SC Business Dissolution Attorneys in Myrtle Beach
Ready to lock the doors and close your business? It’s as easy as hanging a “closed” sign on the door and moving on, right?
Not so fast…
Depending on the type of corporate structure, operating agreements, assets, and liabilities of the company, there may be actions that need to be taken before making the decision to dissolve the company and before filing the Articles of Dissolution once the decision is made.
Voluntary Dissolution of a SC Business
“Voluntary dissolution” means that you are making the decision to dissolve the company and pro-actively file the Articles of Dissolution with the SC Secretary of State’s Office.
An “involuntary dissolution” means that you did not follow the necessary steps for dissolving the company – the Secretary of State’s Office will then consider the company abandoned and will eventually “involuntarily terminate” your company.
In most cases, involuntary dissolution is not a good idea – a failure to formally wrap up business and dissolve a company could expose you to future liability and unexpected lawsuits.
Making the Decision to Dissolve a Business in SC
The first consideration before dissolving a business in SC is whether you can dissolve the business…
For example, if you have a sole proprietorship you do not need permission and you can make the decision to dissolve the business. Depending on your circumstances, you may still want to consult your SC business attorney to ensure that business assets are disposed of with minimal tax liability and that you do not have any outstanding debt to be collected or creditors that may file suit.
On the other hand, if your business is a corporation or limited liability company (LLC), you may be required to obtain written permission from the other owners, members, shareholders, or board of directors. In some cases, we may be able to administratively dissolve the corporation through the courts without written permission.
Winding Down a SC Business
In most cases, dissolving your business is not as simple as filing Articles of Dissolution – there are many steps in the process to ensure that you are not breaching contracts, breaching fiduciary duties, exposing yourself to creditors or tax liability, or leaving money uncollected:
- Notify any creditors: You will need to provide notice to any creditors that the company is going to be dissolved and provide them with a deadline to make any claims against the company;
- Negotiate or defend against any creditor claims: In some cases, your SC business dissolution attorney can negotiate reduced payments to settle creditors’ claims. In other cases, we may need to defend against last-minute lawsuits filed by creditors;
- Collect money that is owed to your business: It is usually a good idea to make your own claims, negotiate your claims, or file suit to recover money that is owed to your company before filing the Articles of Dissolution;
- Notify employees and others who have a stake in your business;
- Notify federal and state tax authorities that the business is closed;
- Review any existing insurance policies, sales agreements, or rental agreements to ensure they are resolved before the company is dissolved;
- Cancel your business licenses: Otherwise, they might come looking for their business license fees next year…
- Ensure that you are complying with any rules for dissolution found in the Articles, operating agreement, partnership agreement, or by-laws;
- Dispose of the business’s assets: Any property or funds owned by the company must be disposed of in compliance with any operating agreements or partnership agreements; and
- File Articles of Dissolution with the SC Secretary of State.
Your Myrtle Beach Business Dissolution Lawyer at Axelrod and Associates will help you to determine what steps are necessary to dissolve your business and what needs to be done to wind down operations before filing your Articles of Dissolution. Call today at 843-353-3449 or complete our contact form to set up an initial consultation to find out how we can help.