Q: I’ve decided to close my business, what steps do I need to take?

A: Making the decision to close down a business is not an easy one. The steps necessary will depend on what legal form of business you have and how many employees are impacted. The Small Business Administration recommends enlisting professional help from an accountant and an attorney to close partnerships, limited liability companies or corporations. At a minimum, check with the Internal Revenue Service about the steps necessary to file all final tax paperwork. Check online at http://1.usa.gov/1lDxhdV for forms and a checklist for closing a business. Other professionals who could be helpful include a business broker, banker or counselor from the Small Business Development Center.

For any business other than a sole proprietorship, you will need to vote to close the business. Follow the procedures in your organizational documents or follow the rules available on the Oregon Secretary of State website at http://1.usa.gov/1lDxmy7. If you do not file the legal forms to dissolve an LLC or corporation, you will continue to be liable for taxes and business filings.

Cancel all business registrations, permits, licenses and assumed business names with the state of Oregon. Ensure that all final paychecks are paid to employees and that all payroll taxes are paid. Also, you will need to issue final W-2 forms and payroll tax reports. Be aware of all laws protecting employees and provide adequate notice to employees of the impending closure of the business. Check with the local employment office to see what needs to be done. File final tax returns and check the box that indicates this is a final business tax return. Many business records must be retained for 3-7 years after the closure of a business. Store the paperwork so it’s easy to find if necessary.

Notify all lenders and creditors that the business is closing and settle any remaining debt. If you are unable to pay your business debts, you may want to talk over bankruptcy options with your attorney. Contact customers and business associates about the closure of the business. Make arrangements to collect any unpaid customer bills. Close the business bank account once all financial transactions have been settled. Notify insurance carriers and make sure you are covered for any unforeseen business issues.

Closing a business is a process that may take some time. Develop a plan that will allow you to move forward in a positive way.

Arlene M. Soto is the director of the SWOCC Small Business Development Center, www.BizCenter.org. She can be reached at 541-756-6445, asoto@socc.edu, or at 2455 Maple Leaf, North Bend, OR 97459.