How About Taxes?
Selling Your Business? Taxes Are Key
Business owners often talk of selling out to retire, move away, capitalize on a hot market or simply do something else. Right now, sales of small businesses are up. And sales mean taxes. See Sales of Small Firms Are Up. Big or small, if you have a business, taxes should influence—or even control—how you sell.
This is so whether you’re talking about a home-based internet business producing $20,000 a year or a huge conglomerate producing $20 billion. Business sales are surprisingly consistent in concept, documentation, legal and tax rules across a wide spectrum of size and type. And taxes are inevitable.
http://www.forbes.com/sites/robe...
Selling Your Business -Deal Structure And Taxes
What you need to know about taxes and deal structures in the sale of a business.
The purpose of this article is to demonstrate the importance of the tax impact in the sale of your business. As an M&A intermediary and member of the IBBA, International Business Brokers Association, we recognize our responsibility to recommend that our clients use attorneys and tax accountants for independent advice on transactions.
As a general rule, buyers of businesses have already completed several transactions. They have a process and are surrounded by a team of experienced mergers and acquisitions professionals. Sellers on the other hand, sell a business only one time. Their "team” consists of their outside counsel who does general business law and their accountant who does their books and tax filings. It is important to note that the seller’s team may have little or no experience in a business sale transaction.
http://www.businessknowhow.com/m...
Taxes And Selling Your Internet Business
Tax consequences should be an important part of every business owners exit strategy, especially in today’s political environment. There are two areas of taxation that need addressing. One is the structure of the deal, asset sale vs selling a corporation the other is the tax rates associated with those types of transactions. On the political front, unless acted on by Congress the Bush tax cuts are set to expire at the end of this year. Income taxes, unearned income taxes, capital gains taxes, estate taxes and more will rise most definitely for those families with incomes greater than $250,000. Be sure to visit with your accountant now for adequate tax planning and if you are thinking of selling your business be sure to speak with a veteran internet business broker to plan your exit. It is extremely important to understand how a structure of deal can impact your taxes. A buyer often with many deals under his/her belt is looking for the best tax advantages. These same advantages do not apply to the seller. When it comes to selling your internet business the most advantageous deal structure would be for the buyer to acquire the corporation instead of the assets within it. In this case the deal is subject to capital gains taxes. Buyers on the other hand, usually on the advise of their attorneys, are reluctant to assume the liabilities that may come with the corporation. Buyers would prefer to buy the assets and structure the deal in which those assets can be depreciated at the fastest rate. It is imperative that when selling your business you work with the experts so you have a thorough understanding on how best to structure a deal.
http://www.imergeadvisors.com/ta...
Selling Your Business Before Taxes Rise
Posted by Daniel B. Eagan on Jun 1, 2012 in AllianceBernstein, Americas, Wealth Management | 0 comments
Planning to sell your business? Try to wrap up the deal before year end, when today’s highly favorable US capital gains tax rate is scheduled to expire.
The federal long-term capital gains tax rate now tops off at 15%. If Congress does not act, on January 1, 2013, it will shoot up to 23.8%, including a 3.8% healthcare surcharge for individuals with incomes over $200,000.
How much difference could that make? Let’s say you’ve received an offer of $50 million for your business. Selling it this year and paying 3% in transaction costs would leave you with $41.2 million and the US Treasury with $7.3 million (assuming you live in a state without its own capital gains tax). The same transaction in 2013 would net you only $37.0 million, with $11.5 million ($4.2 million more) going to the government.
http://blog.alliancebernstein.co...
Tag Archives: Taxes On Selling A Business
You may be looking ahead and wondering ‘who is going to own my business after me?’ Many owners look to their management teams as an exit planning strategy, the very people who helped them grow the business as potential future purchasers.
This is a natural thought process for many owners because it provides a unique opportunity for managers to become owners. After all, where else are your managers going to get this opportunity . . . unless, of course, it is in competition with you. If you’ve considered an internal transfer of ownership to your managers, one of the most important first steps that you need to take in answering this question is figuring out how the math of an internal transfer would work for you. Read more...
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