Here's the way my experience went. They former owner of our shop had an LLC, and then operated under a trade name. When I purchased the business, the contract was written so that I only purchased the assets - customer lists, art files, equipment, goodwill, and the name (which I assumed with a DBA). The liabilities (other than a few that I knowingly and willingly assumed) remained the responsibility of his corporation. This way I was never surprised when an old creditor called asking about a bill from 1 1/2 years ago. I simply directed them to the former owner. Knowing that I couldn't be held liable for any surprises was good security for me.
The only headache was that I had to set up all new vendor accounts. But the advantage was that I didn't get stuck paying any money that he still owed. Though in a few cases I paid things just for simplicity, and then subtracted the amount from my monthly payment to him, as he was holding a note on the business.
Even though, as the seller, the liabilities may not be a big deal to you, you still don't want to turn over all your accounts to him. You may be listed as a personal guarantor on those accounts, and it's not hard to imagine how that could turn into big trouble for you if he doesn't pay his bills. Much easier to make him open his own LLC, get his own EIN, and open his own account. I would even call all the accounts that I can remember and inform them that you're going out of business. But you'll never remember all of them, hence the wisdom in him starting a new company and then purchasing your assets.
