How Do You Close A Sole Proprietorship?
Closing a sole proprietorship business is much less complicated than closing down a corporation, Limited Liability Company, partnership or other more formal business entity. The business activities are reported on an individual tax return (form 1040), and it is the personally owned business of an individual or a married couple. It is the only type of business entity that does not require a separate business income tax return. These are the things to consider when closing a sole proprietorship. Stop filing a Schedule C after the last year in business. There is no need to mark the Schedule C as a final schedule. This is all that’s required by the IRS for the personal income tax return. File any federal, state and local payroll tax returns if there are employees other than the sole proprietor. These must be marked as final in the last year of filing. Notify any business insurance carrier that you are closing the business if you have liability, commercial auto, workers compensation or othe
