Most corporate buyers of businesses know about the 338(h)(10) tax election available under the Internal Revenue Code. The 338(h)(10) election allows a buyer to structure an acquisition as a stock purchase from a legal standpoint but as an asset purchase from a tax standpoint. A stock purchase may be desired legally to allow for a seamless transition of ownership and in cases where key contracts cannot be transferred. The 338 election allows the buyer in effect to depreciate and/or amortize the purchase price. The 338 election, however, is only available to a purchaser that is a corporation. Many purchasers are limited liability companies taxed as partnerships, not corporations. The 338 election is therefore unavailable. However, another tax election, known as the 336(e) election, is available to non-corporate purchasers. If the 336(e) election is made, the transaction is treated as an asset sale and, as with a 338 election, the purchaser receives a cost basis in the assets acquired equal to the purchase price, which the purchaser can deduct over time. As you can see, the often forgotten cousin of the 338 election, the 336 election, can be a valuable tool to a non-corporate purchaser.