Seller has a business and wants to know if he should see the assets or the stock of the corp. CPA said that sale of the stock would produce less tax. Buyer doesnt want to buy stock because of liability exposure. Suggestions?

In the BSA just make the seller liabile for any/all liabilities that occured prior to sale. You need a solid indemnification clause.

Consider the following language:
Indemnification. Seller shall defend, indemnify, and hold harmless Buyer against any and all costs, losses, claims, suits, actions, assessments, liabilities, fines, penalties, damages (compensatory, consequential, and other), and expenses (including reasonable legal fees) in connection with or resulting from:
All debts, liabilities, contingent liabilities and any other obligations of the Business which are not reflected on its _______, 2008, Balance Sheet.
Any inaccuracy in any representation or breach of any warranty of Seller contained in this Agreement or any related agreement.
Any failure by Seller to perform or observe in full, or to have performed or observed in full, any covenant, agreement, or condition to be performed or observed by the Seller under this Agreement or any related agreement.
Further, Seller shall provide an insurance policy to cover all liabilities resulting from the operation of the Business or potential malpractice of the Business’ employees prior to the Closing Date.

An iron-clad indemnification clause will protect the buyer. Buyer should get a discount for buying the stock, as the assets will have a lower basis as they have been depreciated already.