Same price, very different after-tax result. Asset vs. stock sale and how the price is allocated decide whether your proceeds are taxed as capital gain or ordinary income. Have this conversation before the LOI.
Two business owners sell identical companies for the same price, and one keeps far more after tax than the other. The difference isn't the number on the contract. It's how the sale was structured: as an asset sale or a stock sale, and how the price was allocated. This is where business-tax knowledge is worth real money.
Send me the sale price and rough basis. Within one business day I'll email you the actual number and the Seller's Guide to §453. If it doesn't fit your deal, I'll tell you that plainly.
No retainer · no obligation. Hans Goldstein, a licensed insurance agent (CA Insurance License #4273294), will contact you and may discuss insurance products, including annuities.
Go deeper: asset sale vs stock sale, who wins on tax and how the gap gets paid on Big Sale Tax.
In a stock sale, the buyer purchases your ownership interest; your gain is generally a single capital gain, clean and seller-friendly. In an asset sale, the company sells its individual assets; the buyer usually prefers this (they get a stepped-up basis to depreciate), but it can convert a chunk of your proceeds into higher-taxed ordinary income.
In an asset sale, the price is allocated across asset classes: cash, receivables, inventory, equipment, §197 intangibles, and goodwill. Each class has its own tax character:
How the contract allocates the price literally determines your tax rate. Buyer and seller have opposite incentives here, and both must report the same allocation on Form 8594.
Whichever form the sale takes, taking the proceeds over time rather than in one lump sum can spread the capital-gain portion across years, lowering the bracket, softening the 3.8% NIIT, and avoiding the income cliffs a lump-sum sale triggers.
Depreciation recapture (ordinary income on previously depreciated assets) is generally recognized in the year of sale even under an installment method. It can't be spread. That's exactly why the structure has to be designed before you sign: to maximize the capital-gain portion that can be deferred and plan around the recapture that can't.
Selling a business is not one decision; it's a series of tax choices (entity, sale form, allocation, timing) that together can swing your after-tax result by a fortune. Have those conversations before the letter of intent, not after.
Before you sign anything, run your numbers with someone who structures the deal to be tax-smart and audit-ready from day one.
Call 213-414-2808 Run the Numbers →
Send me the sale price and roughly what you paid. Within one business day I’ll come back with the number you’re actually looking at on a stock position sale, and whether a structured installment sale can push it down. If it can’t, I’ll tell you that just as plainly.
Leave your details and the PDF downloads right away. Within one business day Hans will email a preliminary read on which structure fits your deal. No retainer. On a funded structure, the insurer pays a one-time commission of about 4% of the amount structured to the brokerage firm that places it (Hans’s share is about 2.4%; no trail). It is built into the annuity pricing, not a separate fee.
📞 Hans Goldstein · 213-414-2808 · CA Insurance License #4273294 · Independent §453 specialist · Goldstein & Co. LLC
Hans Goldstein, a licensed insurance agent (CA Insurance License #4273294), will contact you and may discuss insurance products, including annuities.
Hans Goldstein is an Enrolled Agent, admitted to practice before the Internal Revenue Service. Not affiliated with or endorsed by the IRS. General education, not tax or legal advice for your situation.
