If you’re taking over a business from an existing owner, transitioning its ownership is the selling process’s final phase. You have closed the deal, the sale and purchase agreement is now signed, and the purchase price has been paid to the seller by the buyer. The last step is to complete the final few actions.
What Must Be Transferred To New Owners Once The Business Has Been Sold?
The previous owner must give their successor all key information that they will need to run their business. This includes:
- Safe combinations
- Alarm codes
- Software, online access, and computer passwords and codes
- Client list
- The keys for the filing cabinets, vehicles, and buildings
- Personal contact details
- Manuals for the equipment
- Distributor, vendor and supplier lists
Must The Business Entity Be Dissolved Following The Sale?
Any business structured as an LLC or corporation must be dissolved. This can be done by meeting with the partners or board members and passing a resolution to dissolve the business. The IRS must be notified via form 966, and Articles of Dissolution must be filed with the state in which the business was set up.
Taking Professional Advice
It’s important to take professional advice about how to proceed with the closure or transfer of a business. Professional consultants can advise about these steps, but take care to choose a team with extensive skill and experience in the industry. If you read Corporate Business Solutions reviews, you’ll see how important it is to choose the right business analysts who can offer you the vital advice that you need at this key stage of transferring a business.
Which Other Steps Must Be Taken To Close Or Transfer The Business?
An attorney will also be required to cease the operations of the business. Any business which was established as a sole proprietorship will automatically close after the completion of these steps:
- All contacts for every contract assumed or assigned by the buyer must be notified
- All creditors must be notified to explain the way in which bills will be settled
- All business licenses or permits will be canceled along with other registrations and assumed business names
- Cancellation notice must be given on the lease
- Any insurance policies which aren’t being taken over by the buyer must be canceled
- All bills must be paid off and all amounts receivable that aren’t being taken over by the buyer must be collected
- All remaining assets must be distributed after the closure of the sale
- The Employer ID number must be closed with the IRS
- The business’s lines of credit must be closed
- Final wages must be paid to employees together with payroll fees and taxes
- All necessary tax forms must be filed
Completing The Post-Closing Process
With help from your broker, attorney and business consultant, you should have plenty of guidance to get you through the post-closing final process. Once all of these steps are complete, the deal is finalized. The employees can now be notified together with suppliers, customers, and the public. You’ll now be ready to move forward with your new venture.