Tax
Aug. 23, 2022
Business seller’s bonanza: capital gains (not ordinary income) tax
Happily, the Internal Revenue Code has a rule that should allow Seller and Buyer to salvage their initial handshake deal.
When it comes to the purchase and sale of a closely held business, lawyers are viewed as “deal killers.” Why?
Consider this example: Seller agrees to sell his business to Buyer for $10 million – a price they both deem fair. They shake hands.
Seller meets with his counsel, Adam Attorney. Adam asks Seller: “You will be taxed at capital gains rates, right?” Seller thinks about the difference between his 50% combin...
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