Advantages of Incorporating (Series #2 out of 7) - Easier to Sell / Transfer

Advantages of Incorporating (Series #2 out of 7)

2.- Easier to Transfer / Sell. Corporations are generally much easier to transfer / sell and are usually more attractive to buyers than either a sole proprietorship or partnership.

One of the reason for this is because a new buyer will not be personally liable for any wrongdoings on the part of the previous owners. The liability stops with the corporation if the corporation is properly set up and run.

If someone buys a sole proprietorship, for example, the new owner can be held personally liable for any mistakes or illegalities on the part of the prior owner…even if the new owner had NOTHING to do with the situation! This is usually NOT the case with a corporation.

Further, many corporation owners (shareholders)do Estate Tax planning and succession planning through corporations buy gifting shares to children, or giving children or key employees stock as an incentive to continue with the business.

The transfer or sale of a corporation involves the transfer or sale of stock and generally does not require re-titling of assest, contracts, etc. that are in the corporations name. With sole proprietorships it is much more difficult since all assets of a sole proprietorship are in the owners name.

For more information give our office a call at (800) 530-4529, or check out further information on our website - www.dalexander.com

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