Business Sale Lawyer Connecticut

If you are planning on selling your business, you may want to consult a business sale lawyer Connecticut residents trust. Selling a business can be quite complicated, and you want a knowledgeable and experienced lawyer from Eric Lindh Foster Law, LLC on your side. Here are some common mistakes to avoid when selling your company.

Not Fixing Up Your Business Beforehand

Just like you might spruce your home before putting it up for sale, it may also be wise to fix up your business before selling it. After all, you want to make your company as attractive as possible to prospective buyers. For instance, you may want to reduce personal expenses through the company, as they can lower your company’s earnings. You may also want to take a look at your current staff members. They should be able to effectively run the business without you.

Making the Sale of Your Business Too Public

At first, it might not seem like a big deal to advertise to the public that you are selling your business. However, this can actually make it more difficult to sell your company. If your customers find out that you are selling your business, they may worry that you won’t deliver your goods or services. That is why you should be a little more discreet. An experienced broker will be cautious when selling your business by not identifying the name of your business.

Failing to Tell the Truth About Your Business

While you want to make your business look attractive to buyers, you should not misrepresent anything about your company. For instance, a Connecticut business sale lawyer would advise you against inflating your company’s sales to prospective buyers. Likewise, you want to be honest about any pending litigation, taxes and formation of your company.

Neglecting to Value Your Business

Before you put your business up for sale, you will want to conduct a proper valuation of your business. Otherwise, you might have trouble selling your company as quickly as you would like. If you set your price too low, for example, buyers might think that there is an issue with your business. If you price your business too high, not many people will want to buy it either.

Having Your Broker Do All the Work

When many business owners put their company up for sale, they expect their broker to do all the work. While a reputable broker will work hard to effectively market your business, you too have to stay engaged in the selling process. You know your business better than anyone, so you can convince buyers to purchase it. Ask your broker how you can help in marketing your business.

If you need help selling your business, you may want to speak with a Connecticut business sale lawyer from Eric Lindh Foster Law, LLC.

Legal Structures To Consider For Your Business

Choosing the right legal structure is one of the most important decisions we make when starting a business. The structure we choose impacts our taxes, liability, and management responsibilities. It’s essential to understand the options available so we can select the structure that aligns with our business goals and needs. At Eric Lindh Foster Law, LLC, we’ve helped businesses across Connecticut make informed decisions about their legal structure, whether starting fresh or preparing for a potential business sale.

Here are the most common legal structures to consider as evidenced from a Connecticut business sale lawyer:

1. Sole Proprietorship

A sole proprietorship is the simplest legal structure, where the business is owned and operated by one person. This structure is easy to set up, with minimal costs and paperwork. However, it does not provide liability protection, meaning we are personally responsible for all business debts and obligations.

This structure works well for small, low-risk businesses, but it may not be the best choice if we plan to grow or attract investors.

2. Partnership

A partnership involves two or more people who share ownership of a business. Partnerships come in two main types: general partnerships, where all partners share liability and management, and limited partnerships, where one partner has limited liability and a more passive role.

Partnerships are relatively easy to set up, and profits flow directly to the partners’ tax returns. However, clear agreements about roles, responsibilities, and profit sharing are crucial to avoid disputes.

3. Limited Liability Company (LLC)

An LLC combines the liability protection of a corporation with the tax flexibility of a sole proprietorship or partnership. It’s a popular choice for many businesses because it limits our personal liability while allowing profits to pass through to our personal tax returns.

LLCs also offer flexibility in management structure and fewer formalities compared to corporations. This structure is a great option if we’re planning to protect our personal assets while retaining a straightforward operational model.

4. Corporation

A corporation is a more complex legal structure that creates a separate legal entity for the business. This provides the strongest liability protection but comes with more regulatory requirements and formalities.

Corporations are ideal for businesses looking to raise capital by issuing stock or preparing for a future sale. There are two main types: C corporations, which are taxed separately from their owners, and S corporations, which allow profits to pass through to shareholders’ personal tax returns.

5. Nonprofit Organization

If our goal is to operate a business focused on charitable, educational, or social causes, forming a nonprofit organization may be the best option. Nonprofits are eligible for tax-exempt status, but they must adhere to strict regulations and use their profits for their stated mission.

This structure is ideal for organizations looking to serve the community without prioritizing personal profit. Your Connecticut business sale lawyer can assist.

6. Cooperative

A cooperative is a business owned and operated by the people who use its services. Members share decision-making authority and profits. While less common, this structure works well for businesses such as credit unions, agricultural ventures, or housing cooperatives.

Our Firm Is Here To Assist

Selecting the right legal structure is a critical step in building a successful business. Each option has its benefits and challenges, so it’s important to consider your goals and plans for the future. If you’re in Connecticut and need guidance on choosing a legal structure or preparing your business for sale, reach out to Eric Lindh Foster Law, LLC. Contact a trusted Connecticut business sale lawyer today to ensure your business starts on a solid foundation and has the tools for long-term success.