Chapter 2

The Purchase and Sale of an Incorporated Business

This chapter addresses the tax issues in acquiring an incorporated ­business operating as a C corporation that is not a subsidiary of another ­corporation. The special issues associated with purchasing and selling an S ­corporation are discussed in Chapter 3, where as issues associated with purchasing a ­subsidiary from its corporate parent are discussed in Chapter 4.

The major difference between the purchase of a C corporation and the purchase of the assets of an unincorporated business is that the ­corporate acquisition brings with it the system of double taxation that does not apply to the unincorporated business. The ramifications of double ­taxation apply to the corporation’s ...

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