Perhaps you folks can provide some help on what is a tricky topic for me. I am a 100% owner of a small seminar business. We are incorporated. I am looking to plan an exit strategy and would like to sell portions of the company to the director of operations over the next 5 years. Let's just say 20% a year.

Can you provide some advice on how to structure this, what the tax implications may be, and what paperwork is involved?

I am not sure about the tax implications but one of the most important things you can do is determine the value of the business. Usually that is done based on a multiple of EBITDA or net income. You have to decide on that figure before you begin to worry about taxes.

I agree first you have to decide how much your business is worth and then you can worry about the rest later. The other thing you have to consider is how to pay this individual if you are paying a "20%" dividend or portion of the business - you should probably have a different formula than what you have today as an employee.