In this guide, we will explain what buying out a business partner means, how to prepare to buy out a business partner, and more. Business assets are not considered legally transferred without a properly executed Business Purchase Agreement between the seller and purchaser.In order to buy out your business partner, the two of you need to come to an agreement about how much the business is worth. A partner buyout can be a timesensitive situation, a hard money lender like Socotra Capital is the best choice to help you quickly finance the buyout. Sell agreement is a central component of the shareholder agreement. A successful management buyout requires an adequate strategic assessment and a financing structure that will ensure the company's sustainability. Typically, the purchase is considered a capital transaction, which carries a lower tax rate than if it were classified as ordinary income.