Things to Consider when Selling your Business

August 31st, 2015 by Alleen Sakarian

You’ve decided to sell your business. That may well have been a difficult decision. You will need to make a number of other decisions leading up to the sale. Make informed decisions based on solid professional advice.

Consider the following preliminary matters when deciding to sell you business:

1. What are you selling?

If your business is incorporated, you will need to consider whether you wish to sell the corporation’s assets, or your shares in the corporation. Consider the tax consequences of these options. Will the corporation meet the qualifications necessary to allow you to benefit from all or part of your lifetime capital gains exemption? You may discover that you need to implement a pre-closing corporate reorganization.

2. What is the business worth?

Valuing a business can be tricky – especially when dealing with intangible assets such as goodwill. It may be difficult for the buyer and the seller to agree on the value of the business. Consider whether or not to retain the services of a professional valuator to provide an objective determination of the value of your business.

3. Prepare for sale

Involve your professional advisors as early in the process as you possibly can. Basic planning often results in significant tax savings; legal advice will ensure that you are signing clearly-worded, unambiguous documents that accurately reflect the deal terms.

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