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Why Was My Business Entity Suspended or Forfeited, and What Are the Effects?

We suspend businesses for at least one of the following reasons:

  • Failure to file one or more tax returns.
  • Failure to pay the business' balance due. This can include the penalty for failing to file the annual Statement of Information with the Secretary of State.

Suspension or forfeiture affects a business in many ways:

  • The business loses its rights, powers, and privileges to conduct business in California.
  • The business loses the right to use its business name in California. In turn, another business could register with the suspended or forfeited business' name, and the name would then belong to the other business.
  • The business cannot initiate lawsuits, defend itself against lawsuits, or enforce its legal contracts. But other parties can enforce their terms in these contracts.
  • If the business enters contracts while suspended or forfeited, it can never enforce those contracts unless it obtains relief of contract voidability.
  • Suspensions and forfeitures are public information.
  • The business loses the right to get an extension to file a tax return.

Call us if you need assistance.

Entity type and location Telephone number
Business entities inside the U.S. 888.635.0494
Corporations outside the U.S. 916.845.7033
Limited liability companies outside the U.S. 916.845.7166
Partnerships outside the U.S. 916.845.7165