Two‑prong diligence question

January 30, 2026

by an intermediary from University of Utah - David Eccles School of Business in Mountain View, CA, USA

1.Is it typical for a buyer’s lender to request IRS Form 8821 during diligence to verify the seller’s tax filings? I’m seeing this come up and want to understand whether it’s standard practice in SBA or conventional acquisition financing as the buyers I am dealing with have been difficult. 2.How do sellers usually handle situations where the buyer wants to assign higher‑than‑market values to equipment or vehicles for the purchase agreement? The buyer is pushing to keep the values inflated, and while I want the deal to go through, does this create risk for me the seller. Any advice is greatly appreciated.

Reply by a professional
from University of Toronto in Toronto, ON, Canada

Thanks for including me, ^redacted‌. Unfortunately, I don't respond to anonymous posts.

Reply by a searcher
from Northwestern University in San Francisco, CA, USA

There's a very specific cost to the seller if hard assets are overvalued instead of value getting allocated to goodwill. They'll pay ordinary income tax on the excess value of the hard assets vs long term capital gains tax if that value is assigned to goodwill. Ultimately it costs the seller some net proceeds, but not sure there's any "risk" beyond that.

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