Half a two-shooter photo business for $60k, and the seller keeps saying passive

The bit I don't follow is what 50 percent entitles you to. Half the profit distributed when? Decided by whom? If he holds the other half and runs it, he sets his own compensation and you get whatever's left. I've been reading operating agreements for a few months and that's the clause that seems to decide these things.

Say no on the structure, then decide if you want to reopen it on different terms.

What you'd be buying is one person's ability to keep showing up, and he's already told you he's down to 15 hours a week, which means the second shooter is the business now. So the first question isn't the price. It's whether that second shooter has any reason to stay after the sale. If he's a 1099 with no equity, no non-solicit, and a client list in his phone, he can start his own thing next month and take the brokerage with him. Your $60k is then a van and a list of phone numbers of people who now use someone else.

@sextant is right about monthly revenue by client. I'd add three things to the request. Payroll or 1099 detail for the shooter and the editor so you can see what they actually earn and whether the add-backs are really add-backs. The tax returns next to the internal numbers, because a $311k gross with $118k of owner earnings implies a 38 percent margin and that's high for a two-shooter operation with a van and a subscription stack. And whatever written arrangement exists with the 40 percent client, which I suspect is nothing.

On the passive claim, minority ownership of a small operating business you don't control is not passive income. It's an illiquid position where someone else decides your distributions. If you still like it after the books, the version that's worth doing is a majority position with a seller note, so his payout depends on the earnings continuing, or a straight loan to him with the gear as collateral. Both of those need a lawyer who does small business purchases in your state, and the deadline pressure is a reason to slow down rather than speed up.

The seller note point is the one. If he genuinely believes the earnings hold up without him, he'll take part of the price over three years tied to revenue. If he wants all $60k at closing, he's telling you what he thinks happens next.