Authored by Rhys T. Wilson, Partner and Co-Leader Mergers & Acquisitions at Nelson Mullins Riley & Scarborough LLP
This chapter explains why acquirers of private companies generally insist on taxable asset purchase treatment for income tax purposes and how this drives the structure of the bulk of middle-market M&A today. We will then look at potential traps for the unwary that can lead to the loss of this critical tax treatment by private company buyers. Finally, we will look at how taxable asset purchase treatment can turn disastrous for private company owners and steps that you can take now to ensure favorable tax treatment for your M&A transactions.
This chapter is written specifically for CEOs, founders and owners of private companies. It is also written for CEOs and other key leaders of companies looking to acquire privately held businesses. This chapter explains the governing tax rules in plain English and with an eye toward their practical application by business people.
Language
English
Pages
23
Format
Kindle Edition
Release
December 27, 2012
Why Buyers Prefer Taxable Asset Purchases and What this Means for Your M&A Transaction
Authored by Rhys T. Wilson, Partner and Co-Leader Mergers & Acquisitions at Nelson Mullins Riley & Scarborough LLP
This chapter explains why acquirers of private companies generally insist on taxable asset purchase treatment for income tax purposes and how this drives the structure of the bulk of middle-market M&A today. We will then look at potential traps for the unwary that can lead to the loss of this critical tax treatment by private company buyers. Finally, we will look at how taxable asset purchase treatment can turn disastrous for private company owners and steps that you can take now to ensure favorable tax treatment for your M&A transactions.
This chapter is written specifically for CEOs, founders and owners of private companies. It is also written for CEOs and other key leaders of companies looking to acquire privately held businesses. This chapter explains the governing tax rules in plain English and with an eye toward their practical application by business people.