Frequently Asked Questions

What plans are needed to assure the business continues upon the death or disability of the owner?
You must make sure the business continues even if you don't. Key issues are: loss of your talent, continuity of ownership, loss of employees and customers and loss of financial resources. For more information request the Business Continuity white paper.

In thinking about transitioning out of my business, does it make a difference what entity form my business is?
Your entity should be a pass through tax entity, such as an S corp., LLC, partnership or proprietorship. For more information request the C vs. S Corporation white paper.

How do I motivate my employees to stay while I'm selling my business?
There are ways to handcuff employees, while at the same time increasing the value of the business. For more information request the Employee Incentive Planning white paper.

Will an ESOP work for me?
ESOPs are not for everyone, but they do offer some excellent tax advantages in exiting your business, every business owner should consider if an ESOP is right for him or her. For more information request the ESOP Opportunities white paper. This white paper uses a fictional business owner to illustrate how an owner can use an ESOP.

What are the ways I can transition out of my company?
When owners think about exiting their companies, the number of exit routes might seem unending. In fact, there are only eight. For more information request the Exit Routes white paper.

I know it is inevitable that I will no longer own my business at some point. What are the steps I should take now to plan for that ultimate event?
At some point, every privately held business owner will transition out of his or her business. The sooner one plans for that inevitable event, the more flexibility there is to meet the owner's lifestyle goals and the more tax efficiency can be built in. There are seven steps in the planning process. For more information request the Inevitabilities white paper.

Should I use an intermediary to help sell my business?
Lawyers don't try their own cases; surgeons don't operate on themselves and you shouldn't try to sell your business yourself. You may be expert in selling your product or service, but most business owners have never sold a business. A qualified intermediary, will save you countless time, get the best price and lead you through the process of selling to a third party outsider - or even to an insider. The intermediary, with his or her knowledge of the market will make sure you don't leave money on the table. For more information request the Intermediary white paper.

What are some of the common mistakes sellers of businesses make?
Ten of the common mistakes are:
1. No firm decision to sell
2. Sale timing not right
3. Inadequate financial records
4. Wrong price
5. No business plan
6. Not qualifying buyers
7. Selling to the wrong buyer
8. Demanding all cash
9. Failure to train your replacement
10. Trying to sell it yourself

For information on what to do about these mistakes, request the Mistakes white paper.

How do I transfer my company to my key employees in a tax efficient way?
You can transfer your company to key employees without the double taxation, but it takes long term planning. You can even use some one else's money. For more information request the Transferring Your Company To Key Employees white paper.

What short terms incentives can I use for key employees?
Keeping key employees is absolutely critical, if the business is to be sold at the highest possible price. For more information request the Using Short Term Key Employee Incentives To Increase The Price white paper.

What do buyers look for in valuing a business?
There are certain value drivers that buyers look for in every business: a stable management team, sustainability of cash flows with defined operating systems, a solid diversified customer base, facility appearance consistent with asking price, realistic growth strategy, effective financial controls and a good and improving cash flow. For an in-depth discussion on value drivers, request the Value Drivers white paper.

How do I transfer my business to my children efficiently?
Successful business owners often wrestle with the issue of how to pass wealth to children in a way that minimizes - legitimately - their tax bills. For more information on the subject, request the Transferring Wealth to Children - A Primer for Business Owners white paper.

Circular 230 Disclosure: Pursuant to recently-enacted U.S. Treasury Department Regulations, we are now required to advise you that, unless otherwise expressly indicated, any federal tax advice contained in this communication, including attachments and enclosures, is not intended or written to be used, and may not be used, for the purpose of:
i.Avoiding tax-related penalties under the Internal Revenue Code or
ii.Promoting, marketing or recommending to another party any tax-related matters addressed herein.