Guest boberlander Posted June 28, 2001 Posted June 28, 2001 Is it common to have a seller finance the sale of shares to an ESOP? That is, no bank loan involved. S-corp owner who wishes sell 100% ownership to the plan and take a promissory note for 15-20 years from the plan. Thank you.
RLL Posted June 29, 2001 Posted June 29, 2001 It certainly is not uncommon in those situations where the seller is willing to be the lender and/or when bank financing is not available. Inasmuch as a tax-deferred election under IRC section 1042 is not available to the seller of S corporation shares to an ESOP, the complications of combining an installment sale with a tax-deferral election under section 1042 will not arise.
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