The Small Numbers Matter

As January rolls in, many recent business acquisitions are fresh on the books, and CPAs and business owners are turning their attention to financial reporting.

In the rush to close deals—especially at year-end—purchase agreements often skim over the critical details of purchase price allocation across asset classes. While the headline figure at closing - the “Big Number” on the purchase agreement - may dominate the discussion, the nuances of asset allocation can have lasting financial implications. Overlooking the “Small Numbers” on the purchase agreement can result in transaction remorse as both parties move forward independently.

These details take center stage when post-acquisition tax planning begins. The way purchase price is distributed between real estate, machinery and equipment (M&E), and goodwill can directly influence the seller’s capital gains tax on closing and the buyer’s future business personal property tax obligations.

At Capitale Analytics, we help buyers and sellers navigate this process, ensuring fair and defensible purchase price allocations for business personal property and M&E. Whether we represent one party or are engaged jointly, our valuations are built to stand up to scrutiny.

We go beyond basic appraisals. Our team assists in cleaning up tax asset schedules—an area often neglected until acquisition time. Businesses frequently overlook older assets, focusing only on those with positive book value (NBV). However, accurately recording and valuing older M&E assets, even those with $0 NBV, can significantly impact tax strategies for both parties when a business is sold.

When you work with Capitale Analytics, you can trust that every report will meet the highest standards. Our appraisals are fully compliant with USPAP, GAAP, and IRS regulations, and we guarantee they will pass any internal or external audit. With us, purchase price allocation appraisals for M&E and business personal property are done correctly, the first time.