Benefits and Drawback of Acquiring Businesses

There are obvious advantages and some disadvantages to an acquisition.

If you are taking over a good business, you’ll have great cash flow.

When buying a business, you are typically buying yourself something that provides a major benefit to you.

 

Besides the usual profit and/or loss of the acquisition itself, comes the taxes and legal liabilities of such.

You want to make sure you have a great attorney who drafts the acquisition agreement to protect you.

For instance, you want to make sure you are not liable for any debts, liabilities. You want to make sure that the guidelines are clear between responsibilities, changing accounts, and delineating proportional payments during the interim.

You want to make sure you have a good accountant who knows how to help you benefit off of an acquisition and sale.

If you are looking to offset some taxes such as a capital gains reduction or expenditure, then you want to understand how to offset debt, or outlays by doing proper transactions. Sometimes setting up the incoming wire through an escrow account that pays debts from the escrow account will help reduce tax liability.

 

Contact us if you want help with your next acquisition:

Email – [email protected]

Phone – (800) 773-1523

• benefits and drawbacks of an acquisition

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