NEED YOUR HELP: Seller is concerned about tax liability...Suggestions PLEASE

by a searcher

1 week ago

Searchfunder community....I am seeking help! If a seller is planning to sell their business in###-###-#### Are you aware of any strategies that can help them lower their tax burden/capital gains tax? What comes to mind for me are.....increase the seller note or consider roll over equity. What do you think?

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searcher from University of Pennsylvania - The Wharton School

A knowledgeable financial advisor and estate attorney team can be helpful to them here as well in the event they are interested in setting up a trust for example that is appropriate to their goals and value system. The timing of this setup matters from a tax perspective and there are many options. For example, if the seller is charitably inclined, there are special trusts that allow for multiple beneficiary types (charities, children/heirs, and the seller his/herself during retirement). If they have children with special needs, there are solutions there, etc. Your seller needs a stronger team around them in addition to a CPA and possibly a CEPA. ~^Searchfunder member‌

1 week ago | like reply | 0 likes

professional from Utah Valley University - Woodbury School of Business

There are many options to look into, including the two you mentioned (seller note and rollover equity), QSBS, and others. As ^Searchfunder member‌, the accountants on both sides need to be involved to ensure the proper structures are in place.

My firm is not a CPA firm, but we work with CPA firms on transactions. We are, however, a fractional CFO (and executive) firm and have a team that focuses on financial due diligence (QofE, etc.). I wanted to manage expectations that I am not providing tax advice.

1 week ago | like reply | 0 likes

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