Business partnerships don’t always work out as planned, and sometimes it becomes necessary to dissolve the partnership. If you find yourself in this situation, it’s important to understand the legal requirements for dissolving a partnership in Indiana.
According to Indiana law, there are two types of partnerships: general partnerships and limited partnerships. The dissolution process for each type of partnership is slightly different, so it’s important to know which type you have.
General partnerships are formed when two or more individuals or businesses agree to work together to run a business. In a general partnership, all partners are personally liable for the debts and obligations of the partnership. If you’re a general partner in Indiana, you can dissolve the partnership by unanimous agreement of all the partners or by the withdrawal of a partner.
If you’re a limited partner in Indiana, you have a more passive role in the partnership and are not personally liable for the partnership’s debts. Limited partnerships are formed by filing a certificate of limited partnership with the Secretary of State. To dissolve a limited partnership in Indiana, you must file a certificate of dissolution with the Secretary of State.
Regardless of which type of partnership you have, there are a few other things you’ll need to consider when dissolving a partnership in Indiana.
First, you’ll need to settle any outstanding debts and obligations. This may include paying off loans, settling accounts with suppliers, and paying any outstanding taxes. It’s important to make sure all debts are paid in full before dissolving the partnership, as the partners may be personally liable for any unpaid debts.
Next, you’ll need to divide any remaining assets among the partners. In general, the assets of a partnership are divided based on the terms of the partnership agreement or, if there is no agreement, based on the contributions of each partner.
Finally, you’ll need to inform any relevant parties of the dissolution. This may include customers, suppliers, and other business partners. You’ll also need to update any licenses or permits to reflect the change in ownership.
Dissolving a partnership can be a complex process. Contact an experienced attorney at Frangos Legal LLC if you would like to discuss your options when dissolving a partnership. Schedule a consultation and case review by emailing us at [email protected], by telephone at 317-643-1345, or by booking online.