Spooky Business Sales Situations Part 1 of 3
Business Buyer Beware. There is no more appropriate time to share Spooky stories than Halloween time. Buyers beware of what lurks in the business's closet. First Choice Business Brokers has had the sad experience of hearing horror stories from Buyers who purchased a business without a Business Broker to help facilitate the process. Those buyers found out too late that they purchased a business in good faith from a seller that seemed a "friend" to find that when they applied for their sales tax permit to the state that there was almost more owing in sales tax to the state than what they paid for the business. The seller had clearly not paid their sales tax for a very long time. True story? Yes it is. A buyer of an independent Juice Bar paid approximately $80,000 for the Juice Bar and the seller owed $60,000 in unpaid sales tax and penalties. Certain states have a "tax successor liability law" which means YOU as a buyer could be liable for the sellers taxes if you aren't careful. Make sure to seek a professional Business Broker's assistance, we don't want to hear your horror story around our next campfire.
Linda Hentges-Nyman – October 23, 2017