8 Illustrative Match Profiles · California Sellers

Which of these match scenarios looks like you?

Each card below is an illustrative seller profile, not a past client of mine, showing what the SIS / CRT math looks like for that situation. The break-even yields (typically 7-11%) are what cash would need to earn every year, for the full term to match the structured path. No conservative investment reliably pays that.

These are educational match profiles: illustrative scenarios using simplified 2026 California + federal tax assumptions. Use them to identify whether your situation matches a profile that typically benefits from SIS or CRT, then run the calculator for your actual numbers.
Koreatown apartment building exterior
Long-Tenure CA Apartment Owner

Koreatown 12-unit · 72-year-old retired landlord · $2.8M sale

Bought 1988 for $400K · Living on Social Security + small rental income from one other building
Cash would need
8.4%
every year, with no down years

The Profile

Sale price$2,800,000
Basis$400,000
Gain$2,400,000
Ordinary income$120,000
Age / Filing72 · MFJ
Optimal SIS30 years @ 4.5%

What the calculator shows

Cash Sale
$3,210,400
After tax + 30yr investment income at 4.5% × 0.68
SIS, 30 years
$3,790,500
$14,700/mo fixed for 30 years (assignment company, funded by a fixed annuity)
The Result
$580,100 more with SIS, AND the payment schedule is fixed in the contract.
For cash to match the SIS, your investments would need to earn a steady 8.4% annually for 30 years. Treasuries pay 4.5%. Investment-grade corporates 5.5-6%. Nothing safe pays 8.4%. The seller chose certainty + more money over the cash-and-pray alternative.
Coastal California home
Newport Beach Long-Tenure Homeowner

$4M home sale, MFJ couple, age 68/66 · gain above §121 exclusion

Bought 1995 for $700K · Empty nest, downsizing, both retired
Cash would need
9.2%
every year, with no down years

The Profile

Sale price$4,000,000
Basis (with §121 exclusion applied)$1,200,000
Taxable gain$2,800,000
Ordinary income (SS + small pension)$90,000
Age / Filing68 / 66 · MFJ
Optimal SIS25 years @ 4.5%

What the calculator shows

Cash Sale
$4,420,000
After §121 + capital gains tax, plus 25yr investment income
SIS, 25 years
$5,180,000
$21,000/mo on a fixed schedule, gain stays in 15% LTCG bracket every year
The Result
$760,000 more with SIS, on a fixed payment schedule (illustrative).
Required cash-investment yield: 9.2% a year, every year for 25 years. That's impossible from fixed income. The seller would have to take real equity risk every year for 25 years to match. The SIS delivers that income contractually.
Modern dental office
Dental Practice Sale + Retirement

62-year-old dentist · $2.5M practice sale · all goodwill

Built practice over 30 years · zero depreciable basis · retiring at 65
Cash would need
7.8%
every year, with no down years

The Profile

Sale price$2,500,000
Basis (negligible, goodwill)$50,000
Gain$2,450,000
Current income (still practicing 3 more years)$200,000
Income at age 65 (retired)$80,000
Optimal SIS: DEFERRED STARTStart at 65, 25 years

Why deferred-start works perfectly here

The seller is at $200K current income, so bracket compression is only partial. But they're retiring in 3 years. A deferred-start SIS means zero gain recognition for 3 years (while still earning $200K). At age 65, payments start, income drops to $80K, and the bracket compression jumps to MAXIMUM.

Cash Sale (Year 1 = top bracket)
$2,910,000
$870K tax in Year 1, then invested
SIS, Deferred to 65, 25yr term
$3,460,000
3-yr deferral (zero tax), then $14,200/mo at age 65 retirement-bracket rates
The Result
$550,000 more with deferred SIS.
Required cash yield to beat: 7.8% a year, every year. The deferral converts a "top-bracket year" tax catastrophe into "retirement-bracket years" of optimal recognition. This is the play for any seller selling NOW but retiring LATER.
HVAC contractor truck
HVAC Contractor Selling Business

58-year-old contractor · $3M company sale · semi-retirement

Built since 1995 · 22 employees · plans to consult 5 more years then fully retire
Cash would need
10.1%
every year, with no down years

The Profile

Sale price$3,000,000
Basis (equipment + minor goodwill)$200,000
Gain$2,800,000
Income (now / consulting)$250,000 → $80,000 at age 63
Age / Filing58 · MFJ
Optimal SIS: DEFERRED 5yrStart at 63, 25-year term
Cash Sale
$3,640,000
After-tax proceeds invested at 4.5% × 0.68 for 30 years
SIS, 5yr defer + 25yr pay
$4,580,000
Zero income for 5yr while still consulting at $250K, then payments begin when income drops
The Result
$940,000 more with deferred SIS.
Required cash yield: 10.1% a year, every year for 30 years. Mathematically impossible from any fixed-income product. Even a 60/40 portfolio averaging 10% net over 30 years is a stretch with bad years. The SIS just pays.
Pasadena apartment building
Young Inheritor

45-year-old · inherited $3.5M Pasadena apartment building · selling 2 years post-inheritance

Stepped-up basis $2.5M at inheritance · gain only $1M · earning $120K W-2
Cash would need
6.5%
every year, with no down years

The Profile

Sale price$3,500,000
Basis (stepped-up at inheritance)$2,500,000
Gain$1,000,000
Ordinary income (W-2)$120,000
Age / Filing45 · MFJ
Optimal SIS20 years @ 4.5%

The young-seller advantage

This seller is 45, well under 59½. SIS payments are §453 installment income, NOT §72(q) annuity income, so there's no 10% early-withdrawal penalty. A 20-year SIS pays them until age 65 with no penalty exposure. Cash-into-MYGA at age 45 would face the §72(q) penalty on any withdrawals.

