VI. ASSET SALE VS. STOCK SALE
Only an issue if your are a full "C" corporation. Subchapter "S" corporations not effected.
The IRS has made asset sales of retail store companies very unattractive.
Seller subject to double taxation in an asset sale.
- Once by the corporation on the "gain" from the sale of bulk transferred assets. (UCC1 Filing)
- And again when the seller takes the money Out of the corporation.
Disadvantage for buyers to purchase stock
- Buyer does not get to start a new depreciation schedule on the assets.
- Buyer inherits all known and unknown liabilities.