Selling Your Business in 2012

Is 2012 the Year to Sell my Business?

Taxes on the sale of a business are going up in 2013! The Bush Era tax cuts are due to expire and under the current scenario, taxes on capital gains (your profits from selling) currently at 15% will increase to 20%. In addition, Medicare taxes on individual taxpayers with net investment income in excess of $200,000 are scheduled to increase by 3.8%. For some business owners, this could mean a tax rate of 23.8% on the gains of selling in 2013 as opposed to 15% in 2012. We encourage all business owners to consult with your tax advisor for more information and to see how you and your business will be affected.

There are buyers waiting!  Due to the depressed job market, many quality individuals are considering buying a business to secure their future.   A true entrepreneur doesn’t wait for things to come to them. They make things happen. Do you want your business to be considered? Quality businesses attract quality buyers.

There is money to be invested! The uncertainty in the stock market has savvy investors looking for alternative investments. Owning a business can provide a nice return on investment, while allowing the buyer control over their funds. In addition, Private Equity Groups contact our office regularly looking for solid acquisitions.

You may be close to the bottom! Many businesses have seen sales and earnings level off, stabilize or start to increase in 2011. Earnings and assurances are what most buyers want.   If your business shows stable or increasing sales, it is much more attractive to buyers.

You are past ready to sell, emotionally, physically and mentally! Many business owners have delayed the sale of their business due to the uncertainty of the economy. The business suffers because the owner loses interest, enthusiasm or is unable to function in the same manner that made them successful. The business begins to suffer and the value when it is sold will be lower.

Buyers may soon have more options. In any given five year period a certain number of small businesses will change hands. This has not happened over the past few years and the “baby boomer” business owners are starting to retire. The active buyers may have more options to consider which could drive down the price they are willing to pay.