Buying a Business or Its Assets: “Buying a Business or Its Assets”
This article provides an introduction to the legal nitty-gritty of buying an established business.
“A business is simply a collection of assets. Someone who offers a business for sale is trying to sell all these assets together, from the IRS’s point of view. A buyer may not want all of a business’s assets. You want to buy Sal’s Pizza Parlor for its location, but you don’t want Sal’s business name or the old pizza ovens and furniture. If you make Sal a good enough offer, he may sell just the building to you and not the rest of the assets. However, the tax consequences of this type of sale may be different than if you had purchased all of the assets. How the business is legally structured – sole proprietorship, partnership, limited liability company or corporation – also has important tax consequences to both the buyer and seller.”
– A cool little quickie. Buying an existing business has it’s own challenges and you should definitely research before trying. I will be looking for more articles on this subject since it offers a viable alternative. I am not necessarily a fan of franchises so they won’t be so prominent in my links. To me they are more for the guy/gal who wants to work for themselves but at working man/woman wages. -ed.