what kind of lawyer do i need to close my business

Full Answer

What kind of lawyer do I need for a small business?

Business Lawyer (litigation or transactional) Many business owners assume they need a “business lawyer,” whatever the nature of the legal problem they’re experiencing. In fact, “business law” is too broad a category to be meaningful. Business lawyers generally fall into two mutually exclusive categories: litigation and transactional.

What should I do if I want to close my business?

Cancel registrations, permits, licenses, and business names. Protect your finances and reputation by canceling any of these that you no longer need, including your trade name. Comply with employment and labor laws.

Do I need a business attorney to file bankruptcy?

A business attorney who's been through business closings can be a huge help in deciding whether to file bankruptcy and guiding you through the closure process. In addition to dealing with recalcitrant landlords and other creditors, an attorney can alert you to any potential liabilities you haven't considered or any steps you might omit.

What kind of cases do lawyers deal with?

Examples include “premises liability” cases (such as where you’ve slipped and fallen at a commercial establishment due to an unsafe condition), medical malpractice cases, and animal attacks. 10. Real Estate Lawyer Real estate lawyers deal with rights concerning land, water, and structures.

How do I close down my own business?

Close your businessDecide to close. Sole proprietors can decide on their own, but any type of partnership requires the co-owners to agree. ... File dissolution documents. ... Cancel registrations, permits, licenses, and business names. ... Comply with employment and labor laws. ... Resolve financial obligations. ... Maintain records.

Can I just close my business?

Business owners can close their businesses, whether temporarily or permanently, at any time they choose, provided that they take the appropriate steps to ensure the protection of employees and corporate partners, if applicable, as well as service providers, customers and vendors with outstanding orders.

What is the fastest way to close a business?

5 Ways to Exit Your Small Business FastThe Time to Sell is Declining (Though Not Fast Enough)Strategies for a Quick Business Exit.Reach out to likely buyers. ... Add a business partner. ... Sell to your employees. ... Offer incentives. ... Liquidate your assets.

How do you close a business contract?

You may terminate a contract if you and the other party have a prior written agreement that calls for a contract termination because of a specific reason. The usual name for this type of provision is a break clause. The agreement must give the details of what qualifies as a reason for contract termination.

Do I need to close my EIN number?

Regardless of whether the EIN is ever used to file Federal tax returns, the EIN is never reused or reassigned to another business entity. The EIN will still belong to the business entity and can be used at a later date, should the need arise.

Do I pay tax if I close my business?

If you closed your business just by stopping operations, there is nothing else to do for your income tax return.

How do you close out an LLC?

Steps to Cancelling an LLCStep 1: Vote to dissolve your LLC. ... Step 2: Filing federal, state, and local tax forms (e.g. IRS Form 966) ... Step 3: Cancel all LLC licenses and permits. ... Step 4: Notifying creditors your company is ending. ... Step 5: Settling claims from creditors. ... Step 6: Distribution of assets remaining.More items...

When should you close down a business?

When to Shut Down a BusinessYou Aren't Making Money.You Aren't Meeting Your Goals.Nothing You've Tried Has Worked.Marketing Isn't Reaching An Audience.Your Competitors Have Taken the Lead.You Have The Customers, But Still, Aren't Making Ends Meet.Customers Are Not Long Term.More items...

What happens to inventory when closing a business?

Inventory Liquidation Businesses that use liquidation as an exit strategy typically sell their inventory in going-out-of-business sales to the public. They may also sell a portion of their inventory or assets at a public auction.

What does it mean to dissolve a business?

A business dissolution is a formal closure of a business with the state. A small business cannot hang up a “closed” or “out of business” sign outside their storefront, turn off the lights, and lock their doors to be considered a dissolved business.

Who has the right to terminate the agreement at any time?

1 - Termination of contract in case of fundamental non-performance. (a) If a party's failure to perform its obligation amounts to a fundamental non-performance, the other party may terminate the contract. (b) The right of a party to terminate the contract is exercised by notice to the other party.

What are some ways to terminate a contract?

There are two basic types of termination: 1) termination for cause, otherwise known as termination for default; and 2) termination for convenience. A party's right to terminate its contract may originate from the general principles of contract law or it may arise out of the terms of the contract itself.

What are the legal issues in selling a business?

Some examples of such issues include, but may not be limited to: Creation and negotiation of sales contracts. The most common legal issues in a business sale are those involving the division of property and handling of debts.

What are the legal issues in a business sale?

Creation and negotiation of sales contracts. The most common legal issues in a business sale are those involving the division of property and handling of debts. These issues most often require extensive analysis in order to determine the exact amounts owed.

What does an agent do for a business?

An agent will assist in advertising that your business is for sale, which can in turn bring in more offers. Additionally, an agent can advise selling owners of whether specific offers are worth considering. Purchasing an existing business has numerous benefits, for both the purchaser and the seller.

