No matter what the reason may be, closing the business that you worked hard to build is a difficult decision. However, there comes a time that a business owner realizes that the company has run its course. When the time comes, you have to be ready emotionally and mentally. You should also be aware of the things that you have to consider before finalizing the closure of the business and your LLC dissolution.
The Limited Liability Company (LLC) structure is gaining fame among startups. It is a more common way of starting a business. To form one, the owner has to go through the LLC registration process that the state implements. One has to prepare paperwork to conduct business operations formally.
Once you have finished the LLC registration, you will be able to go on with your business. It marks the start of a new chapter in your life. However, as in any other type of business, not all LLCs last forever. If that happens, the business owner has to be ready to undergo proper LLC dissolution to ensure that everything is properly concluded.
Things To Consider
Winding up a business may take months. That is why you need to come up with a plan that will protect your personal assets, credit, and reputation. Simply closing down the establishment is not enough to end your company. You will have to go through the proper dissolution process that the state has set. Additionally, you also have to make sure that the company will not have any more obligations once it formally ends.
To help you get started, we have listed a few things that you need to take care of before saying goodbye to your business.
- File LLC dissolution with the state. As stated earlier, your company submitted formal LLC registration paperwork when you formed it. Likewise, you will have to inform the state that your company will no longer be conducting business. Doing this will also let the state know that your company will no longer have filing and tax obligations.
- Inform your employees. Your people should not be kept in the dark. They have to be aware of the decision of the company because they will be affected by it too. Give them enough time to make plans. Do not tell them at the last minute. You also have to give them the assurance that they will get the right payment for the work they have done. Make sure that your company has filled all its obligations related to the employees.
- Check your taxes. Make sure the company does not have any pending tax obligations. Before closing, submit the company’s final tax forms. Clarify in the forms that it will be the last filing. Pay the corresponding tax on time.
- Close the bank accounts that are under the name of the company. After taking care of the company’s responsibilities, contact the bank. Find out the process you need to do to close accounts and credit lines. Doing this will prevent any unforeseen problems.
- Check your inventory. Determine the inventory that you currently have and come up with a plan on how you can liquidate them. You can have a closing sale. You can also look for a third party buyer that is interested in your merchandise.
- Cancel the company name. In most cases, you may not have to worry about this. Most states automatically make the company name available for others to use once the business finishes the LLC dissolution process. Check with the state to be sure.
- Resolve all financial obligations. Closing down your business means you are ready to move on. However, you must not forget about the debts that your company has incurred. To avoid encountering problems in the future, make sure you resolve all the obligations of the company.
- Keep your communication lines open. Inform all the relevant people about the closing of your business, as well as where and how they can contact you. These may include suppliers, vendors, associates, and other contacts. Closing your company does not mean you have to end your relationship with the people who have been part of the business.
Need Help With Your LLC Dissolution?
When shutting down a business, you have to make sure that you go through every step properly. If you need help in handling the dissolution process with the state, you can get the help of a team of experts. Contact DoMyLLC now for a hassle-free experience.