Who is responsible for paying sales and other transfer taxes when All County purchases my All County business?
All_County Franchise · 2025 FDDAnswer from 2025 FDD Document
23.6.7. Instruments. At the closing, you agree to deliver instruments transferring:
23.6.7.1. good and merchantable title to the assets purchased, free and clear of all liens and encumbrances (other than liens and security interests acceptable to us), with all sales and other transfer taxes paid by you; and
Source: Item 23 — Receipts (FDD pages 43–157)
What This Means (2025 FDD)
According to All County's 2025 Franchise Disclosure Document, if All County purchases your business, you are responsible for paying all sales and other transfer taxes. Specifically, when you transfer the assets of your All County business back to All County, you must provide good and merchantable title to the assets free and clear of all liens and encumbrances. As part of this, you are responsible for ensuring that all sales and other transfer taxes are paid by you.
This means that as the seller, you will need to budget for these taxes when negotiating the sale price with All County. It is important to consult with a tax professional to understand the specific tax implications of selling your All County franchise and to ensure compliance with all applicable tax laws.
This is a fairly standard practice in franchise agreements, as the seller typically bears the responsibility for taxes associated with the transfer of assets. However, it is crucial to factor these costs into your financial planning when considering selling your All County franchise.