In the second part of How to Close a Small Business in Nevada series, we take a look at the specific steps to take, and the order in which to take them.
Nevada Business License
LLC or sole proprietorship – For an LLC, send in the Certificate of Dissolution/Cancellation Limited-Liability Company found on the Nevada Secretary of State website. You will indicate the date you want to close your company. For a sole proprietorship there is a similar document. For an LLC, the dissolution form cancels both the LLC and the Nevada business license.
Go to Nevada Secretary of State - www.nvsos.gov — select “Businesses” — select “Close a Business”— select “LLC” or “Sole Proprietor”
Washoe County Business License
After your Nevada business has been closed you are ready to close Washoe County. If you are close to needing to renew your license you can opt to just wait for the renewal bill to arrive and check the box indicating the business has been closed. Otherwise, you should send a letter to the office stating that the business closed on the date you filled in on your LLC or Nevada Business License form. A letter is probably wise in either case for two reasons: for documentation; and, because another step is dependent on this license being closed.) The Washoe County office will verify that you have closed your Nevada license. Since that step may have taken a couple of weeks to process, make sure you have received paperwork from the Secretary of State to verify that the state license has been closed before contacting Washoe County.
Sales and Use Tax
Since you must file a sales and use tax form for the final month you are in business, and since filing sales tax is not done until the month following the month you are reporting, you should file in the month following your closure. Do not file this form early or it will set off red flags. After you have filed and paid any taxes due you can simply call that office or send in the close out form. Use the same closure date you used for the state. Nevada Dept of Business and Industry - Business.nv.gov — Search “Close Out Form”
Personal Property Tax (Washoe County Assessor)
This is the final step. You simply call the office and tell them you closed. They will check to see that you have already closed your Washoe County business license. You shouldn’t receive another bill. It makes no difference to them if you sell or keep your business equipment. If you do receive a letter or bill from them sometime later, do not ignore it. Contact them and clear it up.
This will just expire. No action is necessary. (I will try to verify this. Both the Washoe County Business License Office and the Assessor’s Office said I didn’t need to do anything.)
Example of a timeline:
Mary has a small business she operates. She and her husband are both owner/managers of an LLC created for this business. They have no employees and do not pay unemployment tax. Mary wants to retire. Her Nevada business license and LLC member list are valid through March 31. She selects March 30 to close her business to avoid having to renew these for $350.
In early March Mary sends in the LLC Dissolution form. Both she and John must sign the form. She uses the March 30 date of closure. She sends this in several weeks prior to the closing date so the closure will be processed before she would be required to renew licenses for another year.
In early April, Mary calls (and sends a letter to) the Washoe County business license agency and notifies them that the business closed on March 30.
Also in early April, Mary files the Sales and Use Tax form to report and pay March sales tax. She then calls that office and notifies them that the business closed on March 30 and that all taxes have been paid.
(Note: the Washoe County license and Sales and Use Tax license can be done in either order. They each depend only on the state license being closed.)
After the Washoe County license has been cancelled Mary calls the Assessor’s office to notify them the company closed on March 30. They will verify that the county business license has already closed.
Kathryn Forshey is the owner of Recognition Engraving, a small business which has served the northern Nevada casino industry since 1988. As she anticipated closing the business she encountered many questions about the process. NCET is a member-supported nonprofit organization that helps people explore business and technology. (www.NCET.org)