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Is it time to dissolve your partnership?

On Behalf of | Sep 24, 2023 | Business Disputes

When you and your colleague formed a partnership, you likely had the same vision and goals for your business. Things were going well for a while, and you were enjoying success.

But people change, and it may be that you and your partner no longer see eye-to-eye. Now you’re wondering if it may be time to make some changes.

Signs your partnership is no longer working

  1. You have different visions of the direction the company should go.
  2. Your partner is making risky decisions that could negatively impact the company.
  3. There is no longer clear communication, creating tension and misunderstanding.
  4. You and your partner are not equally investing your time and money.
  5. Your partner consistently fails to follow through with commitments.
  6. You no longer trust or respect your partner.

If you recognize any of these signs, you may want to consider ending your partnership. If so, here are some guidelines:

  • Review your partnership agreement to see if there is anything regarding dissolving the partnership, the division of assets and liabilities, and any other details. 
  • You may want to discuss your intentions with your partner. Try to refrain from becoming emotional and remain professional. 
  • Consider the financial and tax implications of the dissolution and any future obligations. 
  • Be sure to document all conversations and actions throughout the process.
  • Inform your clients, vendors, employees, and other parties regarding the change.

Dissolving a partnership can be a difficult process. It’s important to seek help from someone who can help you understand your rights and obligations and ensure that you are in compliance with state and federal laws.