Businesses may fail for multiple reasons, including low sales, changes in the market, poor management, increased debt, and other causes beyond the business’ control. In such instances, the most practical option may be to dissolve the corporation. Some business owners also choose to dissolve their companies because the purpose for which it was established has been achieved.
The laws for dissolving a corporation in Massachusetts can be complex. Disputes and other legal complications can arise during dissolution, making it essential to work with a business dissolution attorney with experience in the field. At Calabrese Law Associates, our professionals guide clients through the various steps to shut down their operations and dissolve efficiently. We also advise owners who decide to sell their businesses and work with them to facilitate the process.
What Is Business Dissolution?
Business dissolution is the process a person undertakes to terminate a corporation’s existence. Technically, a corporation continues to exist as a legal entity after dissolution but may not carry on a business. To ensure the company has completely ceased to exist, it should be wound up and liquidated.
There are two types of business dissolution in Massachusetts — voluntary and involuntary. Involuntary business dissolution may arise under a court decree or various administrative reasons, including failure to comply with relevant state laws, when the business becomes inactive, or when the dissolution is in the public’s interest. Voluntary dissolution is when the shareholders decide to terminate the entity.
Dissolving a business is more than simply hanging a “closed” sign on your storefront. Some steps must be taken when dissolving, which involve notice to governmental entities, creditors, clients, banking institutions, and business partners.
When voluntarily dissolving a business, you may be required to:
- Check the articles of organization or the Business Corporations Act (BCA) for the appropriate dissolution procedure.
- Receive written approval from shareholders or board members.
- File tax forms at the local, state, and federal levels.
- File a certificate of dissolution.
- Notify and settle with creditors.
- Divide the remaining business assets among the interested parties.
- Close all bank and service accounts and credit lines.
- Terminate all licenses and permits.
- Inform customers and vendors about the dissolution.
Other legal issues may arise that require an experienced business lawyer’s counsel and advice, such as creditors rejecting your claims or overseeing stock distributions.
If your company is facing involuntary dissolution, there may be ways you can avoid it. For example, if you have unpaid debts to creditors, it may be possible to negotiate a payment plan. It also may be possible to dissolve voluntarily before the court gets involved, which could save you time and money. An attorney at Calabrese Law Associates can provide you with the legal know-how to help you navigate your particular situation and achieve the best possible outcome.
The Benefits of Legal Assistance for Business Dissolution
Closing a business in Massachusetts is generally straightforward when you partner with attorneys with deep knowledge and a wealth of experience. The business attorneys at Calabrese Law Associates strive to understand your needs and offer personalized and practical solutions to help you achieve your goals. We assist you at every stage of the process to achieve the best possible outcome.
Dissolving a Limited Liability Corporation (LLC) or another business in Massachusetts requires several steps. This process includes complying with the procedures in the articles of organization or Business Corporation Act (BCA), closing bank accounts, notifying creditors and claimants of the dissolution, and preparing and filing various documentation, sometimes according to established timelines. Clients who work with Calabrese Law Associates leverage our trusted services and support to ease the process and take the load off their shoulders.
Our in-depth knowledge of corporation dissolution in Massachusetts allows us to evaluate your unique situation and needs to provide guidance aimed at protecting your interests. We work hard to ensure that the entity’s assets are well-distributed and liabilities are covered according to law and best practices.
When Do You Need a Lawyer for Business Dissolution?
Securing a business dissolution attorney may not be mandatory when you decide to close your business in Massachusetts. However, it is recommended that you do so. Typically, multiple legal issues arise during the dissolution process, such as settling outstanding debts and liabilities and transferring assets. These activities can be technical.
For example, the process and documentation required to dispose of landed property may differ from other kinds of assets. Similarly, the settlement of tax obligations may require compliance with specific legislation.
Attorneys have the skill to help you navigate through these legal hurdles. The lawyers at Calabrese Law Associates assist business owners in the Greater Boston area and Massachusetts to mitigate potential risks associated with corporate dissolution by ensuring the process is done correctly.
Can You Sell Your Business Instead of Dissolving It?
If you intend to stop operations, you may sell your business in Massachusetts instead of dissolving it. However, chances are you will face a host of legal issues that will necessitate great attention to detail. It’s wise to have the business lawyers at Calabrese Law Associates advising you on how to set up the sale, what documentation is needed to facilitate the sale, and what the legal risks of your decision might be. Our firm takes the time to ensure its clients understand the entire business dissolution and sale process.
Steps you may need to take before the business sale or dissolution include:
- Securing a business valuation.
- Creating a list of what will and will not be sold with the business, such as equipment.
- Checking on potential buyers’ financial solvency and business history.
- Ensuring the buyer has the right financing to close the deal.
- Preparing bills of sale or assignment of lease documents.
The firm’s business lawyers help simplify the complicated process of selling and dissolving Massachusetts businesses so that its clients can make the most informed decision possible.
Contact Calabrese Law Associates for a Business Dissolution Attorney in Boston
Calabrese Law Associates offers professional and result-oriented legal services for businesses and organizations in the Greater Boston area. Our well-trained and dedicated team of professionals have years of experience in business law and corporation dissolution and have successfully assisted business owners in closing their businesses successfully. The mission is to deliver expedited and efficient legal services to allow you to conduct your affairs seamlessly. Contact us today to learn more!