As a quick alert of an upcoming deadline (as of blog publication) that business owners who have their business entities administrative dissolved more than five years ago, must file an application for reinstatement by July 31, 2018, in order for the application to be accepted. This deadline is coming up very soon and involves a few steps before you can submit. If you believe this may apply to your business, please contact your business attorney or Van Gorp Legal Services ASAP.
Depending on the type of business entity a business owner chooses, Indiana has historically required various basic filings in order to stay active and in good standing with the state. Some of these filings include biennial (every 2 years) reports, maintaining a registered agent, and paying business taxes (Ind. Code 23-18-10-1). If a business owner does not fulfill these requirements, the Secretary of State’s office will send a notice that the business is going to be administratively dissolved if the issues are not resolved within 60 days (Ind. Code 23-18-10-2). What such a designation means is that, as far as the state of Indiana sees it, your business may still exist but can no longer carry on its business (other than to wind up and liquidate assets) or benefit from the protections that come from being a business entity (Ind. Code 23-18-10-3). This means the business (nor its agents) can sign contracts or be protected from legal exposure from anything that goes wrong.
However, not all is lost if your business has been administrative dissolved. Indiana does allow for the Secretary of State to reinstate the business and continue on as if nothing went wrong. The owner can file for reinstatement and, if approved, “the reinstatement relates back to and takes effect as of the effective date of the administrative dissolution, and the limited liability company resumes carrying on business as if the administrative dissolution had never occurred” (Ind. Code 23-18-10-4). The bolded part is particularly important since any business actions taken while administratively dissolved would not be valid, but instead become totally fine once reinstated.
Back in 2017, Indiana enacted its largest update to the business code in the state’s history by passing the Uniform Business Organizations Act. Most of the law was meant to modernize and simplify Indiana’s business laws that were spread out and fragmented due to over a century of small changes. Some substantive changes primarily focused on making the requirements for businesses to file with the state consistent among the different business entities (looking at you, LPs and LLPs who now have to file biennial reports). The law also established a deadline for reinstatement. While before, a business could request reinstatement anytime after dissolution, the Secretary of State now only extends that opportunity for five years after the effective date of the dissolution. For businesses that are outside of this five-year window, the SOS office is allowing for a grace period until July 31, 2018, to file for reinstatement. After that, once a business passes five years beyond the effective date of the dissolution, the business cannot be reinstated and the owner must create a new business entity.
If you are not sure if your business is administratively dissolved, you can check the Indiana Secretary of State’s online portal for businesses, called INBiz. That portal is also where you can send in the application or any relevant documents related to the process. For more details of the specific steps required for reinstatement, check out this page.