Posts Tagged ‘Depreciation’

The Difference Between an Asset Sale and a Stock Sale

Closely Held Businesses looking to negotiate a sale of their business will either do an Asset Sale or a Stock Sale.

Asset Sale

With an asset sale, the buyer is buying the assets of the business. These assets will be identified in the purchase and sale agreement. They may include accounts receivable, inventory and fixed assets including office furniture, machinery and vehicles. Additionally they may include intangible assets like customer lists, work force in place, goodwill and a non-compete agreement. … Continue reading »

The Difference Between a C Corporation and a Subchapter S Corporation

Business owners can maintain their corporation as a regular or “C” Corporation. Alternatively, if they are eligible, they may want to make a Subchapter S Election. Both are treated as separate legal entities. Here are the differences however:

C Corporation

While a C Corporation is a separate legal entity, it is also a separate taxable entity. The corporation will pay income taxes on any taxable income reported.

The Difference Between Capital Gains and Ordinary Income

Most long-term capital gains are taxed at 15% for 2010.  This rate is scheduled to increase to 20% in 2011.  Unfortunately, we need to say “most” because there are some exceptions as follows:

  • Taxpayers in the 10% and 15% ordinary bracket―0%
  • Certain depreciation recapture on real estate—25%
  • Collectibles—28%