CCH Online Store Books on small business topics. Free E-mail Newsletter Monthly updates on developments affecting small businesses. Sales Search Help State laws can impose a variety of obligations on both the seller and buyer of a business. Our purpose here is to alert you to some of the implications of the most common requirements. For more detailed information on the requirements in your state, consult your attorney.
Bulk sales acts.
Otherwise, the sale will be ineffective against those creditors, meaning that they can still repossess the goods from the new owner, in repayment of the debt. In some states the creditors will also have a lien on the proceeds of the sale. Even if your business doesn't have inventory, you may be covered by the law because a number of states have extended it to apply to certain service businesses, most commonly gas stations, restaurants, and bars. The purpose of the law is to give your creditors a chance to try to collect anything you owe them before you pack up and leave town. After all, your creditors know nothing about your buyer, and might or might not have extended credit to him, if they did know.