Closing A Business In Florida In 5 Steps
Closing a business is always a tough decision no business owner ever wants to make. Deciding to close after spending thousands of dollars and hours of work on a business is hard. Nevertheless, sometimes it is the right decision. When a business stops being profitable, owners often have no choice but to close.
However, closing a business in Florida is not as straightforward as some might think. Much like forming a new business entity, closing a business requires meeting specific requirements and following specific steps.
Here is a five-step breakdown of the process of closing a business in Florida:
Step 1: Call Your Lawyer
The very first person you must tell about your decision to close your business is your business lawyer. You must notify your lawyer as soon as possible and ask as many questions as you need regarding rules specific to your type of business entity for dissolution. For example, businesses with several owners generally need to follow different steps than businesses with a single owner. Depending on your type of business entity, your lawyer will advise you on how to proceed.
Step 2: Hold a Shareholders Meeting
If your company has shareholders, the second step is to hold a meeting and personally notify them of your decision to close the business. In this meeting, the board will typically put the issue up for a vote, giving each shareholder a say about whether or not closing the business is the right choice. This is a crucial step, as you will need the majority of the shareholders to agree with you in order to be able to close the business. However, you must make sure to check your company’s formational documents because they typically contain rules on how to dissolve the company.
Step 3: Find the Right Articles of Dissolution for Your Business
In Florida, the paperwork requirements for dissolution are different for every type of business entity. These documents are called Articles of Dissolution. Once you find the right articles of dissolution for your company, you can either print the forms, fill them out, and mail them, or you can fill them out and submit them online.
If your company has not issued shares or started doing business in Florida, you must use the form conforming to Section 607.1401 of the Florida Statutes. All other businesses must use the form conforming to Section 607.1403 of the Florida Statutes. You can find these forms on the Florida Department of State, Division of Corporations website.
It is indescribably important that you fill out and submit the right papers, which is why it is best to speak with a professional – in this case, your lawyer – who is able to tell you exactly which form to fill out. If you do not have a business lawyer, contact Jurado & Farshchian, P.L. today.
Step 4: Notify Vendors, Creditors, and Employees
In a situation involving insolvency, the owners of a company usually sell business assets to cover debts. You must notify your vendors and clients and make the necessary arrangements to complete all contracts and pay all outstanding invoices, fees, and sales taxes. You must also cancel all business credit cards, close all business bank accounts, and terminate all lease agreements. Additionally, you must make sure to properly and promptly notify your employees that you will be closing the business.
Step 5: Pay the Filing Fee
Once you have filled out the correct form and gathered any additional paperwork, you will be ready to take the final step, paying the filing fee. Luckily, you can do this online, through the Florida Department of State, Division of Corporations website.
Closing a Business in Florida? Need Help? Contact Jurado & Farshchian, P.L.
If you have made the decision of closing your business, you should do it the right way. Our qualified business attorneys are happy to answer any questions you may have about the process of closing a business in Florida and would be glad to help you navigate it.
Give us a call today at (305) 921-0440 or send us an email to [email protected] to get started.
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