I would like to dissolve a California business partnership between myself and my son. What steps do we take and what forms and announcements do we need to comply with?
A. Partnership dissolution: Whether you or your son will continue operating the business or the business is also being discontinued is one important consideration; however, partners have several important considerations regarding dissolution, including a predetermined formula or appraisal method for valuing the business in a buyout by another partner, the valuation and transfer of any business name, trademarks, or other intellectual properties, potential payment arrangements in a buyout, selection of an arbitrator or other method to handle legal disputes, and liability indemnification for a departing partner.
– Notify state and federal tax authorities that the partnership is dissolving
– Turn in a dissolution and liquidation form to the state in which you do business (this is not always required but is always a good precaution to take)
– Notify all creditors that the partners are no longer responsible for the debts of the others
– Notify all suppliers, customers, and clients of the dissolution
- Dissolving a General Partnership: legalmatch.com
- Partnership Dissolution Agreement & Guide: legalzoom.com
- Ending the Business Marriage- Dissolving the Partnership: rhlaw.com (references California law but still contains useful advice)
- Partnership Dissolution Agreement: scribd.com
- Partnership Dissolution Agreement: printablecontracts.com
- Partnership Agreements: legaldocs.com
- Partnership Dissolution Agreement: biztree.com
- Sample Business Contracts: contracts.onecle.com
Links and references to sample and template documents have been provided pursuant to your request. Templates and sample documents can be very useful but businesses should exercise caution in the use of such documents. Understand that not all templates are created equal, with many being created for a narrow set of requirements. A particular template will not be warranted to cover every provision that may be required by a particular set of business circumstances. Studying the language included in various samples and templates will improve your level of understanding related to the subject of your particular agreement and may help you articulate your business objectives related to an agreement, but be aware that many, perhaps most, agreements should be prepared by your lawyer to provide greater assurance that your interests have been protected.
See section 1.708-1(b) of the regulations for more information on the termination of a partnership. For special rules that apply to a merger, consolidation, or division of a partnership, see sections 1.708-1(c) and 1.708-1(d) of the regulations.