To dissolve a corporation in NJ, you need three things: authorization from the board and shareholders, a Tax Clearance Certificate from the Division of Taxation, and a Certificate of Dissolution filed with the Division of Revenue and Enterprise Services for a $75 filing fee plus a $25 tax clearance application fee. Miss any step and the corporation stays active, still owing $75 annual report fees and ongoing tax obligations.1State of New Jersey. NJ Treasury – DORES Filing Fees The IRS has its own closing filings on top of the state process, and the first one is due within 30 days of your dissolution vote.
Approve the Dissolution Internally
The board of directors adopts a resolution recommending dissolution and calls a shareholder meeting. Under NJSA 14A:12-4, the resolution passes with a majority of the votes actually cast by shareholders entitled to vote, which is not the same as a majority of all outstanding shares. A higher threshold in your certificate of incorporation controls if one exists. If any class or series votes separately, you also need a majority of the votes cast within that class.2Justia Law. New Jersey Revised Statutes Section 14A:12-4 – Dissolution by Board and Shareholders
Two shortcuts exist. If the corporation never started doing business and never issued shares, NJSA 14A:12-2 lets the incorporators or initial directors authorize dissolution through a simplified resolution, with no shareholder vote.3Justia Law. New Jersey Revised Statutes Section 14A:12-2 – Dissolution Before Commencement of Business Alternatively, under NJSA 14A:12-3, every shareholder entitled to vote may sign a unanimous written consent after receiving the same notice they would get for a meeting. If even one eligible shareholder refuses, you fall back to the vote.4State of New Jersey. C-159D Certificate of Dissolution, Without a Meeting of Shareholders
The path you take determines the form you file later. A board-and-shareholder vote uses the standard Certificate of Dissolution. A unanimous written consent uses Form C-159D, which requires you to attest that all voting shareholders signed.4State of New Jersey. C-159D Certificate of Dissolution, Without a Meeting of Shareholders Keep the signed resolution, minutes, and vote tallies in the corporate records. You’ll reference them throughout the filings.
Get the Tax Clearance Certificate
New Jersey will not process the dissolution until the Division of Taxation confirms the corporation has no outstanding state tax debts. That confirmation is the Tax Clearance Certificate required by NJSA 54:50-12, and it covers corporate business tax, employer withholding, sales and use tax, and any other state tax liabilities.
Request the certificate by submitting Form A-5088-TC with a $25 application fee payable to the State of New Jersey.5State of New Jersey. Application For Tax Clearance Certificate, Form A-5088-TC The application is part of a larger dissolution package that also includes an estimated final return (Form A-5052-TC) or a final corporate business tax return with a separate payment for any taxes owed.6New Jersey Division of Revenue. Certificate of Dissolution, Pursuant to Action of Board and Shareholders
Build in time. The form itself recommends submitting the application at least 90 days before your target dissolution date to allow for processing and follow-up requests.5State of New Jersey. Application For Tax Clearance Certificate, Form A-5088-TC Unpaid balances or unfiled returns will hold the certificate until you resolve them. Once issued, it has a limited validity window, so file the dissolution promptly after it arrives.
File the Certificate of Dissolution
With the tax clearance in hand, submit the Certificate of Dissolution to the Division of Revenue and Enterprise Services. The filing fee is $75 for a for-profit corporation.1State of New Jersey. NJ Treasury – DORES Filing Fees The state’s Online Business Endings and Cancellation service is the fastest route.7State of New Jersey. Department of the Treasury – Division of Revenue – Business Endings To file by mail, send the complete package to the New Jersey Division of Revenue, PO Box 308, Trenton, NJ 08625, Attn: Business Liquidation.6New Jersey Division of Revenue. Certificate of Dissolution, Pursuant to Action of Board and Shareholders
The form asks for the corporation’s exact legal name as filed, the ten-digit New Jersey Business Identification Number, a list of current directors and officers with their titles, and the date and place of the shareholder meeting or written consent.6New Jersey Division of Revenue. Certificate of Dissolution, Pursuant to Action of Board and Shareholders Cross-check each field against the original formation documents. Once the state processes the filing, you receive a stamped certificate or confirmation. Keep it permanently.
