If you’ve been toying with the idea of shuttering your business, but haven’t been sure it’s the right thing to do, this post should help you make that decision. And it’s an important one to make now: putting it off until next year could cost you penalties and fees.
If any of these signs get you nodding your head, it may be time to close that business before 2014 is over.
1. You’re Not Making Enough to Pay Your Bills
It’s one thing to have a slow month. It’s another for you to consistently not make enough to cover your own expenses. If you look back over the past several months and see a pattern, something’s got to change. If you’ve tried everything you can to get your business to pick up and you still haven’t seen results, it might be time to throw in the towel.
2. Running Your Business Has Become a Chore
While you don’t have to leap out of bed singing with the birds every day, excited to go to work, in general, you should be happy as a business owner. If it’s become a slog and you’ve forgotten why you started your business in the first place, here’s hoping it’s something a little R & R can fix. If not, consider what your next move will be.
3. Your Customers are Running for the Hills
Maybe that’s because your product is inferior. Or too expensive. Or someone else is delivering it better than you. Whatever the reason, you’ll have to fight tooth and nail to win them back. If that’s more challenge than you want, bow out gracefully.
4. The Market Has Changed
Think about companies who made records back in the day. Once cassette tapes took over, their businesses became obsolete. If your industry is experiencing giant shifts like this, you can either pivot and offer a new product better targeting your audience or move on to something else.
How to Close Your Business Without Penalties
As long as you properly dissolve your business before 2015, you won’t have to pay fees on your business for next year. First, file your Articles of Dissolution with the Secretary of State’s office in the state where your LLC/Corp was formed. Then, make sure you pay off any outstanding debts or invoices with your vendors.
After that, you can close your federal and state tax accounts and close your EIN so the IRS doesn’t continue to try to tax you. For any business licenses or permits, contact your local government and let them know you’re dissolving the business.
And don’t forget to let your customers and vendors know! It’s important to take care of all these steps to avoid having to spend more money on the business that you have closed out.