12 Apr How to permanently close a business in N.J.

Q. When a small business owner closes a business and stops all operations for retirement, are there any continuing state or federal reporting requirements? What needs to be done to close the books?
— Getting ready

A. Congratulations on your retirement.

The specifics of what a business has to do depends in large part on the type of corporation and the number of employees.

“The corporation should be wound up, adopt a plan of dissolution, pay or make provision for payment of creditors, obtain a tax clearance certificate from the state, file ‘final’ tax returns, withdraw from other states in which it has qualified to do business, and dissolve,” said Stuart Pachman, an attorney with Brach Eichler in Roseland. “Purchasing `tail’ insurance should be considered.”

So-called tail coverage is a one-time purchase, won’t expire and would give you extra coverage in case someone comes forward after your company is closed.

You can read more about closing a business from the state website here and here.

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This story was originally published on April 12, 2019.

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