Dissolving a Nonprofit in Indiana

Posted on Wednesday, May 21, 2014

In today’s challenging economy, sometimes nonprofit organizations are faced with the realization that they must close their doors.  In order to properly dissolve the organization, there are certain steps that must be followed.

1.    The board of directors must vote to dissolve the organization.

2.    Articles of Dissolution of a Domestic Nonprofit Corporation must be filed with the Indiana Secretary of State with a $30 filing fee.  A copy of the form (no payment required) must also be submitted to the Indiana Department of Revenue, Indiana Department of Workforce Development and Indiana Attorney General.  Similar to the articles of incorporation, the Indiana Secretary of State will send a certified articles of dissolution back to the organization.

3.   BC-100, Indiana Business Tax Closure Request, must be filed with the Indiana Department of Revenue along with proper documentation proving the organization has closed.  Proper documentation may include articles of dissolution, minutes of the final board of directors’ meeting, or records of bank accounts closed.

4.   If the organization is required to file Form 990, Return of Organization Exempt from Income Tax, or 990-EZ, Short Form Return of Organization Exempt from Income Tax, the box for “termination” should be checked in the header on page 1 and Schedule N, Liquidation, Termination, Dissolution, or Significant Disposition of Assets, should be completed.  In addition, a copy of the certified articles of dissolution should be attached to the return.  If the organization is required to file Form 990-N, e-Postcard, the question “Has your organization terminated or gone out of business?” should be answered “Yes.”  The final tax return is due by the 15th day of the 5th month after the end of the period for which a return is due.  (An organization with a calendar year that dissolves at the end of the calendar year must file the final return by May 15th of the year after the year in which the dissolution takes place.  If the same organization dissolves on August 31, it must file the final return on or before the 15th day of the 5th month from the date on which the termination occurs.)

5.   The “Final Report” box on form NP-20, Nonprofit Organization’s Annual Report, should be checked with the closing date indicated.

Posted by: Carrie Minnich, CPA

Posted in Mission Minded Nonprofits

Disclaimer: The information contained in Dulin, Ward & DeWald’s blog is provided for general educational purposes only and should not be construed as financial or legal advice on any subject matter. Before taking any action based on this information, we strongly encourage you to consult competent legal, accounting or other professional advice about your specific situation. Questions on blog posts may be submitted to your DWD representative.

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