When it’s Time to Close Your Business

Many business owners decide it’s time to close their doors due to a variety. Sometimes, the decision comes at the end of a long run or after a major loss in revenue. Sometimes, it’s because the company does not have a viable financial plan. Contracts have been terminated or the market has changed too rapidly to allow the business to compete.

Whatever the reason, it’s vital to come up with plans and follow them through. A qualified accountant or lawyer can help you determine the best way to reduce and eliminate assets and assure that all legal obligations are met. This includes filing dissolution documents and rescinding all permits and registrations, paying outstanding taxes, and closing business accounts. This also includes notifying creditors of debts and financial obligations and liquidating inventory. It also includes organizing an auction.

Notifying customers and returning deposits for unfulfilled orders are also crucial considerations. It’s also important to notify employees and give them as many notices as you can so they can plan their exit. This will preserve your relationships and avoid unnecessary stress. It’s important to collect and analyze company’s records to properly close out the company finances, such as settling financial obligations, issuing final payroll, and closing company credit cards (which can affect personal credit ratings).

After everything is done, it’s the time to close the business. Failure to complete even one of these tasks could result in penalties and additional fees. The IRS has an extensive list of tasks you need to complete. We also suggest that you contact other government agencies like professional licensing boards or local, state or federal tax agencies.

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