When you convert from an S Corporation to a single-member LLC, the liquidation process includes winding up the debts incurred in the corporation's name (if applicable) and final stock distribution. You would have to consider the distribution of any assets for tax purposes especially if you were depreciating any of the assets within the S Corp structure. You would also have to make sure that all final employment tax return and deposit requirements were made. Also, some states do have requirements to formally change business structure, but that is beyond the scope of this tax discussion.
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