In the complex landscape of dissolving, surrendering, or canceling a business entity in California, the FTB Publication 1038 serves as an essential guide for navigating through the legal requirements and processes. Since September 29, 2006, a significant change was made where a tax clearance certificate was no longer necessary for several types of business entities including corporations, LLCs, LLPs, LPs, certain exempt organizations, and nonprofit corporations, aiming to streamline the process. To potentially avoid the minimum franchise or annual tax for the current and subsequent taxable years, entities must meet criteria such as timely filing their final tax returns and ceasing business operations after the last day of the preceding taxable year. Additionally, filing the correct documents with the California Secretary of State (SOS) within a specific timeframe post the filing date of the final tax return is crucial. The publication details the forms required for different entity types, addressing both domestic and foreign corporations, limited liability companies, partnerships, as well as nonprofit organizations. For entities that are suspended or forfeited, it outlines steps to regain good standing before submitting termination documents. Furthermore, the guide provides resources for filing final tax returns, especially for tax-exempt corporations, highlighting the importance of completing this step within the allowable timeframe. With additional links to forms and official guidance, as well as offering telephone and internet assistance, FTB Publication 1038 acts as a comprehensive resource for entities looking to conclude their business activities in California properly.
| Question | Answer |
|---|---|
| Form Name | Ftb 1038 Form |
| Form Length | 2 pages |
| Fillable? | No |
| Fillable fields | 0 |
| Avg. time to fill out | 30 sec |
| Other names | ftb publication 1038, ftb form 1038, ftb 1038, 1038 tax form |
STATE OF CALIFORNIA
FRANCHISE TAX BOARD
FTB Publication 1038
Guide to Dissolve,
Surrender, or
Cancel a
California
Business Entity
General Information
Effective September 29, 2006, a tax clearance certiicate is no longer required for the following entity types who intend to dissolve, surrender, or cancel their California business entity:
•Corporations
•Limited liability companies (LLCs)
•Limited liability partnerships (LLPs)
•Limited partnerships (LPs)
•Certain exempt organizations
•Nonproit corporations
Your entity may avoid the minimum franchise or annual tax for current and subsequent taxable years if you meet all of the following requirements:
•Timely ile your inal franchise or annual tax return, including extension, for the preceding taxable year.
•Conduct no business after the last day of the preceding taxable year.
•File the appropriate documents with the California Secretary of State (SOS) within 12 months of the iling date of your inal tax return.
All tax returns remain subject to audit until expiration of the normal statute of limitations. For suspended or forfeited corporations, see SIDE 2.
Forms to File with the California Secretary of State (SOS)
Domestic Stock Corporations – File one or more of the following forms:
•Certificate of Election to Wind Up and Dissolve (Form ELEC STK).
•Certificate of Dissolution (Form DISS STK).
•Short Form Certificate of Dissolution (Form DSF STK). You must meet speciic requirements to ile this form. Go to sos.ca.gov or call 916.657.5448 for more information.
Qualified Foreign and Qualified Foreign
Domestic Limited Liability Companies Organized in California – File one or more of the following forms:
•Certificate of Dissolution
•Certificate of Cancellation
•Short Form Certificate of Cancellation (LLC- 4/8). You must meet speciic requirements to ile this form. Go to sos.ca.gov or call 916.657.5448 for more information.
Foreign Limited Liability Companies – File a Limited Liability Company Certificate of Cancellation (LLC – 4/7). A foreign limited liability company is not eligible to ile the Short Form Certificate of Cancellation.
Domestic and Foreign Limited Liability Partnerships – File a Limited Liability Partnership Notice of Change of Status
Domestic and Foreign Registered Limited Liability Partnerships – File a Limited Liability Partnership Notice of Change of Status
Domestic Taxable Nonprofit Corporations and Domestic
•Certificate of Election to Wind Up and Dissolve (Form ELEC NP).
•Certificate of Dissolution (Form DISS NP).
•A Dissolution Waiver obtained from the California Ofice of the Attorney General. For information regarding the letter or approval, call 916.445.2021.
Nonqualified
FTB Pub. 1038 (REV
Suspended or Forfeited Corporations
SOS cannot accept termination documents if FTB suspended or forfeited the corporation. You must complete all of the following requirements before you submit your termination documents to SOS:
•Pay all outstanding balances due.
•File any delinquent tax returns.
•File FTB 3557 BC, Application for Certificate of Revivor, (Banks and Corporations), FTB 3557 LLC, Application for Certificate of Revivor, (LLCs), or FTB 3557 E, Application for Certificate of Revivor,
For more information regarding the revivor
Domestic Public Benefit, Religious, and Mutual Benefit Corporations
All domestic public beneit, religious, and mutual beneit corporations holding charitable assets in a trust must obtain a Dissolution Waiver from the California Ofice of the Attorney General in order to complete their dissolution. Refer to the California Ofice of the Attorney General’s publication, General Guide for Dissolving a California Nonprofit Corporation at ag.ca.gov for more information. The Dissolution Waiver must be filed with SOS along with the other required documents.
Domestic or Foreign Nonprofit
The law requires
FTB offers telephone assistance for
Forms and Publications
Get FTB forms and publications at ftb.ca.gov or SOS forms at sos.ca.gov. To get California Ofice of the Attorney General forms, call 916.445.2021.
Internet and Telephone Assistance
Website: ftb.ca.gov
Telephone: 800.852.5711 from within the United States 916.845.6500 from outside the United States
TTY/TDD: 800.822.6268 for persons with hearing or speech impairments
Asistencia Por Internet y Teléfono
Sitio web: ftb.ca.gov
Teléfono: 800.852.5711 dentro de los Estados Unidos 916.845.6500 fuera de los Estados Unidos
TTY/TDD: 800.822.6268 para personas con discapacidades auditivas y del habla
FTB Pub. 1038 (REV