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Reasons to send out notices of dissolution

On Behalf of | Aug 23, 2021 | Uncategorized |

When you are in the middle of dividing up your business assets between yourself and one or more partners, you should be careful not to neglect certain steps that are necessary to dissolve your business. Ending a business can be a stressful time. You should know that you have completed all the necessary motions so you do not run into trouble later on.

Chron explains that if your business is coming to an end, you should consider preparing a notice of dissolution. Company owners send these notices to certain parties to let them know about the impending end of their business. There are a number of reasons this action may be of benefit.

Receive notification of claims

As you wind down your business, you should consider settling your remaining business debts. You should not have to worry about creditors trying to collect from you even after you have finished dissolving your business. By sending out a notice of dissolution to people you owe money to, you can invite them to send you notices of any claims they have against your company.

You might also consider creating a general notice and posting it for the public to see. This may attract the notice of creditors that you may not know about. This way, both you and your co-owners can deal with these unknown claims before you end your business.

Prevent further debts

You have probably set up ongoing orders with suppliers to provide you with inventory or other items important to your business. If you dissolve your company, there is no need for these suppliers to continue producing orders for you and increase your debt. If you send a notice of dissolution to your suppliers, you may stop a further accumulation of expenses.

Even if you think your partner or co-owners will take care of drafting dissolution notices, you should still check upon them to make sure they follow through. If not, you may need to take charge of creating the notices. It may save you some trouble later on and release you from further obligations stemming from your old enterprise.