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Acquisition of Company Assets

BY Stanley R. Kaminski
November 26, 2010

The acquisition of another company's assets is a great way for a company to expand with significant federal tax benefits. It also eliminates many of the headaches of dealing with the past debts of the selling company that a stock sale could entail. However, companies that acquire the assets of other companies still have a lot to worry about. Besides the financing issues and the various costs involved, purchasing companies continue to face concerns about any unpaid taxes that may transfer to them if tax bulk sale notices are not filed with the various taxing jurisdictions.

Yet assuming all normal due diligence is properly done, the tax releases received and the other closing problems resolved, there is another issue that may be lurking in the background that is not so obvious. This hidden threat comes from the little understood but ubiquitous presence of unclaimed property laws across the country that can result in the transfer of a substantial debt of the selling company, of which the purchasing company may not be aware.

Background

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