Understanding Pennsylvania LLC Dissolution and Winding Up Under Title 15
Starting a limited liability company (LLC) in Pennsylvania can be an exciting step for business owners. But just as important as forming your business is knowing how to properly dissolve and wind up your company if the time comes.
Under Title 15 of the Pennsylvania Consolidated Statutes, Chapter 88, Subchapter G, the law lays out the process for closing an LLC. Following these steps correctly helps protect members from future liability, ensures debts are settled, and wraps up business affairs in compliance with state law.
When Does an LLC Dissolve in Pennsylvania?
Pennsylvania law recognizes several ways an LLC can dissolve:
Voluntary Dissolution – Members may agree to dissolve under the terms of the operating agreement or, if no agreement applies, by statutory procedure.
Automatic Dissolution – Certain events, such as the expiration of a set duration in the operating agreement, can automatically trigger dissolution.
Judicial Dissolution – Courts may order dissolution when it becomes unlawful or impracticable to continue the business, or if member misconduct or disputes prevent the LLC from functioning.
The Winding Up Process
Once dissolution begins, the LLC enters a “winding up” period. The company must:
Cease Operations – Business stops, except as needed to wind up affairs.
Notify Creditors and Claimants – Known creditors and claimants must receive notice to file claims.
Settle Debts and Taxes – All debts, obligations, and taxes must be satisfied.
Distribute Assets – Remaining assets are divided according to the operating agreement or, if no agreement, according to Pennsylvania law.
Risks of Improper Dissolution
Failing to follow Title 15 procedures can create long-term problems for members, including:
Ongoing liability for unpaid debts or lawsuits
Tax issues or penalties
Continued filing obligations with the Pennsylvania Department of State
How Legal Counsel Helps
At The Skeen Firm, we guide Pennsylvania businesses through dissolution and winding up. Our services include:
Drafting dissolution resolutions and notices
Managing disputes between members
Handling creditor claims
Ensuring compliance with Title 15
If you’re looking for a Pennsylvania business law attorney to help with LLC dissolution in Pennsylvania, our team provides the guidance you need. Closing a business is never easy, but with proper legal support, you can protect your interests and move forward with confidence.
Contact us today to discuss closing a Pennsylvania LLC with an experienced attorney.
*Disclaimer: The advice provided is for informational purposes and is not intended as legal advice. It should not be relied on, nor construed as creating an attorney-client relationship.