How To Close A Business
Do you want to learn how to close a business? Whatever your reason for closing a business, there are important things you should know. In order not to leave some loose ends, you need to take care of certain matters that will make you secure with your legal responsibilities as you close a business.
- File an IRS Form. This involves filing your final federal tax deposit on the year when you choose to close a business. On the process, you should also include the filing of the final employment tax returns of your employees. The IRS advises that upon filing of the IRS form, include in the report the names of the payroll clerks responsible for keeping the payroll records and where you intend to keep these files.
- Coordinate with your local government concerning the process they require when closing a business within your state. While there are requirements required by a state for opening a business within an area of jurisdiction, there are also some requirements required for closing a business. It is safe when you try to inquire for the possible requirements that you need to comply in order to close a business. This may include cancellation of your license and business permit and liquidation of your business assets. Corporations may also need to dissolve their juridical personality with the government and to clear their business from other liabilities such as tax issues, etc.
- Inform your clients. As you close a business, it is prudent to inform your clients regarding your decision. When you are planning to open a different business, this can help you advertise your new market venture to retain the patronage of your customers.
- Pay creditors and employees. As you close a business, it is your responsibility to compensate your employees before terminating their services. You also need to make sure that you properly inform your creditors and make arrangements for the payment of your debts if there are any. Likewise, it is also prudent to pay and inform your suppliers, service providers, and pay any bills accrued during the operation of your business.
- Keep the files and records of your business. It is wise to keep all existing official documents pertaining to your business transactions and operations even as you close a business. They may come in handy later on should there be some problems and issues that may arise later on.
- Be organized. Because it is not easy to close a business, you will need to be organized with the proper documentation to do. Keep a check list to ensure you have everything covered as you close a business to avoid future impediments in the future.