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Business Dissolution Attorney in Overland Park, Kansas

Owning and running your own company not only takes a quick mind for business, but also a steadfast work ethic and commitment to quality. After everything you’ve been through to get your business off the ground, it can be hard to think that it may one day end. Yet this will likely happen at some point. When it does, you’ll want to ensure you’re winding up your business with the same care and attention to detail as when you first established it.

For owners and partners in the Overland Park area, including those in Kansas City, MO and throughout Johnson County and Jackson County, reach out to us at Coppaken Law Firm to learn the right way to dissolve your business. 

Reasons for Dissolving a Business

There are a number of reasons to seek business dissolution and not all of them mean your business has “failed;” rather, it simply means you’re moving on to the next opportunity and your professional life needs to accommodate that change. In any of these instances, it’s important not to view the dissolution as a defeat, but instead as an opportunity to start fresh. Some common reasons businesses may need to dissolve include:

  • A dispute between business partners that’s not possible to resolve 

  • Competition in the marketplace has made your current profit margins unsustainable 

  • You’ve decided to declare bankruptcy 

  • Economic trends don't support your business model and you’re moving on to something more profitable 

  • One or more partners wishes to exit the company 

  • The owner has passed away or is retiring and doesn’t wish to continue the business 

  • A history of poor management has forced the business to close 

The type of business that you initially established (LLC, corporation, or sole proprietorship) will also inform the process for dissolving it. Although you can complete this process on your own, it’s highly recommended you work with an attorney who’s skilled in business law to ensure you’re following the correct process, your best interests are being protected, and that you’re minimizing any tax implications.

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Dissolving an LLC

When members of an LLC decide to dissolve their business, they can do so in one of two ways:  

  • The first option is if one of the dissolution triggering events occurs. These are provisions that are written into the operating agreement when the LLC is first started that require the members to formally dissolve the business. Common dissolution triggers are the death or retirement of a member or a declaration of bankruptcy.  

  • The second option is when all the members take a formal vote on whether or not to dissolve the business. If all members agree, you can then proceed with dissolution.  

No matter what the cause, the general steps for dissolution of an LLC will be the same: 

  1. File Articles of Dissolution with the Secretary of State as well as cancel any legal documents in other states you’ve done business in.  

  1. File your final state and federal tax return as the LLC  

  1. Address all final payroll obligations if you have employees including wages and taxes 

  1. Settle all debts and creditor claims 

  1. Distribute assets to the members 

  1. End any lease agreements and close your Federal Employer Identification Number (FEIN) 

Dissolving a Corporation

Like an LLC, the partners in the corporation will have to take a formal vote (which usually requires calling a board meeting) to dissolve the business, but you’ll first have to send out a notice to shareholders since some of them may be entitled to vote. You can then follow these steps: 

  1. File dissolution paperwork with the Secretary of State 

  1. Notify all your creditors of the dissolution and give them adequate notice to send in claim requests 

  1. Pay off all past debts and taxes (note that in Missouri you’ll likely be required to obtain tax clearance from the state before you can begin dissolution) 

  1. Distribute any remaining assets 

  1. Close out any bank accounts, licenses, and registrations  

Dissolving a Sole Proprietorship

A sole proprietorship is unique among business models because by definition they only have one person running them and often don’t even need to be formally dissolved at the state level. Taxes under a sole proprietorship are filed under the individual, but you will still be responsible for any tax obligations of your business. You will also be required to notify the IRS that you’re no longer in business, but since you didn’t need to file any articles of incorporation, you don’t need to file any dissolution paperwork either.   

You will, however, still need to cancel any licenses you obtained, pay off any debts, collect on past-due accounts, and sell off any assets if necessary. Speak with a reliable attorney to get the knowledgeable legal assistance you need.

Business Dissolution Attorney in Overland Park, Kansas

For business dissolution help in the Overland Park, Kansas area, turn to the team at Coppaken Law Firm for professional yet personable legal help.