BUSINESS DISSOLUTION ATTORNEY IN MINNEAPOLIS, MINNESOTA
People enter business ventures with the best intentions. Unfortunately, much like personal relationships, business arrangements don’t always last forever. For cases in which your business cannot continue, seeking guidance to assist you with business dissolution is your best option.
At Engel Professional Association, we give our clients and their business matters the attention they deserve. Our attorney is ready to help you assess your situation, make sure you understand your options, and lead you toward the right path for you and your business.
If you need help with business dissolution in the greater Minneapolis area, including St. Paul, Mankato, Maple Grove, St. Cloud, and Woodbury, reach out to us to schedule a consultation.
Reasons for Dissolving a Business
There are a variety of reasons why businesses end up being dissolved. While many of them are related to money issues, there can be other factors at play. Some of the most common reasons for business dissolution include:
Death/Disability: If the leader of a business or another key member becomes disabled or passes away, it may cause irreparable harm to the business to the point of making it impossible for it to remain in operation.
Legal problems: Lawsuits, such as product liability claims, can cripple a business financially, whether due to judgments being made against the company or simply the cost of litigation.
Mismanagement: Poor decision-making, flawed company structure, and other errors can lead to the failure of a business.
Financial failure: From economic downturns and bankruptcy to simply losing business to a competitor, lack of revenue is the most common reason for business dissolution.
Though these reasons are common among many cases of business dissolution, the process you need to go through to dissolve your business depends on your business type.
Dissolving an LLC
There are specific steps to follow when dissolving a limited liability company (LLC). A brief breakdown of these steps is as follows:
Have the LLC members officially vote to dissolve it.
Make sure the LLC’s final tax returns are filed.
File the official paperwork for dissolution.
Notify any creditors of the LLC’s dissolution.
Settle outstanding debt and liquidate the LLC’s remaining assets.
Cancel any licenses or permits and close all business accounts.
If your LLC is operating in multiple states, be sure to take the appropriate steps to cancel the business’s registration in those states.
Dissolving a Corporation
Dissolving a corporation has similarities to dissolving an LLC but with the added steps of dealing with the corporation’s shareholders. The process of dissolving a corporation includes:
Have the board officially adopt a resolution to dissolve the corporation.
Notify shareholders of the dissolution and hold a shareholder vote on the board’s resolution.
File the required articles of dissolution with your state.
After the corporation has been dissolved, there is also a “winding up” period in which you will follow steps like those listed above for dissolving an LLC, including paying off outstanding debts, filing final tax returns, notifying creditors, and closing all business accounts.
Dissolving a Sole Proprietorship
In many respects, dissolving a sole proprietorship is more simplified and straightforward than dissolving other types of businesses. The steps for dissolving a sole proprietorship include:
Notify the IRS of your business dissolution.
Cancel all licenses and closing accounts in the business’s name.
Pay off any remaining business debt and collect any outstanding past-due accounts.
If clients or customers who owe your business money are unresponsive, you may need to attempt to collect through other means, including legal action or hiring an outside collections firm for help. No matter your situation, collaborating with a knowledgeable business law attorney is crucial for pursuing your optimal end result.
Business Dissolution Attorney in Minneapolis, Minnesota
Though dissolving your business is not a simple process to go through, there is knowledgeable help available to you. If you’re in Minneapolis, Minnesota, and need help with business dissolution matters, contact our team at Engel Professional Association today to schedule a consultation to discuss your situation. We serve clients throughout the surrounding areas of St. Paul, Woodbury, St. Cloud, Maple Grove, and Mankato.