Business Dissolution – Closing a California Business Properly
Getting Out of Business
Closing down your business may be a reality you face in these tough economic times. Dissolving your business can either mean you voluntarily decide to shut down your business or you are ordered to do so by a court order.
No matter whether your entity is a corporation, a partnership or an LLC, it is always smart to secure the assistance of a Business Lawyer to protect you against continued liability once your Business is shut down. If not done properly, there are significant liablities that you may be opening yourself up to.
Why do Businesses Close?
The reasons are commonly similar: a Business dissolution may be a wholly voluntary matter because you decide to retire. In other cases, issues and pressures outside of the control of Business Owners, Partners or Investors can lead to the end of an entity: by choice to limit ongoing liability. Other reasons can be because of internal disputes, economic pressures, lawsuits or the possibility of future legal action. No matter the reasons for shutting down your Business operations, you can retain some control over the Business closing by retaining an experienced Business Lawyer.
Protect Yourself – Close your Business Properly
Properly dissolving your Business will protect you from personal liability for the debts your business and/or future judgments against your business. These dissolution requirements are overseen by State statutes and may differ somewhat depending on the type of business you are dissolving. An experience Business Lawyer can guide you through the dissolution process.
How are Businesses Properly Closed?
Some of the steps typically taken when dissolving your Business include finishing existing contracts and refraining from taking on any new work. Another important step is to pay off all outstanding debts and place the money in a reserve fund to cover any known but un-quantified liabilities.
Any Tax Obligations must be Settled
Another step for a proper Business closing is to pay off all of its tax liabilities prior to making any payments to you as its owner. This helps avoid your becoming personally liable for your Businesses’ tax burden. Also, other private creditors can pursue payment by you, as the Business owner, if you have taken a premature distribution without first repaying the debts of your business.
Legal Entities need to be “Shut Down” with the Secretary of State
Other crucial steps in the closing of your Business may be to officially terminate your company’s existence with the Secretary of State. Corporations, LLCs, limited partnerships and limited liability partnerships, are all Business entities formed by filing paperwork with the Secretary of State, and thus must be terminated with the consent of the state. Before the Secretary of State will consider dissolution requests, it requires a Clearance Certificate from the California Franchise Tax Board. This certificate confirms that the company seeking dissolution has filed the appropriate tax returns and has paid all of its taxes, fees, and any other penalties. Failure to follow the established state statutes and procedures regarding your Business dissolution or failing to comply with tax regulations can have very severe consequences and open you up to legal liability.
Business Dissolution Lawyer Jonathan C. Watts is here to help you close your business.
Jonathan can help guide you and your Business through the uncharted course of dissolving your Business. Jonathan’s recent LL.M. in Taxation will prove pivotal in navigating your Business through the important steps required by the State of California as well as the Franchise Tax Board. Jonathan can help you insure that your Business is dissolved properly, your debts have been discharged, your tax liability paid and your personal liability is minimized. He can help you develop a comprehensive and thorough exit plan for your Business and can help you to dissolve your Business in the correct manner.
This is just a basic overview and is not legal advice specific to your situation. If you would like to speak with Jonathan about your situation, please email him at email@example.com or call 925-217-3255.
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Business Lawyer Jonathan C. Watts understands that investing some time in getting your contracts in order, handling common legal transactions, or negotiating a lease should be cost-effective. And for those facing a current legal crisis, Jonathan C. Watts understands that “winning at all costs” can be an empty victory for a small business attentive to the bottom-line.
Jonathan C. Watts is also a Tax Attorney and is able to advise you and guide you to wise choices at the same time he is reviewing or drafting your mission-critical daily documents. Moreover, with virtually every business having a web presence these days, Jonathan’s Internet Law Expertise will help you protect yourself in your Internet Business activities. Jonathan’s clients get maximum value for every penny spent, without padded hours for unnecessary “additional services.”
Call my office to talk to me personally or to schedule an appointment. My offices are open 9 am – 5 pm, Monday through Friday, and I make every effort to take your phone calls personally.
Call Jonathan: (925) 217-3255
|e-Mail Jonathan C. Watts||Map to Office|
|Call my office to talk to me personally or to schedule an appointment. My offices are open 9 am – 5 pm, Monday through Friday, and I make every effort to take your phone calls personally. Call Jonathan: (925) 217-3255|