7 Keys to Deducting it All » Selling

Q&A: I also obviously want to reduce my taxes when selling my s corp small business.?

Fri, 26 Oct 2012 20:01:30 +0000

Question by John c: I also obviously want to reduce my taxes when selling my s corp small business.?
I have a lawn care company, so that the value is more on the customer contracts then actual assets of property or equipment. I am a senior citizen and a retired servicemember. does either of these help to lower taxes? but basically what will be my % rate of taxes when i sell? i have two buyers interested right now.

thanks john

Best answer:

Answer by jdkilp
This is too complicated to address by forum. Contact a local accounting firm and ask advice. They should be able to do this in one visit (about an hour) — will cost you about $ 200 for the advice. You can also try contacting the local Small Business Development Center office (google it for the office nearest you). They will advise you for free, but the advice won’t be as good as the accounting firm.

Know better? Leave your own answer in the comments!

selling small business avoid taxes?

Sat, 11 Aug 2012 00:33:18 +0000

Question by : selling small business avoid taxes?
Someone I know is thinking of selling their business so they can take all the profits instead of taking out the retained earnings which would be taxed really hard but selling the business is no tax so its better right?

Best answer:

Answer by michael971
A CPA could answer that question

Give your answer to this question below!

What are CA taxes on selling a small business to just pay off business debt?

Sat, 04 Feb 2012 02:28:42 +0000

Question by tonka: What are CA taxes on selling a small business to just pay off business debt?
We own a auto repair shop in CA and just want out for what we owe on it (40K). If we sold it to one of our employess for the incrued debt, would we still have to pay taxes eventhough we wouldn’t be walking away with any profit? We do not own the property-just the goods. Thanks for any advise

Best answer:

Answer by Spock (rhp)
you’ll need to calculate the cost of the goods that’ll be purchased, plus any cost you incurred in starting the business, and the remaining tax value of any capital assets included in the sale.

the difference between what you get for it [relief from the debt] and the cost is taxable income.

can’t imagine it’ll be very much, possibly even negative [which is a deductible capital loss up to $ 3,000 per year].

Give your answer to this question below!

How do i minimize taxes when selling a small business?

Sun, 01 Jan 2012 11:44:01 +0000

Question by John O: How do i minimize taxes when selling a small business?
I’m selling a business and obviously want to minimize taxes.

It is an S corporation, in WA state.

I’m fimiliar with the 1031 exchange but was wondering if there are other options.

Regardless of the 1031 I need to reinvest the majority of the money into 2 businesses.

Thanks.

Best answer:

Answer by Pobept K
you need a good tax accountant or attorney

Know better? Leave your own answer in the comments!

How do i minimize taxes when selling a small business?

Sun, 01 Jan 2012 11:44:01 +0000

Question by John O: How do i minimize taxes when selling a small business?
I’m selling a business and obviously want to minimize taxes.

It is an S corporation, in WA state.

I’m fimiliar with the 1031 exchange but was wondering if there are other options.

Regardless of the 1031 I need to reinvest the majority of the money into 2 businesses.

Thanks.

Best answer:

Answer by Pobept K
you need a good tax accountant or attorney

Give your answer to this question below!

How do I minimize taxes Selling a small business s corporation?

Wed, 26 Oct 2011 06:46:52 +0000

Question by John O: How do I minimize taxes Selling a small business s corporation?
I’m selling a business and obviously want to minimize taxes.

I’m fimiliar with the 1031 exchange but was wondering if there are other options.

Regardless of the 1031 I need to reinvest the majority of the money into 2 businesses.

Thanks.

Best answer:

Answer by naekuo
Without knowing the complete picture, I can only offer the following advice.

A. With 1031, you point out you still need to reinvest it. Do you want to reinvest and postpone the gain? And wait until something happen and step-up method without paying the income tax. Remember if Republican take over, they will have no Estate Tax. And there is no step-up.

B. With the current tax rate, you may want to consider sale the S corp as sale of stock.

Sale of Stock vs. Sale of Assets

When you sell stock, gains or losses are generally treated as capital gains or losses. Some items — goodwill, most real property gains, and any appreciation over the original cost of equipment — qualify as capital gains.

On the other hand, when you sell individual business assets, such as inventory or equipment, much of the gain is considered ordinary income. Gains from inventory, publicly traded securities, and depreciation recapture are not eligible for installment reporting. And if you offer seller financing, you should know that if the total value of installment payments exceeds $ 5 million in a year, interest is charged on deferred taxes.

You never know when the change of Congress (more Democrats) and possible change of Presidency and expiring tax code. Your capital gain rate may rise from 15% to 25%. Remember you may save 10%.

http://www.finance.cch.com/text/c60s10d459.asp

“The advantage of capital gains, as opposed to ordinary income, is that the basic maximum tax rate on capital gains for property held for more than one year is currently 15 percent through the end of 2010. In contrast, the top four ordinary income tax rates are all higher than this, with the top rate through 2010 at 35 percent”

Add your own answer in the comments!