Steps to Selling Your Parent’s Business After Their Death
If one of your parent’s has recently passed away, you may be searching for information on how to sell your parent’s business. For a fuss free guide to successfully selling your parent’s business after their death, simply continue reading.
How to sell your parent’s business after their death:
- Find out what type of business, your parent ran
It’s important to find out whether your parent’s business was classified as a sole proprietorship, a corporation, a partnership or a limited liability company. As the steps you’ll need to take in order to sell your late parent’s business, will differ, depending on the type of business, that they ran.
- Find out what you’re entitled to
As an example, if your parent was the sole owner of a sole proprietorship, your parent’s estate will liquidate any of your parent’s business’ assets, if there are any outstanding debts owing. Whatever is left, will be distributed according to your parent’s will. If your late parent did not have a will, their estate will be left to their spouse. If your late parent wasn’t married, their estate will be shared amongst yourself and any siblings you may have.
Whilst if your parent’s business was classed as a corporation, your parent’s estate would take control of their portion of the company’s shares. If your parent’s will named you as the sole recipient of your parent’s shares, you’ll be able to go about selling some or all of your shares.
Lastly, if your late parent owned a limited liability company, it’s important to read your parent’s business’s operating agreement. Their operating agreement will specify whether or not an heir has been chosen to continue managing their business. If you have been named as an heir of a limited liability company, you’ll have the right to manage your parent’s company or to sell your parent’s company.
- Book a meeting with an experienced business attorney
Once you’re aware of the type of business which you’re dealing with and your stake in the business, it’s important to talk to a lawyer as they’ll be able to assist you with potential liability issues. As a bonus, a qualified lawyer, will also be able to talk to you about your tax obligations. Why not learn more about what a lawyer can do for you?
- Find a potential buyer or buyers for your parent’s business
If your parent owned the majority of shares in a corporation, you may be able to offer your shares to the public or to one of the corporation’s major shareholders. In fact, you shouldn’t have any trouble, getting rid of unwanted shares. Just ensure that you know the real worth of your shares, before signing over your shares to an interested buyer.
Whilst if your parents owned a limited liability company, if you are named as the heir of your late parent’s business, you’ll be able to sell your new business in its entirety to an interested party. As an example, your business’ competitors may be interested in buying your business out. Alternatively, you may want to offer your business to a high ranking manger, who has adequate knowledge about the ins and outs of your parent’s business.