A decision to buy a business should be made after careful review of records of the existing business. Hiring legal help could help a new owner. Regardless the following list reminds you some important aspects of a business for you to investigate.
Review records carefully: Financial records are more important than any other. Also look at local, state and Federal taxes as well as payroll taxes for the business. Certain businesses such as commercial child care may require maintenance of additional records of the employees by law.
Assets vs business: This is critical if a law suit is filed against the business. If you buy the assets not the business, you are not assuming any liabilities of the previous business.
Taxes can tell you more about the business: Carefully review the financial statements and tax filings if made available to you. Telltale signs of a bad business can be revealed in financial statements. Ask about the payroll taxes and sales tax and they can provide true profile of a business.
Assumption of existing lease: Remaining time of the lease and whether the landlord allows assumption is important for a new business owner. These findings are to be made prior to signing any agreement to purchase a business.