When you sell a business, there are many details to consider. The way you transfer all of the assets to someone or some other agency is important, and you want to limit your risk and liability as much as possible while maximizing the revenue from the sale. Often, a business has multiple assets that it is selling, and those assets might be disbursed among multiple buyers. Staying on top of all legal and financial matters related to the transactions is important.

One specific thing you need to pay attention to is the taxes related to the sale of the assets. Assets have to be classified for the purpose of accounting and tax payments. Asset types can include real property, depreciable property, capital assets and property that is held for the eventual use of customers, which might include raw goods or product inventories.

At the time a business is sold, certain tax forms have to filed. The type of form and when it must be filed it depends on the type of asset being sold. You might have to report the sale of assets such as partnership or corporate interests or use a residual method to report the value of the sale.

Business taxes are often complicated, and the taxes involved in the transfer of a business are even more so. As taxes are only one of many financial and legal considerations in selling a business, it’s important to seek experienced assistance to mitigate your risks. An experienced business lawyer can help you understand all of your risks and options to better navigate business transactions.

Source: Internal Revenue Service, “Sale of a Business,” accessed April 01, 2016