Steps to a Bargain Sale
STEP 1 – Preliminary Valuation & Proposal
Welfont reviews proposal with Seller and Seller’s tax and/or legal advisors to understand solution and process of a Bargain Sale to make sure it fits Seller’s needs and objective.
STEP 2 – Letter of Intent
If the proposal fits the Seller’s needs, Seller executes a non-binding Letter of Intent with the Buyer.
STEP 3 – Purchase and Sale Agreement
The executed LOI is converted to a binding Agreement (Purchase and Sale Agreement “PSA”)
STEP 4 – Due Diligence
The asset is reviewed by the Buyer, and an appraisal is performed. If the asset review meets requirements for both parties, closing is scheduled.
STEP 5 - Closing
Property is transferred for consideration:
- Tax Deduction (Form 8283)
While there are nuances to the Bargain Sale, the steps are identical to a “traditional deal”.
Disclaimer: Welfont is not a legal, financial, investment adviser or tax accounting firm and does not offer any legal, financial, or tax services or advice. Although the information contained herein is presented in good faith and believed to be correct, it is general in nature, so those considering transactions related to Internal Revenue Code 170 should consult their own tax counsel and/or tax professional or both. Furthermore, the information contained herein may not be applicable or suitable to some parties.