Canceling my EIN

[olc8]

I have a single member LLC. I already submitted my 2024 tax return. Today I am officially dissolving my LLC. I have made no profit from my business in 2025. I know I need to mail a letter to the IRS to cancel my EIN and close my business account. My question is, can I cancel it now, or do I have to wait until next year and file 2025 taxes for my LLC showing that I made no profit?

[olc8]

Follow up question:

I read that you don't have to send a letter to the IRS to cancel your EIN and that it just stays with your business forever. I also read that there is no way to indicate when it will be the final time you are filing a schedule C for a business. Does that mean I can just not file a schedule C for the year 2025 since I have no profit to report?

[TomK2023]

Yes, you should file a “final” Schedule C in the year you ceased operations (2025). This will permit you to “dispose” of any business assets you have been depreciating so TurboTax can calculate any gain or loss on the sale.  Supplies, such as paper, inventory and raw materials, do not have to be accounted for unless you deducted the costs before and sell them. 

There is no place to mark the Schedule C as final; however, you will indicate it closed  in the business info section of the Schedule C interview  in TurboTax and dispose of all assets.  See example image below (of course it will say "Did you stop... in 2025?").

For more information, see this helpful TurboTax article Closing a Business

[olc8]

Thank you! what if I don't have any business assets I have been depreciating? Do I still need to? 

[TomK2023]

Yes, you should still file a "final" Schedule C in the year you cease operations (2025).  Otherwise, the IRS may conclude that you simply didn't file your Schedule C in 2025... and send you a letter asking why and for that information.

[olc8]

Ok sounds good! I will do that. How will the IRS know that it is my final schedule C form? Why won't they then contact me in 2027 and ask why I didn't file taxes for 2026?

[DaveF1006]

The IRS doesn’t require a formal notification when closing a sole proprietorship, so there’s no specific “final” Schedule C form. Instead, you simply stop filing Schedule C when your business ceases operations and has no income or expenses for the tax year.

If the IRS doesn’t receive a Schedule C in 2026, they won’t automatically assume an issue unless there’s other taxable activity that suggests the business is still operating.