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Buying a business is an alternative to creating one

There are a lot of reasons people in Louisiana chose the path of entrepreneurship over working for someone else. There's a difference between being good at something and figuring out how to make money pursuing it for a living. One way to jump-start the path to success is to consider buying an existing business rather than starting one from the ground up.

An initial consideration concerns the type of business that would be appropriate. Experienced business consultants indicate that a stand-alone business, a franchise or something less formal such as a consulting company are among the options based on the nature of the business and the prospective owner's skills, background and preferences. Based on the existing market, it may take some time for an opportunity to arise, or there may be multiple options to choose from.

Capital gains taxes after selling a business

When someone buys or sells a business in Louisiana, the resulting capital gains will affect their annual tax returns. Capital gains are handled differently than typical income that's based on profits from the business; instead, they come from the sale of a capital asset. There is a tax assessed on all capital gains, and this can apply to the direct sale of a company as well as shares of stocks and similar securities. Capital gains tax assessment only comes into play if the seller makes a profit or takes a loss on the sale of the asset.

While short-term capital gains for assets held less than one year are taxed at the same rate as regular income taxes, long-term capital gains, for assets held for over a year, are taxed at a 17% rate. Most types of property held by a business, whether physical or intellectual property, can be considered capital assets, especially when they are sold as part of the company. For example, merchandise, inventory, patents, copyrights, real estate and investments are all considered capital assets and subject to capital gains tax if sold. Even accounts receivable that can be sold are considered capital assets. However, personal property and raw materials are not considered capital assets.

Why estate plans need to be updated

Louisiana residents should ensure that they review their estate plans regularly. Director John Singleton, who died suddenly of a stroke in April, had a will from 1993 that had never been updated. Instead of a trust that would keep his estate plan private, make his wishes clear and appoint one or more people to handle his intellectual property, the will names the only one of his five children who had been born at that point as the heir.

California law states that children born after the time a will is created can inherit equally with a few exceptions, such as those who will inherit via a life insurance policy or other means. However, there is still likely to be conflict around Singleton's estate. His family argued publicly over whether he would survive his stroke, who should be appointed conservator and his cause of death. His mother filed his will with the probate court, but one of his daughters challenged her efforts to become executor.

Good reasons to establish an ESOP

Business owners who are looking to sell their companies may want to consider selling them to their employees. To do so, a company can establish an employee stock ownership plan, or ESOP. An ESOP allows an interest in the business to be held in a trust for the employee's benefit. When the CEO is ready to step down, the ownership stake is transferred to those who are beneficiaries of the trust.

There are many reasons why a business owner would want to sell his or her company to its workers. One reason could be to instill a greater sense of loyalty in an organization's workers. Loyal workers tend to be more productive and less likely to leave, which cuts down on turnover. Furthermore, selling a company to the employees means that the transition to new ownership can be a gradual one.

Determining the right price for your business to sell

Building a business can mean creating an income stream for many years to come or potentially securing a lump sum payment from someone when you sell your established business to someone else. You have invested countless hours of your own time and significant amounts of money to build a business that succeeds. You want to ensure you receive your investment back when you sell.

It can be flattering to have someone offer to purchase your business because a purchase offer validates the idea that your company has value and a profitable future. Before you jump on the first offer, it's important that you take some time to consider what value your company truly represents.

Toyota recalls another 900,000 vehicles over Takata air bags

Louisiana car owners may have heard that Toyota recently announced a recall of 928,000 vehicles with defective Takata air bags. The recall is the last phase of the automaker's multiyear effort to replace the explosion-prone air bags with safe ones.

Faulty inflators in Takata air bags could cause the devices to deploy with extreme force, shooting shrapnel into a vehicle's cabin. The risk gets higher as the inflator ages. The latest recall involves Toyota, Scion and Lexus vehicles that initially had their faulty Takata air bags replaced with new Takata air bags of the same type. The replacement was intended to buy time until the automaker could acquire alternative air bags from non-Takata suppliers. Those air bags are now available, and dealerships will replace the interim air bags for free.

Dressers recalled due to tip-over fears

About 25 children are killed in Louisiana and around the country each year after being struck by falling television sets or items of furniture, and many of these tragic accidents involve dressers that topple over. Furniture manufacturers voluntarily conduct tip-over tests on dressers over 30 inches tall, but this has not been enough to prevent four dresser recalls over a five-month period. Two such recalls were announced on Oct. 3, and one of them is the first involving a dresser shorter than 30 inches.

The first recall covers about 1 million dressers manufactured by a Canadian company and sold in Sears and Kmart stores. The second covers almost 1,800 dressers made in California and sold by retail chains including Macy's, Kohl's and Bed, Bath & Beyond. No injuries or deaths have been reported in connection with the recalled dressers. A representative of the Canadian company said that consumers would be offered an anchoring kit at no charge to secure the potentially unstable dressers to a wall.

Tips to help you find the right business partner

Before you launch your new business, you make one of the most crucial decisions in the entire process: You pick a business partner. The person you choose could make or break your new company. They simply have to be a good fit. You must be critical and carefully consider what it will be like to work together moving forward before you commit to anything.

Finding the right person can be hard. What do you look for? What is most important? What red flags should you be aware of? There are a lot of questions to ask, so here are some tips that can help you get started:

3 ways to reduce the risk of probate court in Louisiana

Creating a will or estate plan gives you control over the legacy you leave behind when you die. You may have specific wishes regarding who gets which assets from your estate. Sadly, no matter how carefully you plan, your wishes could always wind up subverted by a family member or heir who does not agree with the terms that you put in your will.

Louisiana law allows people to bring challenges against an estate if there are potential issues with it, such as lack of testamentary capacity at the time of the will's creation, undue influence of a third party or concerns about fraud. People can also bring challenges if a will is outdated or is full of mistakes.

5 mistakes you do not want in a business contract

Almost no business runs completely independently of anyone or anything else. Whether it be sales deals, vendor agreements, contractor terms or a real estate lease, a business frequently comes into contact with other entities. All of these points of contact need a written contract so each party knows what it will get, and what is expected of them.

Yet it’s easy for busy business owners to overlook this key step – even though a subpar contract can lead to significant challenges and unpleasant surprises down the line. So, with that in mind, here are five issues you want to avoid in a business contract.

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