Exiting a startup can be expensive—unless you planned your entity right from the start. Wyoming’s Close LLC statute provides founders with a simplified structure for managing, operating, and even dissolving their business—without court intervention or complex member voting. In 2025, it remains one of the cheapest and cleanest exit strategies available in the U.S.
Here’s how it works and when you should use it.
Relevant IRC Codes & Definitions
While the Wyoming Close LLC statute is governed by state law (W.S. §17-25-101 to 109), the following federal codes also apply upon dissolution:
- IRC §331 – Treatment of liquidating distributions for LLCs taxed as corporations.
- IRC §708 – Addresses termination of partnerships (multi-member LLCs) for federal tax purposes.
- IRC §165 – Allows for the deduction of capital losses upon liquidation.
- IRC §1001 – Determines gain or loss on the sale or disposition of property upon entity closure.
Dissolving a Close LLC may trigger capital gains/losses, requiring accurate IRS reporting.
IRS & State Form References
Federal Tax Forms:
- Form 1065 Final (for partnerships)
- Form 1120 Final (for corporations)
- Form 966 (for corporate dissolutions, if elected C Corp status)
- Form 4797 or Schedule D (for gain/loss recognition on liquidation)
Wyoming Requirements:
- Close LLC status must be elected during formation
- Requires no Operating Agreement, no formal votes
- Articles of Dissolution (filed with the Secretary of State)
- File final Annual Report and pay $60 license tax if due
Real-World Example
Scenario:
QuantEdge LLC was formed as a Wyoming Close LLC by two technical co-founders who parted ways after their AI tool failed to reach MVP.
Because they formed under the Close LLC statute, they:
- Dissolved the company without court approval
- Did not require third-party votes or legal mediation
- Avoided writing and enforcing a formal operating agreement
- Filed final tax returns and walked away cleanly
Savings: Thousands in legal fees and months of procedural delays.
Step-by-Step Guide to Use Wyoming’s Close LLC as an Exit Strategy
- Ensure your LLC was formed as a Close LLC during initial registration.
- Verify all debts are paid, and remaining assets have been distributed.
- Close all bank accounts, payroll systems, and subscriptions.
- File IRS final returns (1065/1120) with “Final Return” checked.
- Complete and submit the Articles of Dissolution to the state.
- Retain tax records for 7 years in case of audits.
- File BOI final disclosure, if required, per FinCEN reporting rules.
Conclusion
The Close LLC is Wyoming’s best-kept secret for founders planning fast exits or winding down post-MVP failures. With no rigid voting rules, minimal paperwork, and full IRS recognition, it’s a smart choice for agile entrepreneurs who want maximum flexibility—and minimal cost—when it’s time to close shop.
Call to Action
Planning your exit? Whether shutting down or pivoting, you need to do it the tax-smart way.
Anshul Goyal, CPA EA FCA, is a U.S.-licensed Certified Public Accountant, Enrolled Agent before the IRS, and Chartered Accountant in India. He advises founders on entity formation, IRS filings, and efficient wind-down procedures.
👉 Schedule a session now with Anshul Goyal, CPA to legally dissolve your entity and file your final IRS returns while staying compliant.
Disclaimer
This blog is provided for informational and educational purposes only. It is not intended as a substitute for personalized legal, tax, or financial advice. The content herein does not establish a client-accountant relationship and should not be relied upon to make business, tax, or legal decisions without consulting a qualified professional.
FAQs (Top 5 High-Searched)
Q1. What is a Close LLC in Wyoming?
A1. A simplified LLC that doesn’t require a formal operating agreement, ideal for closely held companies and solo founders.
Q2. Can I dissolve a Close LLC without court involvement?
A2. Yes. Close LLCs can be dissolved with minimal formality, no court filings, and no mandatory member voting.
Q3. Is a Close LLC treated differently for tax purposes?
A3. No. IRS treatment depends on your federal tax election, not Close LLC status.
Q4. What forms do I file when dissolving a Close LLC?
A4. Final federal tax return (1065/1120), Articles of Dissolution, and possibly Form 966 or BOI disclosure.
Q5. Can I convert a regular LLC to a Close LLC?
A5. No. The election must be made during formation. Otherwise, you must dissolve and re-form.
About Our CPA
Anshul Goyal, CPA EA FCA, is a seasoned U.S. Certified Public Accountant, IRS Enrolled Agent, and Chartered Accountant (India). With over 2,000 startup clients, he’s helped founders launch, scale, and exit their businesses with full compliance and minimal tax exposure. Anshul specializes in entity structuring, liquidation strategies, and IRS audit representation.