Many businesses are closing their doors in these unstable and tough economic times. While Pennsylvania residents may want to quickly close the doors of their financially strained business, it is important to make sure all the formalities are completed and dealt with properly.
The first step for dissolving a company is filing the necessary paperwork. Either the owners or the board of directors, depending on the type of company, will make a resolution to dissolve. Then these must be filed with the secretary of state’s office in Pennsylvania. This serves as the official legal notice that the company is closing its doors.
Any property that is not being used as collateral for loans will be sold. Those that being used as security for loans have to either go to the institution that holds the loan or paid off before it can be sold. How much property is available for liquidation depends on the company’s financial situation.
All outstanding liabilities have to be sold before the company can be dissolved. This includes short or long-term debts and any products or services that were already sold but not delivered. All tax forms, state and federal, have to be filed. Whatever cash value in the business remains is distributed to either the owner or the shareholders.
Once these steps and all other formalities are completed, a final legal notice is sent to any company or entity that would have an interest in the dissolving company. This includes but is not limited to employees and shareholders.
Individual requirements for company dissolutions vary from state to state, which is why it is beneficial to consult an experienced attorney for guidance on how to proceed.