060 to determine if you truly qualify for the exemption based on when you formed, when you commenced business, and when you’re dissolving.

Administrative Dissolution and Tax Abatement

For corporations that never conducted business or ceased business years ago and have no assets, California offers an administrative dissolution program with potential tax abatement. This joint program between the Secretary of State and the FTB allows qualifying defunct entities to be terminated administratively with partial or full abatement of back taxes and penalties.

To qualify, your corporation generally must have been suspended or forfeited for failure to file returns, had no assets or business activity for several years, and meet other specific criteria. You apply to the FTB first for abatement consideration. If approved, the FTB issues authorization to file dissolution documents with the Secretary of State.

This program is useful for abandoned shell corporations where the cost of revival and normal dissolution would exceed any benefit. However, it’s not a quick fix and requires proving to the FTB that your corporation truly qualifies. If you think this might apply to your situation, review the FTB’s administrative dissolution guidance carefully or consult with a tax professional.

Timeline and Strategic Planning

Dissolution rarely happens overnight. Between the winding-up work, the tax filings, and the Secretary of State paperwork, you should expect the process to take at least several weeks for even the simplest corporations. Complex entities can take months or years.

Typical Timeline for Simple Dissolution

For a small corporation with minimal assets, no ongoing litigation, and no complicated contractual obligations, here’s a realistic timeline. Week 1: Board resolution and shareholder vote. Week 2-4: Wind up operations, pay creditors, distribute assets, collect final receivables. Week 4-6: Prepare and file final tax returns with FTB and IRS. Week 6-8: Receive final tax clearance, file Certificate of Dissolution with Secretary of State.

This assumes everything goes smoothly, all creditors are known and paid, and you have no complications. In reality, most dissolutions take longer because unexpected issues arise, creditors dispute amounts owed, tax preparation takes time, or winding up reveals additional obligations that need to be addressed.

Planning for Complex Situations

Corporations with real property, intellectual property, pending litigation, long-term contracts, or significant debt need much more time. Real estate must be sold or transferred, which involves title work, escrow, and possibly lender approval. Intellectual property may need to be assigned to successors or licensing arrangements may need to be terminated or transferred.

Pending litigation is particularly problematic. You can’t make the required statement in your dissolution certificate that no actions are pending unless you’ve actually resolved or adequately provided for all litigation. This might mean settling cases, obtaining dismissals, posting bonds, or creating reserves. Some litigation can drag on for years, which means your corporation stays in existence for years.

Long-term contracts need special attention. You’ll need to review each contract to determine your termination rights and obligations. Some contracts may require you to pay termination fees. Others may prohibit early termination without consent. And some may automatically terminate on dissolution while leaving residual obligations. Address these issues systematically during winding up rather than discovering them after filing dissolution documents.

The Year-End Timing Decision

As discussed in the tax section, there’s no pro-rata reduction of the $800 minimum franchise tax for short years. This means timing your dissolution relative to your tax year-end can save you $800 but requires strategic planning.

If you’re in October or November and considering dissolution, can you complete everything before December 31? If yes, you’ll avoid owing another $800 for the next tax year. If no, you might be better off accepting that you’ll pay the next year’s $800 and taking the time to properly wind up rather than rushing and making mistakes.

Remember the 12-month rule: you must file the dissolution certificate within 12 months of your final tax return. So if your tax year ends December 31, 2024, and you file your final tax return in April 2025, you have until April 2026 to file the dissolution certificate. This gives you time to complete winding up without losing the ability to stop future minimum taxes.

Common Pitfalls and How to Avoid Them

After handling hundreds of corporate dissolutions, I’ve seen the same mistakes repeatedly. Here are the most common problems and how to avoid them.

Filing Dissolution Without Completing Winding Up

The single most common mistake is filing the Certificate of Dissolution before actually completing the winding-up process. Business owners see the dissolution certificate as the finish line, when it’s actually a certification that you’ve already finished winding up.

Remember, the dissolution certificate requires you to certify under penalty of perjury that all debts have been paid or provided for, all assets have been distributed, and no litigation is pending. If these statements aren’t true when you file, you’re committing perjury and potentially exposing yourself to personal liability.

Take the time to actually finish winding up before filing. Pay or resolve all debts. Distribute all assets. Handle all litigation. File all tax returns. Then and only then should you file the dissolution certificate. The Secretary of State doesn’t verify your statements, but that doesn’t make false statements legal or consequence-free.

Missing the 12-Month Filing Deadline

The 12-month deadline between filing your final tax return and filing your dissolution certificate is strictly enforced by the FTB. Miss this deadline, and the FTB may continue assessing the $800 annual minimum franchise tax indefinitely.

