Buying: A Bankrupt Business

Assets are generally sold "free and clear" of all existing liens, claims, and encumbrances under court supervision (such as a Section 363 sale in the US).

How you structure the deal determines whether you acquire just the valuable pieces or inherit the company's past failures. buying a bankrupt business

You get a step-up in the tax basis of the acquired assets, lowering your future tax obligations. Stock/Equity Purchase (Rare & Risky): The Mechanic: You buy the shares of the company itself. Assets are generally sold "free and clear" of