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Lane
Lane, JD, CFP, MBA, CRPS
Category: Tax
Satisfied Customers: 3860
Experience:  Juris Doctorate, CFP and MBA, Providing Financial & Tax advice since 1986
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hi, my wife and I are buying a business. It is a share sale

Resolved Question:

hi, my wife and I are buying a business. It is a share sale 100 percent of the shares. The bank wants to know if the loan should be made to my wife and I or to our existing business. The loan will be secured against the assets of the new company.
Submitted: 1 year ago.
Category: Tax
Expert:  Lane replied 1 year ago.

NPVAdvisor : Hi,
NPVAdvisor : Is your surrent business a passthrough or a c-Corp?
NPVAdvisor : Having it made out to the current business WOULD help to document that this is a business laon, making it a business deduction
Customer: Our current business is a canadian controlled private corporation. The new business will be owned by we two, not our other corporation. The loan will be secured against the assets of the new corp.
NPVAdvisor : Then it should be in your names
NPVAdvisor : THe only reaons I asked was that if the other business is a going concern AND has a higher tax bracket, the interest deduction may have a bigger tax benefit
NPVAdvisor : just a thought
NPVAdvisor : But if you Are the ownners ... and this is your funding to buy the business ... It's all much cleaner that you have the loan
NPVAdvisor : It is still a business loan, therefore deductible
NPVAdvisor : amke sense?
NPVAdvisor : sorry for the typos
Customer: Yes thanks thats clear. I think I saw that you were in new york. No offence, but I need to know that you are sure about these things for Canada.
NPVAdvisor : YW, this is really all common law, when it comes to the ownership issues.
NPVAdvisor : and the tax issues are simply take the deduction where you have the highest rate if possible
Customer: Ok thanks I think thats it for now.
NPVAdvisor : but in ANY jurisdiction if you are the owners, having the loan in your name makes sense
NPVAdvisor : sure thing
NPVAdvisor : If this HAS helped, I would appreciate a feedback rating of 3 (OK) or better. That's the only way they will pay us here
NPVAdvisor : HOWEVER, if you need more on this, PLEASE COME BACK here, so you won't be charged for another question
NPVAdvisor : Thanks
NPVAdvisor : Lane
Customer: Ok thanks bye
Expert:  Lane replied 1 year ago.
Our chat has ended, but you can still continue to ask me questions here until you are satisfied with your answer. Come back to this page to view our conversation and any other new information.

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Expert:  Lane replied 1 year ago.


Good bye

Good luck with everything!

Lane

Lane, JD, CFP, MBA, CRPS
Category: Tax
Satisfied Customers: 3860
Experience: Juris Doctorate, CFP and MBA, Providing Financial & Tax advice since 1986
Lane and 4 other Tax Specialists are ready to help you

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