How to Dissolve an LLC in Vermont: Complete 2026 Guide

How to Form an LLC: Step-by-Step

1. 1

   Vote to Dissolve

   Your operating agreement governs how a Vermont LLC authorizes its own wind-up. It normally sets the voting threshold, who may call the vote, and whether written consent can replace a meeting, so read it before you do anything else. If the agreement says nothing about dissolution, the default rules in Vermont's LLC act supply the standard, and the safe move is to confirm what that standard is rather than assume a simple majority carries. Record the outcome in writing: the date, the members who consented, the interests they hold, and a clear statement that dissolution was authorized. Single-member LLCs need this record too. It is the authorization behind every filing and account closure that follows.

   Pro tip: Date the written consent before you start cancelling contracts and accounts. Counterparties ask when the decision was made, and a consent signed after the closures already happened is hard to explain.
2. 2

   File Articles of Termination with the Vermont Secretary of State

   The Vermont Secretary of State fee schedule lists LLC Articles of Termination under 11 V.S.A. 4105 at $20.00, and a Statement of Dissolution under 11 V.S.A. 3275 at $20.00 as well, so the state filing fee is $20 either way. File through the Vermont Online Business Service Center from the Secretary of State's end business registration page at https://sos.vermont.gov/business-services/business-filings/end-business-registration; the Secretary of State's own guidance says online filing is the preferred method. Vermont does not publish a standard processing turnaround for the filing, so treat the timeline as variable rather than planning a hard closing date around it.

   Pro tip: Filing online gives you a timestamped submission record immediately. If a bank or landlord needs proof before the state record updates, that receipt is what you send in the meantime.
3. 3

   Notify Creditors and Settle Debts

   Vermont's statute names a 120-day period. Under 11 V.S.A. 4107, known claims against a dissolved LLC are barred if they are not received by a deadline that may not be less than 120 days after the claimant receives written notice. Our verified data does not establish whether Vermont expects that window to run before you file the termination or alongside the wind-up, so if your timing is tight, confirm the sequencing with the Secretary of State rather than guessing. What is not in doubt: send written notice to every known creditor, keep proof of what each one received and when, and pay or provide for every obligation before any money reaches members. Vermont does not require newspaper publication of a dissolution notice.

   Pro tip: Track the 120-day count per creditor, not as one shared date, because the statute measures it from when each claimant receives its notice.
4. 4

   Close Vermont State Tax Accounts

   File a final return for every Vermont tax your LLC was registered for. For most small companies that means the state income or pass-through filing, sales and use tax if you collected it, meals and rooms tax if it applied to your business, and withholding if you had employees. Mark each return final and use the correct short final period rather than a full year you did not operate, then close the underlying registrations so the state stops expecting returns. Vermont does not require a tax clearance certificate to terminate the LLC, so do not treat a clearance letter as a precondition for filing. Closing the accounts still matters, because an open registration keeps generating notices for a business that no longer exists.

   Pro tip: Save the confirmation for each account you close. Reconstructing which registrations were shut down, and when, is far harder a year later than saving one PDF now.
5. 5

   Deactivate Your EIN with the IRS

   The IRS cannot cancel an EIN, but it can deactivate it once any outstanding returns are filed and taxes owed are paid. See the FAQ below for the letter and mailing addresses. File your final federal return before or alongside the deactivation letter: Form 1065 for a multi-member LLC, Form 1120-S if you elected S corporation treatment or Form 1120 if you elected C corporation treatment, each with the final return box checked, or the appropriate schedule on a member's personal return for a single-member LLC. An LLC taxed as a corporation also files Form 966.

   Pro tip: Send the deactivation letter certified and file the receipt with your dissolution records.
6. 6

   Distribute Remaining Assets to Members

   Distributions come last, and the sequence is what protects you. Pay or provide for creditors and other liabilities first, including obligations you can reasonably foresee such as a disputed invoice, a warranty claim, or a final professional fee. Whatever remains goes to members, allocated as the operating agreement directs and by ownership percentage if it is silent. Paying members while a known debt is outstanding is the most common route to personal exposure after an LLC closes. Appraise or otherwise value non-cash property before transferring it, log who received what on which date, and have each member sign for the distribution. Members report their own gain, and those records are what their accountants will ask for.

   Pro tip: Keep a reserve for the tail end: the last utility bill, the final accounting fee, the return not yet filed. Asking members to return money is far worse than holding a little back.
7. 7

   Confirm Dissolution is Complete

   Look your LLC up in the Vermont Secretary of State's business search and confirm the record reflects the filing. Until the public record changes, treat the termination as pending rather than final. Order a certified copy of the filed document, because banks, landlords, insurers, and payment processors generally want state-issued proof rather than your own printout. Then build one permanent file containing the written member consent, the filed termination and its certified copy, creditor notices with delivery proof, final federal and Vermont returns, tax account closure confirmations, and the distribution records. That file is what answers a question from a creditor, an auditor, or a former member years after the business is gone.

   Pro tip: Keep the archive somewhere that survives the company email and domain. Records that live only in a business inbox disappear the month the domain lapses.

Winding-Up Checklist

• Cancel all Vermont business licenses and permits

  Town and city licenses, professional registrations, and any health or liquor permits renew on their own schedules and keep billing after the state filing clears. Cancel each with the office that issued it and get confirmation in writing.

• Close business bank accounts

  Close only after every check clears, card authorizations settle, and recurring debits are cancelled, and bring a copy of the filed termination. An account left open invites deposits into an entity that no longer exists.

• Cancel business insurance policies

  Give the carrier a written dissolution date and ask about unearned premium refunds. Ask specifically whether tail coverage makes sense for claims that could be reported after the policy ends.

• Notify vendors, suppliers, and customers in writing

  A short notice with the effective date stops new orders, ends auto-renewing subscriptions, and tells customers where to send final questions. Keep a copy of every notice with your wind-up file.

• File final payroll tax returns and W-2s (if you had employees)

  File the final federal and Vermont payroll returns, issue W-2s to employees and 1099s to contractors, and close the state withholding and unemployment insurance accounts. Payroll registrations generate penalties faster than any other account you leave open.

• Retain business records per Vermont retention requirements

  Hold formation documents, the operating agreement, member consents, tax returns, and dissolution paperwork for at least seven years, which covers the usual federal and state audit windows. Keep a second copy off site.