How to Structure Equitable Construction Deals

Structuring deal terms often places buyers and sellers in competing tax positions. Featured in Construction Executive Magazine, Weaver’s Rob Nowak, Partner of Tax Services, dives into the considerations deal stakeholders should be aware of while reviewing a letter of intent or purchase agreement.

• The buyer’s point of view is usually easiest to understand. Generally speaking, buyers come into a deal looking for ways to amortize (i.e., deduct for tax purposes) the purchase price as efficiently as possible. Buyers achieve this result by structuring a deal as a combination asset acquisition (asset deal) and continuing employment agreements for key personnel. Sellers, on the other hand, will more often want to structure a “stock deal.” As we peel back the layers of the onion on each, it will become obvious why the parties are often at odds.

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