GoDaddy defederation steps: the complete checklist

Prerequisites

• Global Admin Creds: Ensure you have the "NETORG..." admin account credentials (found in GoDaddy Advanced Settings).
• DNS Access: Verify you can edit nameservers at your domain registrar.
• Billing Method: Have a credit card or CSP relationship ready for direct Microsoft billing.

Phase 1: Preparation (No Downtime)

• Audit Users: Export active user list. Note who has MFA enabled (it will break).
• Purchase Licenses: Buy the equivalent licenses (Business Standard, Basic, etc.) in the tenant directly from Microsoft. Do not assign them yet.
• Communicate: Tell users that their password WILL change. GoDaddy does not sync password hashes, so the "Defederation" resets everyone.

Phase 2: The Cutover (Weekend Recommended)

• Execute Defederation: Run the PowerShell Remove-MsolDomainFederation command against your domain.
• Reset Passwords: Immediately set new temporary passwords for all users.
• Cancel GoDaddy Subs: Log into GoDaddy and cancel the productivity subscription (careful not to cancel the domain registration!).
• Assign Native Licenses: Assign the new Microsoft direct licenses to users.

Phase 3: Post-Migration

• Update Outlook: Users must re-enter their new password in Outlook/Teams/Mobile.
• Takeover DNS: Change nameservers from GoDaddy's specialized ones to standard Azure DNS or Cloudflare.
• Enable Security: Now that you are native, turn on Security Defaults or Conditional Access immediately.