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Case Study: Sale of an Event Services Company Located in CO

Problem

The owner of an event services company wanting to sell her business for $2.5 million soon discovered from her CPA that she would be responsible to pay more than $600,000 in federal and state taxes.  This would leave her with just over $1.6 million when escrow closed. She decided to halt the sale of her business until she found a solution to the tax problem.

TaxWealth Solution

Two planning solutions were identified that would solve the tax problem and maximize how much she receives at close of escrow.  The first planning choice allowed her to lawfully defer the taxes for decades and receive more than $2.1 million tax-free when escrow closed, an increase of more than $500,000 as compared to what she would otherwise have gotten after-tax.

Her second planning choice eliminated the taxes entirely, saving $658,605 in capital gains taxes, give her tax-free more than $2.2 million after close of escrow and allow her to save more than $105,000 in income taxes.  She chose the second planning option.

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