Administrative Dissolution

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Administrative Dissolution Information

An **Administrative Dissolution** happens when a corporation, limited liability company (LLC), or other registered entity fails to comply with statutory obligations required to maintain its active status. Common reasons include missing annual report filings, unpaid state fees, or failure to maintain proper records or a registered office. Once dissolved, the entity loses its right to conduct business, enter into contracts, or access legal protections afforded to active entities. However, most states, including Florida, allow reinstatement after compliance is restored and penalties are paid. Administrative dissolution does not erase existing debts or liabilities; the entity remains responsible for prior obligations incurred before dissolution.

Florida Legal Definition

Under **Florida Statutes Chapter 607 (for corporations)** and **Chapter 605 (for LLCs)**, **Administrative Dissolution** is the state’s formal process of revoking an entity’s legal existence for noncompliance. The **Florida Department of State, Division of Corporations** may administratively dissolve a company if it fails to file its annual report by the third Friday of September or neglects other statutory requirements. Once dissolved, the entity’s name becomes available for use by others after one year. To regain active status, the business must apply for **reinstatement**, pay all delinquent fees, and correct the cause of dissolution. Florida law ensures this process maintains corporate accountability and upholds transparency in business operations.

How It’s Used in Practice

In practice, **Administrative Dissolution** serves as both a penalty and a compliance enforcement mechanism. For example, if a Florida LLC fails to file its annual report by the deadline, it will automatically be administratively dissolved. During dissolution, the business cannot legally operate, open new bank accounts, or pursue litigation, though it may wind up existing affairs. Many businesses seek **reinstatement** soon after dissolution by submitting required reports and paying reinstatement fees through Florida’s **Sunbiz.org** portal. Accountants, attorneys, and business owners monitor filing deadlines to prevent dissolution and the associated administrative burdens.

Key Takeaways

• **Administrative Dissolution** is the involuntary termination of a business by the state for noncompliance with filing or fee requirements.
• Once dissolved, the entity loses legal standing to conduct business or enforce contracts.
• In **Florida**, governed by **Chapters 605 and 607 of the Florida Statutes**, enforced by the **Division of Corporations**.
• Entities may be reinstated by filing overdue reports, paying penalties, and correcting compliance issues.
• Maintaining good standing through timely filings prevents costly administrative dissolutions and reinstatement processes.

Disclaimer: The information and opinions provided are for general educational, informational or entertainment purposes only and should not be construed as legal advice or a substitute for consultation with a qualified attorney. Any information that you read does not create an attorney–client relationship with Barnes Walker, Goethe, Perron, Shea & Johnson, PLLC, or any of its attorneys. Because laws, regulations, and court interpretations may change over time, the definitions and explanations provided here may not reflect the most current legal standards. The application of law varies depending on your particular facts and jurisdiction. For advice regarding your specific situation, please contact one of our Florida attorneys for personalized guidance.

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