Handle the Federal Filings
The IRS treats dissolution as a distinct closing event, and the first deadline runs from your resolution date, not your state filing date.
Form 966 Within 30 Days
File Form 966 with the IRS within 30 days of adopting the dissolution resolution. It asks for basic corporate information, the date of the resolution, and the number of shares outstanding, and you must attach a certified copy of the resolution itself. If the plan is amended later, a new Form 966 is due within 30 days of each amendment.8Internal Revenue Service. Form 966 Corporate Dissolution or Liquidation
Final Form 1120
File a final Form 1120 by the 15th day of the fourth month after the date the corporation dissolved. Check the “Final return” box in Item E so the IRS knows to close the account.9Internal Revenue Service. Instructions for Form 1120 – U.S. Corporation Income Tax Return
Distributions to Shareholders
If the corporation distributes $600 or more in cash or property to any shareholder in the liquidation, file Form 1099-DIV for that shareholder. Cash liquidating distributions go in Box 9. Noncash distributions go in Box 10 at fair market value as of the distribution date. These are reported separately from ordinary dividends.10Internal Revenue Service. Instructions for Form 1099-DIV
Employment Taxes and the EIN
If the corporation had employees, file final employment tax returns. On the last Form 940, check “Final: Business closed or stopped paying wages” and attach a statement identifying who is keeping the payroll records and where.11Internal Revenue Service. Instructions for Form 940 – Employer’s Annual Federal Unemployment (FUTA) Tax Return Do the same on the last quarterly Form 941.
To close the Employer Identification Number, send a letter to Internal Revenue Service, Cincinnati, OH 45999, listing the corporation’s legal name, EIN, business address, and reason for closing. Include a copy of the original EIN assignment notice if you have it. The IRS will not close the account until all required returns are filed and taxes paid.12Internal Revenue Service. Closing a Business
Wind Up: Creditors and Asset Distribution
Filing the certificate does not instantly end the corporation. Under NJSA 14A:12-9, the dissolved corporation continues to exist for the purpose of winding up: collecting assets, paying debts, and distributing what remains to shareholders. It cannot conduct new business during this period.13Justia Law. New Jersey Revised Statutes Section 14A:12-9 – Effect of Dissolution
Under NJSA 14A:12-12, the corporation may give notice requiring creditors to present their claims in writing. Notice is optional but useful. Creditors who receive proper notice and miss the stated deadline can be barred from pursuing the corporation or its shareholders under NJSA 14A:12-13.14Justia Law. New Jersey Revised Statutes Section 14A:12-13 – Barring of Claims of Creditors Publishing a notice in a newspaper of general circulation helps reach unknown creditors.
Asset distribution follows a strict priority. All valid creditor claims, including amounts owed to employees, taxing authorities, and other creditors, must be satisfied before any money or property reaches shareholders. Remaining assets go to shareholders based on ownership interests and stock classes. Directors who distribute to shareholders before paying creditors in full risk personal liability for improper distributions.
Withdraw From Other States
If the corporation was authorized to do business anywhere besides New Jersey, withdraw the foreign qualification in each state. Every state has its own process, and most require a certificate or application of withdrawal filed with the Secretary of State. Many also require their own tax clearance before issuing the withdrawal certificate. Skip this step and the corporation remains registered elsewhere, still owing annual fees and franchise taxes even after the New Jersey dissolution is complete.
Keep the Records
The corporation is gone but the paper trail needs to survive. The IRS generally expects tax records to be kept for at least three years after the final return, extending to six years for substantial underreporting of income and seven years for returns with a bad debt deduction or loss from worthless securities. If no return was filed or a fraudulent return was filed, keep the records indefinitely.12Internal Revenue Service. Closing a Business Employment tax records should be retained for at least four years after the tax was due or paid, whichever is later.
Also retain the certificate of dissolution, the dissolution resolution, meeting minutes, shareholder consent forms, the tax clearance certificate, and any creditor notices for at least seven years. Designate one person as custodian, and make sure that person’s contact information is on file with the IRS and any relevant state agencies.