FAQ

How much tax will I pay on the sale of my company?

Direct answer

It depends on the structure, the asset allocation, and your basis, which is why the tax analysis has to happen before the structure is negotiated rather than after.

More detail

The main variables are whether the transaction is an asset or a stock sale, how the purchase price is allocated across asset classes in an asset sale, the seller's basis in the entity and in the assets, the entity type, and state tax treatment in North Carolina or South Carolina. Depreciated equipment can generate ordinary-income recapture, goodwill is generally treated differently, and the allocation is negotiated between buyer and seller because their interests are opposed. Planning strategies exist and most of them require lead time, so the right sequence is to bring a transaction-experienced CPA in during preparation, model the after-tax proceeds under two or three structures, and let that analysis shape what you accept. This site does not give tax advice; the modeling belongs with your CPA.

Authoritative sources

Ready to get started?

Charlotte-region owners of $5M to $20M industrial companies get a confidential valuation range from a mid-market M&A advisor, at no cost. Mon-Fri 8am-6pm ET.

Call (704) 343-6770Text us

Prefer to text? Open your texting app