Voluntary LLC Dissolution and Cancellation Requirements in Texas
At a glance
| Governing law and scope | Texas BOC chapters 11 and 101; domestic ordinary LLC winds up under chapter 11 and terminates by Secretary of State certificate (Tex. Bus. Orgs. Code §§ 11.001-.358, 101.551-.552) |
|---|---|
| Dissolution event and approval | Majority vote of all members; if no members, majority vote of all managers, for voluntary winding up under chapter 11 (§ 101.552(a)(1)) |
| Pre-filing status and tax clearance | Mandatory Comptroller Form 05-305 certificate showing Title 2 taxes paid and termination good standing; must remain good through effective date. Website status printout is insufficient (§ 11.101(b); Form 651 instructions) |
| Winding-up authority and powers | Responsible owners/members/managerial officials must act as soon as reasonably practicable: stop ordinary business, notify known claimants, collect/sell property, and handle other wind-up acts; suits may continue (§ 11.052) |
| Creditor notice and claims | Written winding-up notice to each known claimant is mandatory; § 11.052 states no fixed response period in the basic procedure. Claim includes liquidated/unliquidated, accrued/contingent, matured/unmatured rights (§§ 11.001(1), 11.052(a)(2)) |
| Debts, reserves, and distributions | Discharge or adequately provide for all liabilities and obligations, including member liabilities other than distributions; only then distribute the remainder by owners' rights/interests (§ 11.053) |
| Termination filing and signer | After winding up, file Form 651 certificate of termination stating entity/governing-person details, event, and compliance; authorized manager signs a manager-managed LLC, authorized managing member signs a member-managed LLC (§ 11.101; Form 651) |
| Fee, method, and effective date | $40; Form 651 instructions state duplicate paper filing by mail or delivery. Effective on acceptance/filing unless delayed to a date/time or future event within the statutory 90-day framework (§ 11.102; Form 651 instructions) |
| Survival, revocation, and post-closure | Voluntary winding up may be revoked before termination using the LLC approval rule. Existing claims include claims arising before termination and claims arising before the third anniversary after termination, if not limitations-barred (§§ 11.001(3), 11.151) |
Requirements one by one
Texas separates the wind-up decision from termination
Tex. Bus. Orgs. Code § 11.051 identifies events that require winding up, including a voluntary decision and a governing-document event. The LLC-specific approval rule is § 101.552: a majority vote of all members, or a majority of all managers if the company has no members.
That vote begins the process. Legal existence ends later, when the Secretary of State files the certificate of termination under §§ 11.101-11.102.
A termination-specific tax certificate is mandatory
Section 11.101(b) requires a Comptroller certificate that Title 2 taxes have been paid. Form 651 identifies the correct record as Comptroller Form 05-305, and it must remain good through the filing's effective date.
A website franchise-tax status printout is not a substitute. The Secretary of State warns that the Comptroller issues several certificate types, so obtaining general good-standing evidence does not necessarily satisfy termination.
Winding up stops ordinary business
Under § 11.052, the responsible owners, members, managerial officials, or other specified persons must act as soon as reasonably practicable. The company must stop ordinary business except as necessary to wind up, collect and sell property not distributed in kind, and perform the remaining closure acts.
The company may still prosecute or defend civil, criminal, and administrative actions during winding up.
Every known claimant receives written notice
Section 11.052(a)(2) requires written winding-up notice to each known claimant. The term is broad: § 11.001 includes rights to payment, damages, or property whether liquidated or unliquidated, accrued or contingent, matured or unmatured.
The basic notice statute does not specify a universal response period. It should not be rewritten as a fixed-day claim-bar notice without a separate applicable procedure.
Liabilities come before owner distributions
Tex. Bus. Orgs. Code § 11.053 requires the LLC to discharge or adequately provide for all liabilities and obligations. If assets are insufficient, the company must apply them as far as possible to a just and equitable discharge, including obligations owed to members other than distributions.
Only after liabilities are discharged or adequately provided for may the remaining cash or property go to owners according to their rights and interests.
Form 651 is filed only after winding up is complete
The certificate of termination states the entity name, governing persons and addresses, file number, nature of the winding-up event, and that the company complied with the BOC winding-up rules. An authorized manager signs for a manager-managed LLC; an authorized managing member signs for a member-managed LLC. Notarization is not required.
The Comptroller certificate must accompany Form 651. Filing the termination before completing the wind-up process contradicts both § 11.101 and the form's required compliance statement.
The fee is $40 and delayed effectiveness is available
Form 651's current base filing fee is $40. The instructions direct duplicate paper submission by mail or delivery to the Secretary of State.
The ordinary effective time is acceptance and filing. The form also permits a specified date or time not more than 90 days after signing, or a future event or fact under the stated filing requirements.
Revocation must occur before termination
Tex. Bus. Orgs. Code § 11.151 permits the company to revoke a voluntary winding-up decision before termination takes effect, using the LLC approval rule. Once termination is effective, that pretermination revocation path has closed.
Texas nevertheless preserves an “existing claim” category. Section 11.001 includes an unbarred pretermination claim and an unbarred claim that arises after termination but before the third anniversary of termination.
What trips people up
- A tax website printout is not Form 05-305. The Secretary of State requires the termination-specific certificate of account status.
- The member vote is not the terminal filing. Winding up and the Comptroller certificate come before Form 651.
- Known claimant is broader than current creditor. It includes contingent, unmatured, and unliquidated rights.
- A delayed effective filing has a tax timing consequence. The Comptroller certificate must stay good through the effective date, not merely the delivery date.
Common questions
What member vote does a Texas LLC need?
The default is a majority vote of all members. If the LLC has no members, the default is a majority vote of all managers.
Can Form 651 be filed before winding up is complete?
No. Section 11.101 and the official instructions make completion of winding up the prerequisite for the certificate of termination.
Does Form 651 need notarization?
No. It must be signed by the correct authorized manager or managing member, but the Secretary of State instructions say notarization is unnecessary.
Statutes and sources
- Tex. Bus. Orgs. Code §§ 11.001 and 11.051-.053 — claim definitions, winding-up events and tasks, known-claimant notice, liabilities, and owner distributions. Official chapter 11 PDF (accessed 2026-07-28).
- Tex. Bus. Orgs. Code § 101.552 — majority-of-all-members approval for voluntary winding up. Official chapter 101 PDF (accessed 2026-07-28).
- Tex. Bus. Orgs. Code §§ 11.101-.102 and 11.151 — certificate of termination, tax certificate, filing effect, and pretermination revocation. Official chapter 11 PDF (accessed 2026-07-28).
- Texas Secretary of State Form 651 instructions — required contents, Form 05-305, signer, no notary, $40 fee, delivery, and delayed effectiveness. Official instructions (accessed 2026-07-28).
Source links
Every statute quoted above, linked, with the date we checked it.
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