How to Close or Sell a Small Firm

A wave of attorneys leaving the law is on the horizon since 182,000 practitioners are over sixty-five. For solo and small firm lawyers, the retirement decision means disposing of equipment, laying off staff, storing files, terminating leases, and transferring cases. The following are strategies for closing or selling a small firm and links to resources for implementation.

Tips

• Advisors - hire an advisor to assist with marketing, negotiation, and valuation.
• Agreement - use a “Buy-Sell Agreement” to plan for the departure of a partner.
• Alternatives – options include closing the firm, designating a successor, reducing caseload, or selling.
• Ethics – review ethical obligations to avoid infractions and pitfalls.
• Hiring – mentor a young lawyer to replace an exiting lawyer.
• Insuring - keep malpractice insurance for risks arising after closing or sale.
• License – research rules about retaining licenses to facilitate practicing pro bono, re-opening, and referral fees.
• Notices – notify bar associations, clients, colleagues, insurers, and staff on a timely basis.
• Finances – review finances to ensure adequate retirement savings for healthcare and living expenses.
• Planning – prepare action plans for assets, cases, employees, files, liabilities, etc.
• Readiness – attend a CLE program, read planning materials, and see a consultant or bar advisor.
• Succession – appoint a colleague to wind down your practice in case of death or disability.
• Timing – start planning your exit strategy by your 50s to avoid mistakes and lost opportunities.
• Winding Down - suspend marketing and stop accepting new cases in advance of retirement.
  

Conclusion

Start your retirement planning by mid-career. Begin by discussing retirement plans with a bar association advisor, CPA, financial consultant, or life coach. Then prepare a written plan with a timeline, strategies, and tactics. Planning can bring positive results for you, your clients, and your firm. Consult the resources listed below to help you close or sell your practice.

Articles

• Closing a Law Practice, ISBA, Jan. 1, 2017.
• The Evolving Ethics of Selling a Law Practice, Your ABA, Nov. 2020.
• An Attorney’s Guide to Closing a Law Firm, National Law Review, May 1, 2018.
• How to Value, Sell, and Purchase a Law Practice, Law Practice Today, Sep. 7, 2022.
• Should You Give Up Your Law License When You Retire?, Connecticut Law Tribune, Apr. 11, 2019.
• Lawyer Retirement: Planning for Life After Law, Attorney at Work, Nov. 5, 2020.
• Succession Planning for Solo and Small Firm Lawyers, MSBA, Jul. 23, 2024.
• When Should a Lawyer Stop Being a Lawyer?, Experience Magazine, Jul. 18, 2022.
• Buying and Selling a Solo Law Practice: A Hands-On Guide, GPSolo Magazine, Feb. 4, 2025.

Books

• Buy-Sell Agreements: Valuation Handbook for Attorneys, ABA Book Publishing, Aug. 20, 2024.
• Buying or Selling a Law Practice, Lawyers Mutual, Oct. 2016.
• Plan Ahead for Closing a Law Practice, Lawyers Mutual, July 2016.
• Lawyers Guide to Succession Planning, ABA Book Publishing, Jan. 28, 2016.
• Planning Ahead Guide 3^rd Edition, New York State Bar Association, Dec. 5, 2023.
• Planning for the Next Stage of Your Law Practice, North Carolina Bar Association, Sep. 1, 2021.

Checklists

• Closing a Practice (North Carolina Bar Association)
• Checklist for Departing Attorneys (New York State Bar Association)
• Merging Law Firms (Illinois State Bar Association and Affinity Consulting)
• Checklist for Selling a Practice (North Carolina Bar Association and The Law Practice Exchange)
• Seigneur’s Law Firm Valuation Checklist (Business Valuation Resources, LLC)

Videos

• What Your Practice Management Advisor Can Do for You!, Legal Talk Network, Apr. 24, 2023.
• Exit Strategies for Solo and Small Firm Retiring Lawyers: How to Avoid the 3 Biggest Mistakes, ABA Senior Lawyers Division, Feb. 26, 2023.
• The Rules of Retiring, Going Inactive, or Closing a Firm, The Florida Bar, June 29, 2020.
• Retirement Planning Strategies for Law Firm Owners, Justia, May 17, 2024.
• How to Value a Law Firm?, The Law Practice Exchange, Dec. 21, 2020.

Websites

• Close or Sell Your Business (SBA)
• Lawyers in Transition – Resources related to End-Of-Career Issues, (ABA Center for Professional Responsibility)
• Retirement Guides (Lawyers Mutual)
• Succession Planning and Senior Lawyer Resources (The State Bar of California)
• Succession Planning (ABA Center for Professional Responsibility)