When starting a business and selecting your entity choice and business structure, the furthest thing from your mind may be the dissolution of your business. However, sudden deaths, health complications, and other things come up that may stop your business in its tracks. If you want your company to continue to exist when you pass away or decide to step away, you need to learn about the different business entity choices and how they can affect the continuity of existence:

• General Partnerships – if one business owner dies or withdraws, the partnership will generally dissolve. However, if there is an agreement in the partnership articles, it may allow for the continuation of the business in which a new partner can buy the old partner out to carry on the business.
• Limited Partnerships – most state laws allow a limited partner to assign his or her interest to another person without dissolving the partnership; however, if a general partner withdraws, there needs to be one other general partner left, and the remaining partners agree in writing within 90 days to continue the business. If not, the limited partnership will be dissolved.
• LLC – in a limited liability company, the LLC will dissolve upon any member’s retirement, death, or resignation, unless other members agree to continue the entity.
• Corporation – if continuity is wanted, a corporation is the best business entity choice that can continue the company, even if one of its shareholders dies or withdraws. 

Depending on what you want, in regard to the continuity of existence, may determine which business entity structure you choose when forming your company. A corporation can allow for the continuation, whereas a partnership is limited by the other partners, certain provisions, and terms.

For help determining the best business entity choice for your needs, call an Austin business entity attorney at the Posey Law Firm today at 888.269.1962 or 512-646-0828 to find out which business structure is best for you.