How to Handle the Legal Aspect of Ending a Business Partnership in California
September 15, 2017
Ending a business partnership in California can be complicated from a personal, financial and legal standpoint. It is crucial to make sure that you complete this process correctly so that you do not end up with expensive and time-consuming issues that arise after your partnership is no longer operating.
Your partnership agreement may have specific requirements about what must be done to properly end your business partnership. In addition, you should keep in mind that in most partnerships in California a majority of the partners agree to dissolve the partnership before it can be officially dissolved. You should also take care to notify any existing customers, suppliers or vendors so that the appropriate actions can be taken to close out your accounts.
It is generally the case that all of the debts of the partnership must be paid before any partners can take any distributions or the assets can be completely disposed of. You should have a clear idea of the partnership’s existing debts so that you are aware of what assets may remain.
California requires that you file a Statement of Dissolution, which is a form designed by the state. This can be filed either online or by mailing a paper copy to the California Secretary of State.
Finally, you must make sure that you file a final tax return for the partnership with the California Franchise Tax Board. Make sure that you also follow any of the requirements of other states in which the partnership is registered to do business so that you are not left with any outstanding obligations after the partnership is no longer transacting any business.
Consult with a Trusted and Knowledgeable Business Attorney in California
To make sure that no issues are overlooked in ending your business partnership in California, it is recommended that you speak with an experienced business attorney. Call us at (949) 788-8900 to set up an appointment with the experienced business attorneys at FitzGerald Yap Kreditor LLP to make sure that you avoid costly and frustrating mistakes in ending your business partnership in California.
