How to Dissolve a Business Partnership

Discussion in 'Articles & Tutorials' started by bytrade001, Jan 12, 2012.

  1. bytrade001

    bytrade001
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    1
    Analyze why you want to dissolve the partnership. Perhaps you and your business partner don’t get along or you have different end goals at this point in the business. Perhaps one of the partners wants to retire and no longer has the energy or desire to work on the business. You have to look at your assets, customers, inventory, and anything else that is shared in the business. Sometimes it just doesn’t make sense to dissolve the business. Be sure you analyze the situation before attempting to dissolve the business. It is a lengthy and expensive process. Remember: both partners must agree to dissolve the business.

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    Get information on dissolving your business. Go to your state’s government website and look for information on businesses. They should have a form for dissolving a business partnership. Print out the form, fill it out, have both partners sign it. A business can dissolve completely or dissolve and become a corporation or llc.

    3
    Once the business is dissolved, you need to file a statement of dissolution, which lets third parties know that neither partner has any rights to enter into binding transactions unless it’s to wrap up the business. It is usually assumed that all third parties know of the dissolution after ninety days of filing the statement of dissolution.

    4
    Notify the people you do business with. Be sure to send out a nice letter or card letting people know about your business dissolution. You can send them to your customers, clients and suppliers. Usually, the partner who initiated the dissolution is responsible for announcing it. If you are dissolving the business and starting a new company, be sure to include the information in the notice, including the new company name and contact information.

    5
    Examine leases, contracts and loan agreements before dissolving the business. You want to make sure that there will be no legal issues if the business is dissolved. You don’t want someone filing a lawsuit against you and your partner because you didn’t follow the agreement. Don’t neglect to learn if the dissolution of the partnership will affect those agreements.

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    Get a business attorney. You may want a business attorney to help you through the process, especially if your business has grown significantly or if you could be facing liability issues. A business lawyer will help you through the process.
     
  2. Mark T

    Mark T
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    Well, dissolving partnerships also takes some time and a lot of CONSIDERATIONS. Sometimes, it is not that worthy to dissolve it, and it requires a lot of decision making to further know if it will be worth the effort in doing it.
     

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