REMINDER - File Your Annual Reports to Avoid Dissolution of Your Entity
If your entity is delinquent in filing its annual report, it may be subject to dissolution by the Connecticut Secretary of State.
All domestic Connecticut and foreign registered entities are required to file an annual report by the end of the entity’s month of formation/registration each year. For example, if a Connecticut corporation was formed on April 15, 2009, that corporation must file an annual report with the Connecticut Secretary of State each year by April 30.
Effective January 1, 2015, Connecticut reinstated its administrative dissolution/revocation process with regard to Connecticut entities and registered foreign entities that are delinquent in filing their annual report(s). This change was instituted to encourage entities to maintain current company information with the Secretary of State’s office. The time period within which administrative dissolution or revocation may be instituted varies by entity type. As corporations and limited liability companies (“LLCs”) are the most common form of entity, this Alert will focus on those entity types.
Connecticut statutes now provide that a Connecticut corporation or Connecticut LLC that is more than one year late in filing its annual report, may be dissolved by the Secretary of State’s office. A Connecticut non-stock corporation is subject to administrative dissolution if it is more than two years late in filing its annual report.
With regard to foreign corporations and foreign LLCs that are registered to transact business in Connecticut, the Connecticut Secretary of State is now authorized to immediately revoke the entity’s Certificate of Authority to transact business in Connecticut if the entity has simply failed to file its annual report with the Secretary of the State.
While the Secretary of State will likely initially begin enforcing these new provisions against entities that have not filed their annual reports for many years, it is important that you stay current with your annual report filings to avoid potential unintended dissolution or revocation of your entity’s authority to transact business in Connecticut, as well as to avoid any resulting disruption in business. It is also important to note that the Secretary of State will not issue a Certificate of Legal Existence to any entity that is delinquent in its annual report filings. The failure to obtain a Certificate of Legal Existence can cause delay in closing a financing or other business transaction in which a Certificate of Legal Existence is required.
If you need assistance with or have questions regarding any of the processes discussed in this article, feel free to contact us.
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