Legal Question in Business Law in Washington

Whether you can either dissolve the business or declare bankruptcy for it and still protect your personal assets depends on many things. Most important, have you been observing "corporate formalities". I know you have an LLC, not a corporation, but that refers to the general practice of keeping company business and personal business separate, and conducting the company as a company. For example, have you refrained from paying your personal bills with company funds? Have you refrained from paying yourselves distributions when the company did not have enough money to meet expenses? Do you have an operating agreement and have you been following its provisions? Another important question is whether you have personally guaranteed any of the debts that are in the company name.

As to whether you can or should start a new company, there is no rule that says that if your entity (LLC, corporation or whatever) is bankrupt or dissolved that you can't start another one. The tricky question is whether the new company is really a successor to the old one. If, for example, your current business is pet grooming, and you decide to shut the business and open a new one as a party planner, you should have no problem. However, if you shut the pet grooming business and two weeks later open a new pet grooming business, having purchased your equipment from the old business for $10, and having contacted all your regular customers and told them "we've changed our name", you will definitely have a problem.

All the above is to explain why my real advice is, you have a lot of "if...then..." parts to your situation. You should probably spend a little time with an attorney, discuss all the details, and get advice that is focused on your situation.