Orlando, FL business attorney Jim Flick discusses the legal and financial implications of purchasing the business assets versus the business entity. He mentions that if an owner decides to sell their business, they have two options: an asset purchase transaction or a stock or equity purchase transaction. What’s best for the buyer is opposite to what’s best for the seller. In an asset purchase transaction, buyers prefer it because they can take tax write-offs in the future and only purchase specific assets and liabilities. They are not responsible for any unknown liabilities. However, sellers don’t like it as it results in higher income taxes. On the other hand, in a stock or equity purchase, buyers don’t like it as they cannot take tax write-offs, but they prefer it because they can get long-term capital gain treatment when they sell it. Sellers prefer it because they get any contingent or unknown liabilities.