Case Study
Family Limited Partnership (FLP) Equity Sale

Selling a family limited partnership (FLP) interest—especially one tied to a professional firm—can trigger extensive capital gains exposure, with layered federal and state taxes reducing after-sale liquidity. When the original basis is low and the sale price is high, the tax hit can be substantial. Traditional strategies rarely account for advanced structuring opportunities, leaving sellers with limited options to retain more value or optimize the outcome of their life’s work.

The TaxWealth Approach

TaxWealth provides high-net-worth families and business owners with a specialized strategy to exit equity positions while reducing the immediate tax impact. Our approach restructures the transaction to shift the timing of federal and state tax obligations, allowing clients to preserve liquidity, increase after-tax proceeds, and maintain control over how and when their capital is used—all within the boundaries of full tax code compliance.

The Problem

A family limited partnership sold a consulting firm interest for $18,000,000. Under a conventional sale, the total tax liability was $4,605,600, reducing their net after-tax proceeds to $13,394,400. The tax burden significantly reduced available capital, limiting flexibility for reinvestment, estate planning, and wealth preservation.

The Solution

Using TaxWealth’s planning strategy, the partnership legally postponed tax obligations and received a net distribution of $16,392,900. With the added benefit of $378,900 in additional tax savings, the transaction resulted in a 22.4% increase in available capital compared to a traditional sale—maximizing value and preserving future options.

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Our proven approach has helped business owners, real estate investors, and high-net-worth individuals increase their profits by 20-40% through tailored tax strategies. Don’t leave money on the table—discover your tax-saving potential today!