There will be a time in every Massachusetts business owner’s life when leaving his or her company behind is a want/need. Waiting to figure out how to pass on one’s business until the last minute is not the wisest decision. The simple truth of the matter is, the process of changing company ownership can be complicated.
When passing a business to another person, the new owner needs to be named, and the old owner removed. This is done by restructuring the company. Along with naming the new owner, new business documents need to be filed with the state and the Internal Revenue Service. The business itself may not change much, but in the eyes of the government, changing business ownership creates a new business entity.
After officially creating the new company, assets and liabilities can be transferred to the new owner. Agreements with any vendors or suppliers then need to be changed or, if desired, canceled. Property leases, if applicable, must be modified. Finally, state licenses and permits must be obtained by the new owner.
Passing on one’s business is far more involved than just naming a successor. Without careful succession planning, walking away when one wants to may not happen as quickly as one would like. Thankfully, company owners in Massachusetts can turn to an experienced attorney who will be able to help them put together succession plans and, when the time comes, put those plans into action. With the right help in one’s corner, the changing of business ownership does not have to be so complicated after all.