Why do people sell their businesses?

There are several reasons to do so, but the most common reasons for selling a business include: It would be a better investment to sell the business. When a business owner decides to sell their existing business, they will need to be ready to commit some time to organizing all of their financial documents .

When a business owner decides to sell their existing business, do they need to be ready to commit?

When a business owner decides to sell their existing business, they will need to be ready to commit some time to organizing all of their financial documents. Additionally, they will need to spend a considerable amount of time getting the company in order.

What are the benefits of purchasing an existing business?

For the buyer, such benefits include: The company, physical location, employees, and customer base are already established; Saved time and energy required to start a new company;

Do I need a business attorney to draft a business agreement?

You need a business attorney to draft the agreement. Depending on the entity structure of the business will determine how complicated the transaction will be. For example, if it was a sole proprietorship it would be easy, but a corporation would be more complex...

Should I have an attorney for buying a business?

You haven't mentioned if you are buying the assets or the entity , nor if you did any due diligence on the entity or the business. There are a number of things that must be looked into before you purchase a business, including, for example, whether there...

What happens if your business doesn't cause environmental problems?

An environmental issue arises and your business is involved (even if your business didn't cause the environmental problem, you may be penalized) Negotiating for the sale or your company or for the acquisition of another company or its assets.

Do you need legal help when it's too late?

But when you do, it's good to know where to find the right one. And -- more to the point -- you may not know you need legal help until it's too late, as attorneys can help you stay in compliance with the law and spot developing legal issues early.

Do You Need to Vote to Close the Business?

If it is just you and you are operating as a sole practitioner, you can close down if you so choose. However, if your business is a LLC, corporation, or partnership, you will need to review the procedure for dissolution that was agreed upon when you formed the business.

How Do You Dissolve the Business with the Government?

Even if you dissolve your business with your partners, you will want to make sure that you file the correct government forms with your state. This will eliminate your liability for business taxes as well as other filings, and it will also inform creditors that your business is no longer acquiring debt.

How to Cancel Permits, Licenses, and Fictitious Business Names

Be sure to cancel all permits, licenses, and anything else that you used fictitious business names. If there is no record of cancelation, you could remain on the hook for taxes and penalties associated with your business, long after it has been dissolved.

Notify Your Creditors, Employees, and Customers

In addition to notifying the government that you are closing up shop, you should also notify the following people and businesses:

Should I Consult a Lawyer When Closing a Business?

If you are ready to sell or close your business, you should first contact a business attorney near you. An experienced lawyer will assist you in the preparation of all necessary paperwork, and will help to ensure nothing is left unfinished.

How to dissolve a business?

Follow these steps to closing your business: 1 Decide to close. Sole proprietors can decide on their own, but any type of partnership requires the co-owners to agree. Follow your articles of organization and document with a written agreement. 2 File dissolution documents. Failure to legally dissolve an LLC or corporation with any state you’re registered in will expose you to continued taxes and filing requirements. Look up your state for more information from the Secretary of State, Business Bureau, or Business Agency websites. 3 Cancel registrations, permits, licenses, and business names. Protect your finances and reputation by canceling any of these that you no longer need, including your trade name. 4 Comply with employment and labor laws. Reference the Department of Labor’s Worker Adjustment and Retraining Notification Act (WARN) for employee payment after closing, along with other federal and state laws. 5 Resolve financial obligations. Handle final returns for income tax and sales tax. Cancel your Employer Identification Number, notify federal and state tax agencies, and follow this checklist from the IRS with instructions on how to close your business. 6 Maintain records. You may be legally required to maintain tax and employment records, among other files. Common guidelines advise keeping records for anywhere from three to seven years.

Does transferring ownership of a business require tax?

Transferring ownership of a family business may have legal impacts, such as estate and gift tax obligations imposed by the IRS. A transfer of property would also likely require taxation. It’s also important to understand how to approach the exit strategy based on business type.

What do real estate lawyers do?

Real estate lawyers deal with rights concerning land, water, and structures. Perhaps you need to determine whether a lien has been asserted against your property, or you need to carve out an easement. Maybe you need to divide one lot into two or more lots, or change the zoning classification, or move a boundary line.

What is a traffic lawyer?

Traffic Lawyer. Traffic lawyers are often considered a type of criminal-defense lawyer, but there’s a big difference between being accused of murder and being accused of running a red light, and different considerations come into play in formulating defense strategy.

What is transactional lawyer?

The transactional lawyer will incorporate your startup, help secure funding, draft your employment and non-disclosure agreements, issue stock, spin off subsidiaries, and countless other tasks associated with operating your business. Unlike the business litigation attorney, the transactional lawyer does not go to court.

Why do you need a defamation attorney?

