I am looking to sell my corporation, what are the advantages and disadvantages of a stock sale versus an assets sale?
A. The biggest advantage of a stock sale are minimal legal costs. Since all you are selling is stock, there is no need for several title changes for assets or complex sales agreements. A second advantage is that presuming the corporation has been around for more than a year (or five years if certain tax proposals are signed into law) you would benefit from lower capital gain tax rates. The biggest advantage of an asset sale is that you can pick and choose specifically which assets are sold. This can allow you to hold on to automobiles, buildings, life insurance policies, investments, cash or just about anything else you value more than the buyer does. Since you value the assets more the total value to you increases. A second advantage is that if you hold onto appreciated assets in the corporation, and you leave the corporate stock in your estate, you heirs receive a step-up in basis saving income taxes on their ultimate sale. A major disadvantage of the asset sale, is that if done impr
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