Selling Your Med Spa Without the Year-One Tax Hit
The aesthetics consolidator wave hit hard 2022-2024 and is still rolling. Skin Spirit, LaserAway, Alchemy 43, Ever/Body, Frownies, Cure Aesthetics and regional platforms are mostly paying 5-10x EBITDA. A $500K EBITDA med spa = $2.5M-$5M sale price.
Lump sum: federal + state taxes typically eat 38-42% of the deal in year one. §453 deferral on the goodwill portion drops effective rate to 28-32%.
The math: $3.5M med spa sale
Assumptions: $3.5M, 60% goodwill ($2.1M), 25% equipment ($875K in lasers and RF devices), 15% product inventory + retail ($525K).
Med-spa tax wrinkles
- Device §1245 recapture is brutal. CoolSculpting, Fraxel, