by Mike Baker | Jan 12, 2024
Let’s say you have some intellectual property (IP) that you’d like to give to a corporation in exchange for shares of its common stock. The IP and stock are both worth $10,000 and you have tax basis in the IP of $800. Normally such an exchange would...
by Mike Baker | Dec 26, 2023
Let’s say you’re the majority shareholder of ABC, Inc., a C corporation, which just sold substantially all of its assets in a taxable asset sale. The deal consideration consists of three parts (i) $30M to be paid at closing, (ii) $3M which is being held...
by Mike Baker | Dec 7, 2023
So, your company is being sold and you want to know whether you should exercise your stock options prior to closing. First you should confirm whether the transaction agreement (i.e., stock purchase agreement, asset purchase agreement, or merger agreement) provides...
by Mike Baker | Nov 13, 2023
For tax purposes, there are three types of equity that can be issued in a partnership or an LLC taxed as a partnership: capital interests, profits interests, and carried interests. Knowing what type of interest you own or are being granted is important, because there...
by Mike Baker | Nov 9, 2023
So, you started a business and you issued a convertible note. You know, a loan that can be repaid with the equity of your start-up. The date of the note conversion has arrived and you’re busy calculating how many shares you need to issue when suddenly you get an...
