How do I close shop?

Discussion in 'Growing and Managing a Business' started by JamesRC, Nov 15, 2013.

  1. JamesRC

    JamesRC
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    Hi Everyone!

    I'm new hear and have a question. For the last couple of years, I had a side business I dabbled in. It made some money but it mostly cost more to operate than it made. I have a DBA (dba widgets.com for example) but, my focus will now have nothing to do with business.

    I'm completely changing my model and branding myself. The business model, though, is pretty much the same (affiliate businesses, digital products all online.)

    I have two options as I see it (maybe I have more - please tell me)

    1. Close widgets.com and terminate the dba and re-open as my-name enterprises.

    2. Keep the widgets.com and create a sub-dba widgets.com dba newbrand.

    3. ????

    I did claim my losses (and modest gains) with good ol' Uncle Sam but am concerned about raising red flags as well for an audit which is why I'm leaning against #1. I'd rather take the audit than do anything that looks like I'm trying to dodge one.

    Any and all suggestions are welcome!

    Design your life.

    James
     
  2. Business Attorney

    Business Attorney
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    If you were a sole proprietor doing business as widgets.com, there is really nothing to close. You simply stop doing business.

    If you had a business entity (an LLC or a corporation), then the answer is a little more complicated.

    In either case, I don't think that terminating the business will raise red flags for an audit. The red flags, if there are any, would be what you reported as income and expenses, not the fact that you subsequently closed the business.
     
  3. JamesRC

    JamesRC
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    Mr. Attorney (if that is your real name :) ) Thanks for the advice. It was set-up as sole proprietor. I will stop doing it and start doing the second business. I appreciate the reassurance.

    James




     

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