Thread: Starting a business questions...

You definitely can't just quit... I tried that once and got stuck with penalties and interest on the penalties. Maybe there was even interest on the interest... I don't know.

How you file taxes depends on which entity type your business is (sole proprietorship, llc, s-corp, c-corp, etc).

If you decide to shut down your business you will have to notify the state you live in (usually the secretary of state) as well as the IRS. There are specific documents you have to file.

Once a business entity selection is made, you can't change it. You have to make a new company and dissolve the old one to change your entity type.

If you move to a different county it's no big deal, but if you move to a different state it's different. You can either register the company to operate in the new state (as a foreign business), or you can dissolve the old company and reregister as a new one. The latter method is recommended, because for purposes of taxes and legal matters, you would have to have an accountant/lawyer familiar with your old state as well as the new one if you use the former method.

I don't see why you cannot setup an LLC down the road.

Originally Posted by lucas

Once a business entity selection is made, you can't change it. You have to make a new company and dissolve the old one to change your entity type.

This is an inaccurate generalization. For the most part, switching between entities can be done. There is a process involved, but it is possible.