A New York State business corporation may voluntarily dissolve. By doing so, the corporation ends its obligation to pay future taxes and fees to New York State. The dissolution process involves both the Tax Department and the New York Department of State.
New York business corporations must pay franchise and other taxes to New York State. The corporation pays the taxes in exchange for the privilege of exercising its corporate franchise, doing business, employing capital, owning or leasing property, or maintaining an office in the state.
When a New York business corporation decides it will no longer conduct business in New York, it will want to be sure that it ends its obligation to pay state taxes and fees. The process of voluntary dissolution:
- brings the existence of the corporation to an end; and
- ends the corporation’s obligation to pay future state taxes and fees to New York State.