What is the best way to transfer my small business to my son?
April 17th, 2009
johndmershon asked:
I want to give my son my business without charging him any upfront money. I would like to pull a small income from the business each month as a retirement. I dont want a share in the business just a guaranteed payment each month. I have been in business since 1983 and have annual average revenue of $225,000. My son has been working with me now for the past 8 years and has shown great leadership skills.
I am concerned about things like tax ramifications of not handling this properly. Our business isnt incorporated instead it is a sole proprietorship. Would it be better to incorporate and retain a share of the business while giving my son the majority? Also I have a house for sale currently but it is pre foreslosure. I have a buyer lined up and we are in the midst of negotiating the home sale. If the house were to fully be foreclosed would this affect the business and perhaps even void the business sale?
Thank you for any honest advice.
Alberto
I want to give my son my business without charging him any upfront money. I would like to pull a small income from the business each month as a retirement. I dont want a share in the business just a guaranteed payment each month. I have been in business since 1983 and have annual average revenue of $225,000. My son has been working with me now for the past 8 years and has shown great leadership skills.
I am concerned about things like tax ramifications of not handling this properly. Our business isnt incorporated instead it is a sole proprietorship. Would it be better to incorporate and retain a share of the business while giving my son the majority? Also I have a house for sale currently but it is pre foreslosure. I have a buyer lined up and we are in the midst of negotiating the home sale. If the house were to fully be foreclosed would this affect the business and perhaps even void the business sale?
Thank you for any honest advice.
Alberto
Talk to you accountant for the tax implications.
Business attorneythis should at some point have had to consult with anything if you dont have had to consult with cpa and small business attorneythis should be able to consult with cpa and small business then you believe the company doesnt make any money your attorney if you dont have.