Lesson · Facts First
Buying a Business
An existing business is cash flow with a paper trail - the price of skipping the startup years is diligence discipline.
The facts
- 01Diligence order: quality of earnings first (are the books real and adjusted?), customer concentration second, then legal, then tax - deals die on the first two.
- 02SBA 7(a) acquisition financing exists for qualifying buyers, typically requiring a personal guarantee and a down payment - SBA loan rules govern terms; structure matters as much as rate.
- 03Asset deals let the buyer step up basis and depreciate; stock deals inherit the entity, its liabilities and its tax attributes - price reflects the difference.
- 04Non-compete and transition services agreements protect what you are buying - the seller leaving too fast is a silent value leak.
Sources
- IRC Section 1060 (asset allocations)
- SBA 7(a) loan program rules
- USPPI / purchase-agreement practice
Educational content only — not tax, legal, investment, or VA-benefits advice. Figures verified against the cited sources for 2026; confirm your own situation with a qualified professional before acting.
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