Owning a business in Washington can be exciting and rewarding. However, issues might arise that lead to changes. Among those changes, it might be necessary to dissolve a partnership. If your business partnership hasn’t worked out or a partner wants to move on, you can take steps to dissolve the partnership.
Review the partnership agreement
The first part of dissolving a partnership involves reviewing the agreement between you and your partner. Per business law, you will want to make sure that all of the criteria involved in ending the partnership are clearly understood. There is usually a requirement for going this route.
Talk about the situation
If you have more than one partner, speak with the remaining partners about the situation. They should know what’s going on and why this particular partner wants to leave. There are certain business obligations in place that must be handled, so it’s important that everyone involved understand their role and be aware of how dissolving a partnership can impact those responsibilities.
File the appropriate form for dissolution
When a business partnership is ending, you must file a dissolution of partnership form. This should be sent to the state so that it can be known that you are officially ending the partnership. The form makes it known that the partner who is leaving is no longer liable for any debts that the business amasses or for any other business obligations.
Make sure all parties are notified
All parties having anything to do with the business must be notified of the partnership dissolution. This includes everyone from employees to customers or clients as well as the Internal Revenue Service, the landlord and government entities.
Close business accounts
Business creditors should immediately be notified that the partnership has been dissolved. The partner who is leaving is no longer responsible for debts within the business and should not be contacted regarding those debts. All business-related accounts associated with that person should also be closed.
While deciding to end a business partnership can be difficult, it might be necessary. It’s important to take all these steps to effectively end the partnership.