The problem often arises when corporations file their final tax return and then get distracted by other priorities. Months pass. The winding-up process drags on. Before you know it, 18 months have gone by and you’ve missed the window. Now you’re still on the hook for ongoing minimum taxes even though you thought you were dissolved.

Set a reminder immediately after filing your final tax return. Put the deadline on your calendar. Better yet, aim to file the dissolution certificate within 6 months rather than waiting until the last minute. This gives you buffer room for unexpected delays.

Forgetting About Suspended or Forfeited Status

Corporations suspended or forfeited by the FTB for unpaid taxes cannot dissolve until they revive. The Secretary of State will reject your dissolution filing if your status shows suspended or forfeited. Yet many business owners don’t check their status before starting the dissolution process.

Always check your corporation’s status on the Secretary of State website before beginning dissolution. If you’re suspended or forfeited, budget extra time and money for revival. You’ll need to file all delinquent returns and pay all back taxes, penalties, and interest before you can proceed with dissolution. This can add weeks or months to your timeline and thousands of dollars to your costs.

Ignoring Shareholder Distribution Requirements

After paying all creditors, remaining assets must be distributed to shareholders according to their ownership interests or as provided in the articles or bylaws. Some business owners skip this step, thinking they can deal with remaining assets informally after dissolution.

This creates two problems. First, you can’t truthfully certify in your dissolution certificate that all assets have been distributed if you haven’t actually distributed them. Second, distributing assets after dissolution is legally complicated because the corporation no longer exists except for limited winding-up purposes.

Complete all shareholder distributions before filing the dissolution certificate. Get written receipts from shareholders acknowledging what they received. Document everything in your corporate records. This protects you from later disputes about who got what and whether distributions were proper.

Not Planning for Contingent Liabilities

Some liabilities aren’t fixed and certain at the time of dissolution. Product liability claims might arise years after you stop operating. Contract disputes might surface after dissolution. Environmental claims might emerge when contamination is discovered later.

The dissolution certificate requires you to certify that all debts and obligations have been paid or adequately provided for. The “adequately provided for” language gives you flexibility to address contingent liabilities by setting aside reserves, obtaining insurance, or making other arrangements to cover potential future claims.

Think carefully about what contingent liabilities your business might face. Consult with legal counsel about appropriate reserves or other protective measures. Better to over-prepare for contingencies than to dissolve and face personal liability when claims materialize.

Frequently Asked Questions

Can I dissolve a corporation that has outstanding debts?

Technically yes, but not until you’ve paid those debts or made adequate provision for them. The Certificate of Dissolution requires you to certify that all debts have been paid or adequately provided for. “Adequately provided for” means you’ve set aside sufficient funds to pay the debts, arranged for another party to assume the obligations, or obtained creditor consent to alternative payment arrangements. You cannot simply dissolve and walk away from unpaid debts – that would make your dissolution certificate perjurious and potentially expose directors and officers to personal liability.

If your corporation is insolvent and cannot pay all its debts, you may need to consider bankruptcy instead of or before dissolution. Bankruptcy provides legal protections for handling insolvency that voluntary dissolution does not. Consult with a bankruptcy attorney if your debts exceed your assets.

What happens if I just stop filing tax returns and let the corporation go suspended?

This is unfortunately common but creates serious problems. When you stop filing returns and paying the minimum franchise tax, the FTB will eventually suspend your corporate powers. However, suspension doesn’t end the corporation’s existence or stop the annual $800 minimum franchise tax from accruing. The tax continues year after year, along with penalties and interest on unpaid amounts.

After enough years, the accumulated tax debt can reach tens of thousands of dollars. The FTB has collection powers including liens, levies, and wage garnishments. They can also pierce the corporate veil and hold you personally liable for trust fund taxes like payroll withholding. And a suspended corporation cannot defend lawsuits, enter contracts, or conduct most business transactions.

The correct approach is to formally dissolve the corporation if you’re not using it. Yes, you’ll need to pay any back taxes to revive first if you’re already suspended. But paying a few years of back taxes now is better than accumulating decades of liability. And if you truly have no assets and never conducted business, look into the FTB’s administrative dissolution program for potential tax abatement.

Do I need a lawyer to dissolve my California corporation?

Not legally required, but highly advisable in many situations. Simple corporations with no assets, no debts, no ongoing contracts, and no litigation can often handle dissolution without legal assistance. The forms are publicly available, and the Secretary of State provides instructions.