You want a defamation attorney if you need to take someone to court for defaming your character through libel and/or slander, or if you’ve been accused of causing harm to the reputation of another individual or business by making false and defamatory statements of your own.

What are some examples of premises liability?

Examples include “premises liability” cases (such as where you’ve slipped and fallen at a commercial establishment due to an unsafe condition), medical malpractice cases, and animal attacks. 10. Real Estate Lawyer. Real estate lawyers deal with rights concerning land, water, and structures.

What do you want from your ex wife?

You want a divorce. You want custody of your kids. Your ex-wife wants an increase in her spousal support and you’d rather not give it to her. You’re getting married and you want to ensure you won’t lose half of everything you own if you ever get a divorce. If your legal needs involve family relationships and obligations, you need a family lawyer.

What is considered criminal defense?

Criminal Defense Lawyer. Courtroom proceedings are considered criminal in nature (as opposed to civil) when the state (through prosecuting attorneys) charges you with the commission of a crime. If you’ve been arrested, read your Miranda rights, and taken into custody by the police, you need a criminal defense lawyer.

What to do when your business closes?

Make sure to notify the Internal Revenue Service (IRS) that your business is closing and take care of any outstanding taxes. If you have employees, make your final payroll tax deposits and file your final federal and state employment tax returns. You and your co-owners can be held personally liable for unpaid payroll taxes.

What is the process of closing a business?

Closing a business is a multi-step process that varies state-by-state based on the business structure – corporation, limited liability corporation (LLC) or partnership. There are general guidelines to follow, however, for how to close a business. Having a checklist ensures the process goes smoothly and lets you walk away from your business free ...

How long does it take to dissolve a partnership?

The process from filing a statement of dissolution to dissolving the partnership may take up to 90 days and, once complete, renders your partnership agreement null and void.

How to dissolve a corporation?

Dissolving a Corporation. Call a meeting of the board of directors and vote to formally dissolve a corporation as set out in the corporate bylaws or articles of incorporation. As a rule, it requires a majority, or two-thirds, vote to dissolve a corporation. In some instances, a unanimous vote may be required.

What to do if a business cannot pay off its debt?

If the business can’t pay off all its debts, arrange a settlement with creditors or file bankruptcy. If a partnership cannot afford to pay its debts, each partner is personally responsible for paying off the remaining debt and creditors can come after your personal assets.

How long do creditors have to file articles of dissolution?

In some states, you must do this before filing articles of dissolution. As a rule, creditors have between 90 and 180 days after the date of the notice to submit a claim; the exact deadline is established by state law. Let creditors know that claims submitted after the deadline are barred.

Can a business close a bank account?

Closing a business isn’t an easy way out of debt: a corporation or LLC must settle its debts before it can distribute the remaining monies to the business owners. After all the creditors have been paid, close the business bank account and cancel the credit cards. If the business can’t pay off all its debts, arrange a settlement with creditors or file bankruptcy.

Who can advise you on selling assets?

Even more important may be seeking the advice of an accountant or tax expert, who can advise you on the tax consequences of selling assets, the various tax forms you'll need to file, and ways to take advantage of your business losses for tax purposes. For help, connect with a local business attorney.

How long do you have to notify creditors of a closed business?

Comply with "bulk sales laws ," if required. (If you sold your inventory, you may need to notify your creditors a specific number of days before you close your business, and in some states, to publish a notice of your impending closure in a local newspaper.) Close your business bank account and any other accounts.

How to wind up a business?

Notify and pay your employees. Give employees some notice if possible. If you need an employee to help wind up the business, offer the employee a small bonus to stay until the very end. Plan to pay employees their last paychecks on their last day, with the value of accrued, unused vacation days if your state requires it.

How long does it take to wind up a business?

In ordinary times, it can take months to wind up a business properly. Ideally, you want to create and follow a closing plan that offers the most protection possible to your personal assets, your credit, and your reputation in the community—and to those of your spouse, cosigners, and lenders. However, these are not ordinary times.

How long do you have to give notice to a landlord to terminate a commercial lease?

Terminate your commercial lease. Give your landlord the required notice stated in your lease -- at least 30 days. Due to the pandemic, some landlords may agree to defer your final lease payment. Notify and pay your employees.

Step 2: Create a dissolution proposal

The first thing to note is that this step is only required for public corporations to figure out how to close a business. If you’re not public, you can move on to Step 3.

Step 3: File articles of dissolution

Now that you know you want to close down the business for good—and you've gotten everyone on board—it’s time to keep the state you do business in updated by filing articles of dissolution. This is a big step in the process of how to close a business.

Step 4: File a withdrawal

Did you previously register your corporation or LLC to do business in another state?

Step 5: Distribute assets

Now that your corporation or LLC has completely dissolved in every state it does business in, it’s time to distribute any remaining assets. Good news—we’re now on the last step of how to close a business in its entirety.