Help With Business Dissolution In Pennsylvania
A business divorce is, simply put, a divorce of business partners. Usually we see business dissolutions as a result of the economy or when one of the participants no longer wants to be involved in the business. If the business was properly formed, bylaws created and/or buy-sell agreements put into place at the beginning, it is much easier to dissolve the business and the parties can then go their separate ways.
However, we frequently see business owners coming to us who have not put any of these safeguards in place. We have to then address who is going to get what from the business and who will pay whatever debts have been incurred.
We refer to this as a business divorce because many of the issues are similar to those of divorcing couples, such as who will retain what assets, who will retain certain debts and who will be responsible for winding up the company, along with other business law issues. Parties are urged to seek counsel early on in the process of dissolving a business.
What Can Lead To A Business Dissolution?
Business partners often face challenges that can lead them to consider dissolving their business. Just a few common reasons for a business dissolution might include:
- A change in individual goals
- Market conditions that make the business unsustainable
- A mutual decision to pursue other interests
- The necessity of filing bankruptcy
- The retirement of one or more partners
Whatever the cause, understanding that dissolution is a common and sometimes necessary step can help us approach the process constructively.
What Is The Process For Dissolving A Sole Proprietorship In Pennsylvania?
Dissolving a sole proprietorship in Pennsylvania involves a few critical steps:
- First, you need to settle any outstanding debts and obligations.
- Then, you need to file a document called a certificate of dissolution or an article of dissolution.
- After, you can disburse any remaining business assets.
- Finally, you should cancel any licenses or permits you hold.
These steps are crucial to ensuring that you wrap up your business legally and cleanly.
What Are The Penalties If I Don’t Follow The Dissolution Process Correctly?
Failing to follow the proper dissolution process can lead to significant complications. You might face legal consequences or financial liabilities, which could impact your future endeavors. It’s important to adhere to the correct procedures to avoid unnecessary risks and ensure a smooth transition out of your business.
Contact A Pennsylvania Business Lawyer Today
We offer a free in-office consultation on business divorce matters. Call the attorneys of Rowe Law Offices, P.C., at 610-816-0935 or 866-232-1913, or send us an email.