Anshu Arora LLM, MSc, PMP

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The Tax Side of Buying and Selling A Business

When you are looking into buying or selling a business, there are really only two options:

  1. To buy or sell the assets of the business
  2. To buy or sell the shares of the company that run the business

The first is known as an asset sale; the second is a share sale. There are tax advantages to both.

1. Asset Sales

An asset sale is where you buy the assets of a business, such as furniture, equipment, accounts receivable, inventory and leasehold improvements.

2. Shares Sales

The second option is a share purchase/sell. If you have an incorporated company, you may wish to consider selling the shares of the business. The advantages of this option are numerous, but there are many pitfalls as well.


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