28 Jan Selling Your Business in 2026? Legal Steps You Should Take Now
If you’re thinking about selling your business in 2026, now is the time to start preparing. Most owners underestimate how long the process takes, and how much value can be lost if you wait too long to get your legal and financial house in order.
Whether you plan to sell to a competitor, transition to family, or entertain private buyers, the smartest move you can make is advance preparation.
1. Get Your Business Documents Organized (Buyers Will Ask!)
Any serious buyer will conduct due diligence, which means they’ll request nearly every document associated with your business. Starting early ensures there are no gaps, surprises, or red flags.
Prepare or update:
- Articles of incorporation or organization
- Partnership agreements (if multiple owners) and any buy-sell agreements
- Meeting minutes
- Operating Agreement, Bylaws or internal governance documents
- Business licenses and permits
- State and federal registrations
- EIN confirmation
- Ownership records and capitalization tables
If anything is outdated, inconsistent, or missing, correcting it now prevents you from scrambling during negotiations.
2. Clean Up Your Financials and Confirm All Tax Filings
Buyers want clean, transparent financial records. Messy books can kill a sale or drastically lower your valuation.
Make sure you have:
- Accurate balance sheets
- Profit-and-loss statements (ideally 3 years)
- Updated cash flow reports
- Payroll tax records
- Corporate tax filings
- Sales tax compliance
- Updated depreciation schedules
If your books aren’t clean, consider having a CPA conduct a review or prepare a formal financial statement.
3. Review All Contracts Before a Buyer Does
Contracts are often the backbone of a business sale. A buyer wants assurance that relationships, obligations, and revenue streams will transfer smoothly.
Review:
- Client and vendor contracts
- Leases (property, equipment, vehicles)
- Service agreements
- Franchise agreements
- Licensing agreements
- Insurance policies
- Loan documents
Look for:
- Assignment limitations
- Automatic termination provisions
- Personal guarantees
- Expiring agreements
Fixing problematic contract clauses now can protect your future sale price.
4. Resolve or Disclose Any Business Liabilities
No buyer wants to inherit unresolved legal issues. Addressing them before going to market makes your business more attractive.
Common issues include:
- Unpaid taxes
- Employee disputes
- Pending lawsuits
- Insurance claims
- Vendor disputes
- Regulatory compliance problems
- EIDL loans
Even if something can’t be fully resolved, documenting it clearly and showing a plan of action builds buyer confidence.
5. Protect Your Intellectual Property Before Listing the Business
Your brand, content, trademarks, processes, and digital assets significantly affect valuation.
Now is the time to:
- Register trademarks (or confirm they’re registered correctly)
- Secure domain names and social media ownership
- Document proprietary processes
- Confirm copyright ownership of content
- Update confidentiality agreements
- Ensure employee-created IP is legally assigned to the company
A buyer must know they’re getting all the rights they’re paying for.
6. Update Your Employee Handbooks, Policies, and Agreements
Workforce stability is a major factor during a business sale. Clean, legally compliant employment documentation helps reduce risk.
Review and update:
- Employee handbooks and policies
- Independent contractor agreements
- Confidentiality agreements
- Wage and hour compliance
- Benefits documentation
- I-9 and personnel files
Make sure all policies align with current state and federal employment laws.
7. Decide Whether You’re Selling Assets or the Entire Entity
One of the most important decisions you’ll make is whether to structure the sale as:
- An asset sale, or
- A stock or membership interest sale
Each has different tax implications, liability considerations, and negotiation points.
Typically:
- Buyers prefer asset sales (less liability).
- Sellers often prefer stock/entity sales (better tax treatment).
Discuss these options with your business attorney and CPA well before you begin negotiations.
8. Get a Business Valuation Before You Go to Market
You wouldn’t sell a house without knowing its value, and the same applies to your business.
A valuation helps you:
- Set realistic expectations
- Identify weaknesses or opportunities
- Understand your business’s market position
- Support your asking price during negotiations
Most buyers will perform their own valuation, so starting with a professional assessment strengthens your position.
9. Create a Business Succession Plan (Even if You Don’t Think You Need One)
If you are the face of the business, a buyer needs to know it can succeed without you. Preparing leadership, documenting processes, and creating transition plans all increase the value and salability of your company.
10. Work With a Business Attorney Before Entertaining Offers
Many business owners wait until they receive a letter of intent or purchase offer before contacting an attorney, but early legal guidance is critical.
Your attorney can help you:
- Structure the sale
- Identify legal risks
- Clean up documents
- Prepare due diligence materials
- Draft or review confidentiality agreements
- Negotiate the terms of the sale
- Protect yourself after closing
Starting early may be the difference between a smooth sale and a stressful one.
Thinking About Selling Your Business in 2026? Start Now.
The year before a sale is the most important. Preparing now will help you:
- Increase your business’s value
- Reduce legal risk
- Avoid delays
- Attract more qualified buyers
- Secure a cleaner, smoother, more profitable sale
Whether you’re certain you want to sell or simply exploring options, talking to an experienced business attorney can help you put the right foundation in place.