Cash Sale + Invest
$3,380,000
After tax + 20yr investment income
SIS, 20 years, no 59½ penalty
$3,690,000
$14,800/mo for 20 years, gain in 15% LTCG bracket throughout
The Result
$310,000 more with SIS + zero 59½ penalty risk.
Required cash yield to beat: 6.5%. This particular case is the closest to "beatable", but Treasuries pay 4.5%, and the seller takes risk to chase a steady 6.5%. The SIS removes that risk AND adds the structural advantage of no 59½ penalty.
Strip mall retail center
Strip Mall Owner · 25-Year Holder

75-year-old · $3.5M Anaheim strip mall · zero mortgage, Social Security only

Bought 1999 for $600K · exhausted by management · charitable inclination present
Cash would need
8.7%
every year, with no down years

The Profile

Sale price$3,500,000
Basis$600,000
Gain$2,900,000
Ordinary income (SS only)$60,000
Age / Filing75 · MFJ
SIS (10-year shorter due to age)10 years @ 4.0%

Why 10 years and not 30 here

The seller is 75. A 30-year structure runs to age 105, beyond realistic life expectancy. 10 years aligns with the seller's planning horizon, generates higher monthly income, and preserves spousal continuation (period certain). For older sellers, shorter SIS structures with higher monthly income are often the better fit.

OR consider CRT given charitable interest

This seller mentioned wanting to support their hospital. A CRT funded with the property would eliminate the entire $1.04M capital gains tax bill AND generate a $500K-$700K charitable deduction (varies with age + payout rate), AND pay them lifetime income, AND leave the remainder to their hospital. Often beats SIS net economics for charitably-inclined high-income sellers (see the calculator's CRT scenario).

Multi-unit apartment building
Apartment Complex w/ Heavy Recapture

65-year-old · 16-unit Long Beach building · $4.5M sale, $800K recapture

25 years of straight-line depreciation leaves $800K of unrecaptured §1250 gain
Cash would need
7.3%
every year, with no down years

The Profile

Sale price$4,500,000
Basis$400,000
Depreciation recapture (§1250)$800,000
Gain spread by the SIS (incl. §1250)$4,100,000
Ordinary income$80,000
Optimal SIS25 years @ 4.5%

How the calculator handles recapture

Unrecaptured §1250 gain is not §453(i) recapture. In a structured sale it is reported as the payments arrive, and Treas. Reg. §1.453-12 takes it out first, so the $800K is taxed (at up to 25% federal plus California) in the early payment years instead of at closing. Nothing has to be held back to pay it: the full $4,500,000 is structured and the whole $4.1M gain is spread over 25 years. On a cash sale the $800K is taxed in the year of sale with everything else. Only §1245 recapture on equipment is taxed in the year of sale either way.

Cash Sale (with full recapture)
$4,490,000
Recapture + LTCG + CA tax + 25yr invest
SIS (full $4.5M structured)
$5,300,000
$25,300/mo for 25 years, §1250 taxed first
The Result
$810,000 more with SIS, recapture included.
Required cash yield to beat: 7.3% a year, every year. The recapture doesn't kill the SIS, and no cash has to be set aside for it at closing. The §1250 gain rides in the payments and is taxed first.
Bel Air luxury mansion
Bel Air Mansion · §453A Territory

70-year-old · $8M Bel Air home · §453A threshold considerations

Bought 1992 for $1.5M · §121 takes $500K · taxable gain $6M · multiple rental properties
Cash would need
6.8%
every year, with no down years

The Profile

Sale price$8,000,000
Basis (post-§121)$2,000,000
Taxable gain$6,000,000
Ordinary income$250,000
§453A thresholdPremium > $5M triggers interest charge
Optimal split-tranche$5M SIS + $3M cash

The §453A split-tranche play

Premium structured cannot exceed $5M without triggering the §453A interest charge (annual interest on deferred tax above the threshold). The fix: take $3M as cash at closing, structure exactly $5M. Cash carveout covers the §121-excluded portion's tax burden plus liquidity for the seller's next home purchase. The $5M structured premium gets all the bracket-compression benefits at zero §453A cost.

Full Cash Sale
$8,640,000
$2.4M tax + 20yr invest income
$3M cash + $5M SIS, 20yr
$9,440,000
$3M to seller Year 1 + $25K/mo from structured portion
The Result
$800,000 more with the split-tranche SIS.
Required cash yield: 6.8% a year on the full after-tax proceeds for 20 years. Even at "low" 6.8%, no safe instrument reliably pays this. The split-tranche eliminates §453A entirely while giving the seller meaningful Year-1 cash liquidity.
Model YOUR specific case
Before you read further

What is the tax bill on your sale going to be?

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.

Hans Goldstein, EA
Admitted to practice before the IRS

No retainer · no obligation. Hans Goldstein, a licensed insurance agent (CA Insurance License #4273294), will contact you and may discuss insurance products, including annuities.

Want to see your own numbers?

The calculator runs your sale price, basis, income, and filing status through the same math used in these case studies. Get an instant comparison of cash vs SIS vs CRT, the optimal structure for your profile, and the exact break-even yield your cash investments would need to beat.

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Hans Goldstein, NPN 20602398

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A plain-English guide for sellers on how a structured installment sale defers the tax when you sell a business, practice, or property. It covers the math, the alternatives, and how to tell if your deal fits.

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Hans Goldstein, EA
Admitted to practice before the IRS

📞 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.

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