However, you should consult an attorney if your corporation has significant assets to distribute, unpaid debts or liabilities, real estate or intellectual property, pending or threatened litigation, complex contracts, multiple shareholders with potential disputes, employment issues, tax problems beyond simple minimum franchise tax, or any situation where directors or officers might face personal liability exposure.

An attorney can help you avoid the common pitfalls discussed in this article, properly structure asset distributions, handle creditor claims, address shareholder disputes, coordinate the tax and corporate law requirements, and protect you from personal liability. The cost of legal assistance is usually far less than the cost of fixing problems that arise from improper dissolution.

How long does the corporation continue to exist after filing the dissolution certificate?

Under Corporations Code Section 2010, the corporation continues to exist after dissolution for the sole purpose of winding up its affairs. This survival period has no fixed duration – it lasts as long as necessary to complete winding up. For most corporations, this means the entity effectively ceases to exist upon filing the dissolution certificate because winding up was completed before filing.

However, if any matters remain unresolved after filing the dissolution certificate, the corporation continues to exist for purposes of addressing those matters. This might include defending lawsuits filed after dissolution, collecting receivables that come in later, or distributing assets that were overlooked. The corporation can sue and be sued during this survival period, hold property, and conduct transactions necessary to wind up. What it cannot do is resume normal business operations or start new ventures.

Can shareholders be held liable for corporate debts after dissolution?

Generally no, if the dissolution was conducted properly. The corporate form normally shields shareholders from personal liability for corporate debts both before and after dissolution. However, there are important exceptions that can create shareholder liability post-dissolution.

First, if the corporation made distributions to shareholders before paying all creditors, those shareholders may be liable to return the distributed funds to the extent necessary to pay unpaid creditors. This is why proper winding up requires paying or providing for all debts before distributing assets to shareholders.

Second, if directors or officers made fraudulent statements in the dissolution certificate (such as falsely certifying that all debts were paid), they may face personal liability for unpaid debts. This liability extends to shareholders who participated in or authorized the fraudulent certification.

Third, if creditors can pierce the corporate veil based on commingling funds, undercapitalization, or other factors, they may reach shareholders personally. Dissolution doesn’t cure veil-piercing issues that existed before dissolution. And finally, shareholders remain personally liable for any debts they personally guaranteed, as guarantees are separate obligations independent of the corporation.

What if I want to dissolve a corporation that has shareholders I can’t locate?

Missing or unresponsive shareholders complicate dissolution because you need shareholder approval under Section 1900. If you can’t get the required vote because shareholders are unreachable, you have several options depending on your situation.

For corporations with minimal activity and assets, you might qualify for court-supervised dissolution under Corporations Code Sections 1800-1806. These provisions allow involuntary dissolution in various circumstances including deadlock, illegal conduct, or when dissolution is beneficial to shareholders.

Alternatively, if your corporate records show you’ve made reasonable efforts to contact missing shareholders at their last known addresses and you have a majority or supermajority of the shares that you can contact, you may be able to proceed with dissolution. Keep detailed records of your efforts to contact missing shareholders, including certified mail receipts showing you attempted to reach them at their last known addresses from corporate records.

For any remaining assets that would have gone to missing shareholders, you’ll need to comply with California’s unclaimed property laws by reporting and remitting those funds to the State Controller’s Unclaimed Property Division. This protects you from claims by shareholders who later surface demanding their share of distributions.

Can a dissolved corporation be revived?

Yes, but the process is complex and must occur within five years of dissolution under Corporations Code Section 2010. After that five-year period, revival is generally not possible. Revival requires court approval and a showing of good cause, such as discovering assets that should have been distributed, addressing litigation that arose after dissolution, or correcting errors in the original dissolution.

Revival is different from reviving a suspended or forfeited corporation. Suspension/forfeiture revival involves paying back taxes and fees to restore corporate powers. Dissolution revival involves a court proceeding to bring back to existence a corporation that legally ceased to exist. Both are possible but involve different procedures and requirements.

Taking Action: Schedule a Consultation

Properly dissolving a California corporation requires careful attention to both corporate law and tax requirements. Miss a step, and you could face ongoing $800 annual minimum franchise tax obligations, personal liability for corporate debts, or complications with creditors and shareholders.

If you’re considering dissolving your California corporation and want to ensure it’s done correctly, I can help. As a California-licensed attorney with over 14 years of experience handling corporate dissolutions and business transactions, I work with businesses throughout California and internationally to properly close entities and minimize tax obligations.

Services I provide:

• Review of your specific situation to determine the most efficient dissolution path
• Preparation and filing of all required Secretary of State and FTB documents
• Guidance on winding-up requirements and asset distributions

Schedule a 30-minute consultation to discuss your dissolution needs.