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What do you need to do when you see business machinery?

You don't want to sell your business, but you want to get rid of some of your property. You have several pieces of machinery you no longer need, and you could use the money for marketing and expansion.

Before you sell your asset, you need to make sure you understand the legal process for doing so. Selling your assets requires a large amount of documentation. Here are a few things you may need.

1. A broker or finder agreement

This is an agreement that some asset sales will have if someone else locates a buyer.

2. Asset purchase agreements

Once you have someone interested in purchasing an asset from you, you should have an asset purchase agreement prepared. This has information such as the sale price and other important data about the equipment, date and buyer.

3. A promissory note

In the case that the equipment isn't being paid for all at once, you may want to obtain a promissory note. This is a signed document guaranteeing that the buyer will pay for the equipment over a certain period of time. Essentially, the note gives you a right to make a claim for compensation if the buyer does not pay.

These are only three of the things you'll need during an asset sale. Others might include the opinion of your attorney, a bill of sale and noncompetition agreements. Your attorney can help you prepare these documents, so you know you have everything you need to document the sale of your assets. Good preparation makes a difference and can help with your taxes and other financial transactions in the future.

Source: FindLaw, "Completing an Asset Sale," accessed Feb. 23, 2018

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