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LLC buyout vs RE direct Purchase
Hi All,
To all you accountants out there - My understanding of the implications are basically as follows;
From the buyers side, they avoid some of the costs (e.g. conveyance) as there are just legals. Still need to do all inspections / normal DD. The additional risks are things like pending legal actions that you need to do more DD on
From the sellers side, again potentially some avoidance of costs (e.g. Point of Sale inspection) but also on the tax side (assuming the property is in an Entity), do not get to use the un-depreciated value or if there are any income loses to shield any capital gains.
Do I have this about right or are there other important considerations.
Oren
To all you accountants out there - My understanding of the implications are basically as follows;
From the buyers side, they avoid some of the costs (e.g. conveyance) as there are just legals. Still need to do all inspections / normal DD. The additional risks are things like pending legal actions that you need to do more DD on
From the sellers side, again potentially some avoidance of costs (e.g. Point of Sale inspection) but also on the tax side (assuming the property is in an Entity), do not get to use the un-depreciated value or if there are any income loses to shield any capital gains.
Do I have this about right or are there other important considerations.
Oren