World Class Mergers & Acquisitions  |  For Companies $5 Million to $100 Million in Revenue

Merger & Acquisition FAQ – January 2016

Q: It is clear that I will end up owing taxes for the 2015 tax year.  What can I do in order to reconcile the situation with the IRS?

A: There are a few avenues that can be taken.  First, you can pay the bill in full.  If the liability is too large you may file an installment agreement with the IRS to pay the debt over time.  In extreme cases, an offer in compromise is also a path.

Q: What will the estate tax exemption be for 2016?

A: It is indexed for inflation at $5,450,000 for 2016.  The annual gift tax exemption remains at $14,000.

Q: When I sell my business, what assets can I expect to keep in the transaction?

A: When a business is sold, the asset purchase agreement dictates which assets are sold and which assets are kept by the seller.  Typically, the cash and accounts receivables are not sold along with the other assets as the seller keeps these in order to pay outstanding debts of the business and provide the buyer with free and clear ownership.  It must be remembered that an asset sale means the corporate structure is still in existence and may have to be dissolved after the sale.

By: Basi & Basi at the Center for Financial, Legal and Tax Planning for Transworld M&A Advisors