DIY vs Service: How to Dissolve Your LLC

For a single-member LLC with no employees, no debt, and simple finances, the DIY path is realistic. You will spend 5-10 hours researching state requirements and filling out forms, pay a $5-$200 state filing fee, and handle the IRS EIN cancellation yourself. For anything more complex, a professional service at $99-$599 often costs less than the mistakes you make alone.

What does DIY LLC dissolution actually involve?

DIY means you handle every step: member vote, winding down operations, settling debts, filing the state dissolution form, canceling licenses, filing final tax returns, and closing the IRS EIN account. Each state has its own form, filing fee, and deadline. Some require tax clearance certificates before they accept the dissolution. Others require newspaper publication.

On average, plan for 5-10 hours of research and administrative work spread over several weeks, plus waiting 2-12 weeks for state processing.

DIY dissolution is not just filing one form. It typically involves 6-9 separate steps across multiple agencies, and each step has its own rejection criteria.

When does DIY make sense?

DIY works well when your situation is simple:

• Single-member LLC with no employees
• No outstanding debts or liabilities
• No foreign ownership (no Form 5472 requirement)
• No active state tax accounts (sales tax, payroll tax)
• No registered agent fees still owed
• All federal tax filings are current
• You have time to research your specific state's requirements

If every item on that list applies to you, grab your state's dissolution form from the Secretary of State website, pay the fee, file online or by mail, and close the EIN via IRS.gov. Total out-of-pocket: $5 in Illinois, $35 in Arizona, $25 in Florida, $200 in Massachusetts.

What are the most common DIY mistakes?

In our experience helping 15,000+ clients, the same errors repeat from DIY attempts:

1. Missing the tax clearance step. About 12 states require a tax clearance certificate from the state revenue department before the Secretary of State accepts dissolution. Skipping it delays the process by 4-8 weeks.
2. Not filing final federal returns correctly. Checking the "final return" box on Form 1065, Schedule C, or Form 1120 is easy to miss. Multi-member LLCs also need final K-1s issued to each member.
3. Leaving the EIN open. An unclosed EIN means the IRS still expects annual returns. Clients come to us years later wondering why they receive IRS notices for an LLC they thought was closed.
4. Filing in only one state. If your LLC was registered as a foreign entity in additional states, each state needs its own withdrawal filing. Forgetting one means annual fees keep accruing.
5. Skipping the registered agent cancellation. Registered agent services auto-renew. File a termination with the state and cancel the agent service directly.

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From paperwork to state filings, starting at $99.

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How much does DIY dissolution cost?

The state filing fee is your main expense. A sample of costs across states:

State	Dissolution Fee
Illinois	$5
Florida	$25
Arizona	$35
New York	$60
California	$0 (no filing fee, but $800 franchise tax if still owed)
Massachusetts	$100
Tennessee	$50
Delaware	$200

Add time spent researching (often 3-5 hours), any tax professional fees for final returns, and potential re-filing fees if your initial filing is rejected.

How much does a dissolution service cost?

Professional dissolution services range from $99 to $599 depending on what is included:

• $99 state-only: The service files Articles of Dissolution with the state, tracks the filing, and confirms the entity is officially terminated. Does not include IRS account closure or final tax returns.
• $599 complete closure: Covers both the state filing and IRS EIN cancellation, plus coordination of final tax filings. This closes the LLC fully with no open loose ends.

Neither price includes the state filing fee itself, which you pay directly to the state.

What does a service do that DIY cannot?

A dissolution service adds value in three areas where DIY struggles:

1. State-specific knowledge. Requirements change. New York overhauled its LLC dissolution rules in 2023. California has specific franchise tax clearance timing. Services track these changes; DIY filers research them once and may miss updates.
2. Rejection handling. If a filing is rejected, the service resubmits with corrections. DIY filers often do not know why a filing was rejected or how to fix it.
3. IRS coordination. Closing an EIN, filing final returns, and ensuring the IRS acknowledges dissolution involves navigating IRS.gov, Form 966, and sometimes calling the IRS directly. Services handle this as standard workflow.

Not sure where to start?

Our team walks you through every step.

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Is a service worth it for a simple single-member LLC?

For a simple LLC, DIY is fine if you have the time and patience. The math: 5-8 hours of your time at whatever you value your time at, versus $99-$599 for a service. Most people who own LLCs value their time at more than $20 per hour, which makes the service economical even on the low end.

For anything with employees, debt, multiple states, foreign ownership, or active tax accounts, a service pays for itself by avoiding compliance mistakes that generate IRS penalties and state fines.

A $25,000 Form 5472 penalty for a missed filing costs significantly more than a $599 complete closure service. Foreign owners almost always save money by using a service.

What is the right path for you?

Simple, single-member, no debt, domestic owner: DIY is reasonable. Budget $5-$200 for the state fee and 5-10 hours of your time. Anything more complex: the $99 state-only or $599 complete closure option from Dissolve My LLC handles the paperwork, tracks the filing, and closes both the state and IRS accounts without the risk of incomplete filings lingering on your record.