How Fresh Legal Perspective Can Help
Have you grown a successful business enterprise? Are you ready to trade in your business suits and appointment book for a set of golf clubs and travel reservations? Or, are you looking to purchase an existing business? Do you know what paperwork is needed to facilitate the transfer of your business? Have you considered the tax consequences of the sale?
Asset Purchase Agreements explain the how the assets of a company will be transferred from the seller to the buyer. If you schedule a consultation, the experienced business law attorneys at Fresh Legal Perspective can provide legal counsel in designing, negotiating, and drafting effective Asset Purchase Agreements.
What to Expect from an Asset Purchase Agreement
Asset Purchase Agreements provide the legal framework that governs the process of transferring assets from the seller to the buyer. The Asset Purchase Agreement sets out the rights and responsibilities of each party to assist in an orderly transition.
A professionally drafted Asset Purchase Agreement should include provisions stating how the parties will report the transfer for tax purposes. The Internal Revenue Service has created a tax framework that pits the buyer’s tax interests against the seller’s tax interests. For example, generally, the buyer will prefer to assign more of the value to assets with a short depreciable life or to inventory; whereas the seller prefers to assign more the value to intangible assets. In most cases, buyers prefer to use asset purchase agreements whereas sellers prefer to use stock purchase agreements as the documents to facilitate the sale of a business.
Both buyers and sellers benefit from having a business and tax attorney to evaluate the tax consequences of the business sale while ensuring that the contract provides the protection necessary for a smooth transition. Our firm can assist in the creation of a new Asset Purchase Agreement or the review of an existing one. To retain our services, please contact us today.
This portion of the site is for informational purposes only. The content is not legal advice.