Changing an LLP to Sole Proprietorship?

Discussion in 'Growing and Managing a Business' started by apas, Feb 22, 2012.

  1. apas

    apas
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    Hi everyone. I started a small business with a friend in New York City in 2006. We have our business certificate with the state and were issued an EIN. At this point I've decided that I no longer want to be involved in the company, but he wishes to carry on. I'm not looking for a buyout or to exit with any assets (we don't really have any), I just no longer want to be associated with / responsible for the company. I'm trying to make a clean break.

    My question is:
    - Is it possible for my partner and I to take my name off of the business and make him the sole proprietor?

    Thanks!
     
  2. Business Attorney

    Business Attorney
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    You can't really change an LLP to a sole proprietorship. The LLP simply needs to dissolve and the business will be carried on by one of the former partners.

    To be an LLP, your business must first and foremost be a partnership. A partnership, as defined in New York law, is "an association of two or more persons to carry on as co-owners a business for profit..." A business owned by only one person can never be a partnership, so when you give up your interest in the LLP, the business ceases to be a partnership and the partnership is dissolved. On dissolution the partnership is not terminated, but continues until the winding up of partnership affairs is completed.
     
  3. rjd1265

    rjd1265
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    I did this exact same thing about 3 years ago. We just went to the lawyer who drafted the first LLC and he changed it to the SP. I got paperword from the state about 8 weeks later stating I was removed from the business. I am not sure if the lawyer disolved the LLP and reinstated as a SP but it only cost $137 for me to do this.
     

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