If you have a business with at least one partner, then a properly drafted Buy-Sell Agreement is necessary to address issues of relating to the potential exit of a business partner as well as an essential for estate planning. Without a Buy-Sell, you may find you are stuck with an unwanted new business partner, and even if you have a Buy-Sell Agreement if it was not properly drafted you may be exposed to unintended tax liabilities. This Article examines why a Buy-Sell is essential for closely-held businesses, the events that should trigger application of the Buy-Sell, key provisions, and the advantages and disadvantages of the different ways of structuring the Buy-Sell Agreement.
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The Buy-Sell Agreement is Essential for All Closely Held Businesses with Multiple Owners