Key Tips for Buying a Business

Buying a business is something many people may consider, especially those who are retired or seeking a new career. Entrepreneurs may also be faced with tough decisions like whether or not to buy a business. There are some important considerations that should be taken into account when planning to launch a venture. Here are some key tips to successfully buying a business.


Should You Buy a Business?

You want to be certain that this business venture is right for you. After conducting some research, you may find that starting a business is very risky. You may also find that a more established entity may be a better investment for you. Being able to work with a tested model can make a difference when gauging the potential success of a business. Consulting with a business lawyer for guidance could be extremely beneficial because he or she can provide insight useful in determining the purchase and purchase process of a business.


Are the business opportunities perfectly aligned with you and the market?

You should be familiar with the industry on some level to maximize your chances of success in operating your business. Sites like BizBuySell are great resources to start your search efforts. Keeping up with trends in the industry is crucial; you wouldn’t want to buy a business that makes typewriters because the market is saturated with much newer technologies. By making certain that your potential investment makes sense for the current environment and demand of the business, you won’t be in a position where you are purchasing a company that isn’t likely to be a lucrative investment.


The company’s history is also important.

Having basic information like the owner history and how much time it has been spent in business is necessary to attain a full understanding of the company. The state is also a valuable resource for researching a business, and information recorded is likely accessible to the public. Available public records can be instrumental in providing you with this information.


Consider financing at this stage.

A business up for sale may provide limited assistance with financing options. Local banks and credit unions may be able to provide you with the necessary assistance required to acquire a business. There are also federal grants that provide conditional financing assistance for prospective business owners. Attorneys like John McDuff can assist with determining the method of financing for your acquisition, as well as with tax planning counsel to minimize your tax hit.


What are you getting in the purchase?

An itemized list will give you a clear picture of what will you will be getting when acquiring a business. There may intellectual property concerns such as trade secrets that need to be considered. You may not be entitled to the name of certain patents when acquiring a business, so you definitely need to make sure that your transaction is backed by an itemized list.


Buying a business takes preparation and a lot of research.

The most important tool when preparing to acquire a business is information. The more information you have available to you, the better your chances are of buying the right, lucrative business. Buying a company can be a good alternative to launching a business in many cases. When you are considering buying or selling a business, consult with an experienced business attorney to facilitate the process and help you plan the best course of action.

The Taxpayers Bill of Rights

Getting your taxes done can be, well, a very taxing job. For many Americans, there is plenty of frustration trying to understand, digest and then comply with the rules and regulations that govern the US tax code. In part, tax-season stress is due to the fact that the tax compliance is so incredibly complex. But beyond that headache and frustration, many taxpayers have an outright fear that they will be hassled and audited by the IRS. They are afraid to do their own taxes for fear of getting in hot water with the government. They are afraid that they may even end up in court!

Do US taxpayers have any remedy for this beyond the due-diligence of honestly and accurately filing the forms that are required?

TBOR, The Taxpayer Bill of Rights

Fortunately, Congress has made some progress in quelling taxpayers’ fears. They established The Taxpayer Bill of Rights, or TBOR for short. In summary, it provides guidelines so that taxpayers are treated fairly and respectfully in all their interactions with the Internal Revenue Service.

Ten basic taxpayer rights are incorporated in TBOR:

  • The Right to Be Informed
  • The Right to Be Informed
  • The Right to Pay No More than the Correct Amount of Tax
  • The Right to Challenge the IRS’s Position and Be Heard
  • The Right to Appeal an IRS Decision in an Independent Forum
  • The Right to Finality
  • The Right to Privacy
  • The Right to Confidentiality
  • The Right to Retain Representation
  • The Right to a Fair and Just Tax System

Although many of these appear self-explanatory, a few additional words might be helpful:
These rights were established by Congress to cover each and every taxpayer. By the Right to Quality Service, TBOR means the “right to receive prompt, courteous, and professional assistance in their dealings with the IRS, to be spoken to in a way they can easily understand, to receive clear and easily understandable communications from the IRS, and to speak to a supervisor about inadequate service”. Additionally, The Right to Retain Representation means “the right to retain an authorized representative of their choice to represent them in their dealings with the IRS.

When to Bring in Legal Counsel

Given the incredible complexity of the US tax system, it is inevitable, despite the TBOR, that disagreements and disputes with the IRS will arise. In some cases, legal counsel of your choice, which is right, may be necessary. Some of the most litigated issues pertaining to tax filing include trade or business expenses, accuracy in filing, gross income, passive activity, and charitable deductions, among many others.

What if you disagree with the IRS? What if you question one or more of the IRS’ conclusions related to a legitimate concern? What if you are audited and disagree with the IRS’ findings. Although you are free to handle such concerns without representation, it may be wise to consider competent, knowledgeable legal counsel. When dealing with the IRS, it pays to have experts in your court.

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