The graph above leaves little doubt about the detailed and complete nature of the sales contract. It is also the basis for negotiations between you and your buyer, not only on the price, but also on what is contained in the purchase (and who is excluded from it) and how the agreed payment is paid and distributed among the investment categories defined by the IRS. Both of these approaches have advantages and disadvantages for both parties to the transaction. When deciding to include or structure debts, you should consider the following questions: attempting to collect debts from another person can be complicated. In order for you to move in, the seller must perform an assignment contract and you must go to all parties who owe money to the seller to inform them of the assignment. Health insurers may also have company-specific forms they need to process the order, and it can be a bureaucratic nightmare to make sure the right form is submitted to the right insurer so you can receive payment. Where part of the purchase price is paid by deferred payments, the agreement shall contain a description of the assets held by the buyer, which shall be listed as credit guarantees; personal warranty requirements, if any, and operating requirements for protection against devaluation of activities and assets before the price is paid in full. A statement confirming the buyer`s power and legal right to authorize the purchase; ensure that the statements of the buyer and its guarantors do not contain false statements or omissions. A statement that confirms the seller`s power and legal right to authorize the sale; the seller has clear and negotiable ownership of the transferred assets; the financial documents submitted reflect the financial situation at the time of establishment, whether legal or legal; that the seller is not aware of any obligation or obligation beyond the investments annexed to the contract of sale. Finally, there may be tax benefits if the receivables are excluded from the sale, especially if the conclusion of the contract for the sale of assets is near or close to the end of your tax year. Claims are generally taxed as ordinary income, but you can reduce your effective tax rate on receivables if they fall in a different tax year than the actual sale of the practice. Therefore, if you sell your practice in 2014 for a net profit of $600,000, including receivables, your effective tax rate may be higher than if you sell the practice for a net profit of $500,000 excluding receivables in 2014 and collect receivables of $120,000 in 2015. [1] List of liabilities borne by the buyer, often including liabilities; also contains the statement that the buyer does not assume any commitments other than those mentioned above.

A definition of disputes and dispute resolution rules relating to the management of defaults should not be given to the buyer or seller under the terms of the contract. It`s important that you understand exactly what`s in a buy and sell contract for businesses, so you know what you can expect, where to negotiate, and why it`s so important to attract the expertise of your accountant, lawyer, and broker if you`re using one. Details of the non-competition or non-competition clause, management consulting contract or employment contract that the seller will sign as part of the closing transaction. . . .