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Form 966


Edsel

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Form 966 is a transmittal-type form required when a corporation dissolves.  If a LLC, opting to file as a C corp, shuts down, is a 966 required?

There is no stock, no formal organization, and no identification with the state as a real corporation.  If a 966 is required, some of the information on the form is not relevant.

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Nowhere in the instructions, the for, or tax code 6043.1 is there any mention of an LLC, so the answer to your question I would say is definitely No.  

It seems that the form is designed for to flesh out srock transfers and even though filing 966 is required, there is no penalty for failure to do so.

I can't say how many times I've checked "Final Return" for a corp, but have yet to receive a notice from the IRS re 966.

Interestingly, 6043.1 says that "...the return shall be filed with the district director for the district in which the income tax return of the corporation is filed."  What this tells me is that the form is used to determine if an audit is appropriate.

 

 

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There's no mention of LLC in the 966 instructions because the IRS looks to how the LLC is taxed, so the answer is dependent on that.  Edsel's client is taxed as a C corp, so technically the answer would be "yes" that the 966 IS required.   However, Max is correct that there's no penalty for filing it late.   I, too, have filed final returns without ever filing a 966 and never received any further correspondence.   

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5 hours ago, Sarypion said:

I've read an article that says whether 966 is required depends on state laws.  If state law "does not require the adoption of a corporate resolution or plan of dissolution or liquidation" then 966 is not necessary.

The only problem with that is all states require corporations to file some type of form indicating that the corporation has elected to dissolve and/or has been dissolved.  Some also require a plan of dissolution.

https://eminutes.com/corporate-dissolution-and-irs-form-966-how-to-satisfy-the-plan-requirement#_ftn7

After searching various sites and reading attorneys opinions, the consensus is there is no consensus. Each has their own idea re LLC's.

I fact, Legal Zoom says LLC's have to file 966 without any mention of having filed as a corp.  Did they leave something out?  https://info.legalzoom.com/papers-file-irs-close-business-llc-4316.html

 

 

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10 hours ago, Max W said:

The only problem with that is all states require corporations to file some type of form indicating that the corporation has elected to dissolve and/or has been dissolved.  Some also require a plan of dissolution.

Unless the State's instruction specifically requires "corporate resolution", I would just file the Articles of Dissolution and forget about Form 966.  So far, I've only seen Oregon asking for coporate resolution before you can file for dissolution.

It's good that there is no penalty :)

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3 hours ago, Abby Normal said:

LLCs usually file articles of cancellation. Corporations dissolve. Almond Joys have nuts.

Really!  New York requires Articles of Dissolution; CA requires a Statement of Dissolution; TX a certificate of termination; FL the same as NY; IL same

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4 hours ago, Sarypion said:

Unless the State's instruction specifically requires "corporate resolution", I would just file the Articles of Dissolution and forget about Form 966.  So far, I've only seen Oregon asking for coporate resolution before you can file for dissolution.

It's good that there is no penalty :)

You just hedged your bet with the last sentence.

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