Closing a small corporation with the IRS doesn't require an official letter that informs the agency that you're no longer doing business with that corporate name. Instead, what's involved is a series of forms covering the event like any regular tax-year filing, only with the inclusion of the liquidation amounts made from the corporate dissolution, as well as a letter the closes your employer identification number. Once the process completes, you'll have taken care of the remaining tax obligations for the corporation, with no further need to contact the IRS about the business.
Make the final federal tax deposits needed for your corporation. As a corporation, you can make your payments for convenience online, free of charge using the IRS electronic federal tax payment system (see Resources).
Prepare and file your final employment tax form: Form 940 if you file annually, or Form 941 for quarterly tax. Send this final form to your regular regional tax office, listed on the instructions of the form.
Issue W-2: Wage and Withholdings to your employees, then report the W-2 information to the IRS using a Form W-3. You'll also need to issue a final tip income, Form 8027, if your employees received any portion of their payments in the form of tips. Issue independent-contractor pay information on their pay throughout the year with a form 1099-MISC and file a Form 1096 with the IRS to report these payments.
Report any capital gains on your personal income tax using a Form 1040 or a Form 1120. Report your shareholder's share of income from the corporation during the period as well with a Form 1120S.
File the last pension or benefit plan information for your employees with a Form 5500.
Report the corporation dissolution using Form 966, or if running a small S corporation, allow the corporation election period agreed to on formation of the corporation to end naturally and file a Form 1120S.
Report the liquidation of assets using a Form 8594 and the dispensation of corporate property by filing Form 4797.
Close the employee information account number to complete the closing process with the IRS. Write a letter stating that you're closing the account due to close of business. Include the corporate name in the letter, the EIN and address of the corporation in your letter. Also include a copy of the EIN Assignment Notice if available to you. Mail it to the IRS ATTN: EO Entity, Mail Stop 6273, Ogden, UT 84201.
- Corporate books
- IRS Form 940, 941
- IRS Form W-2, W-3
- IRS Form 1099, 1099-MISC 1096
- IRS Form 1040, 1120, 1120S
- IRS Form 8594, 4797
- Employer identification number
- EIN account closing letter
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