Three Reasons You Need A Lawyer To Dissolve Your Business
Depending on how big it is, dissolving a company goes beyond just winding down and shutting the doors of your office. It would be best if you involved creditors, IRS, investors, and both federal and state governments. This makes it quite complicated.
In fact, the process of business dissolution is very long. Here are some of the steps involved in business dissolution.
- Close your business in line with your business article.
- File with the State.
- Inform the IRS and other tax agencies.
- Cancel all your business licenses.
- Notify your creditors
- Settle creditor claims.
- Collect money owed your business.
- Inform other stakeholders.
- Dispose of all your assets
As you can see, it is a long list of critical steps. While you don’t have to follow the steps in any order, you must carry every one of them out appropriately to avoid problems in the future.
If you run a sole proprietorship, you can close the business as you want, but if the company is a partnership with written agreements, you need to follow business closure rules as it is in your agreement. This is very important. Of course, it is more advisable to carry out every step with the guidance of a dissolution lawyer.
However, here are some reasons why hiring a dissolution attorney is not an option but a necessity.
1. To prevent problems with IRS and other tax agencies
You must set your records straight with all tax agencies and pay all your outstanding taxes before you shut down finally. Unfortunately, tax issues are always complicated. Every business is unique, and so is their tax expectation.
So, you need the services of a reputable dissolution attorney to help you out in the process. Besides, there may be ways to cut down your taxes legally, only an experienced lawyer based in the state where your business is located can help figure out these ways.
2. To settle creditor claims
This step is not usually as easy as it sounds. Remember, the likely reason you are shutting down is dwindling profits or a huge loss. What is left to share will be small (if any). The major problem is that some creditors may feel that they deserve more than the amount you are planning to give them.
Claim settlement may lead to a series of lawsuits. So, you need an attorney to navigate you through the waters of claim settlement. In fact, this is the most challenging part of business dissolution.
3. License cancellation
You need to cancel all your local, state, and federal licenses and permits. It is necessary because some other people could use your license to operate a business, and you will be responsible for their taxes. So, you must cancel or relinquish all your permits and licenses. It is even more important that you have documentary proofs that you took the step. This is why you need a dissolution lawyer.
Now that you have seen how long and tedious the process is, do you know that you can close your business down legally in only three steps? For more information, contact Click Attorney.