7 Questions to Ask Yourself Before You Sell to Your Family

Passing the business on to your children isn't always easy, particularly when they aren't all equally involved in the business, says Ronald Schmaedick of Schmaedick & Associates Inc. in Eugene, Ore. Before you sell to a family member, ask yourself:

  1. How can I treat all my children fairly?
  2. Who should own the business?
  3. Who should be CEO?
  4. Who will have voting control?
  5. How much money will I get from the business? When?
  6. How long am I prepared to personally indemnify—or guarantee—the creditors or the company?
  7. What are the income ramifications of this plan?

Adapted from “Exit Strategies, REALTOR® Magazine, October 1998 and November 1998

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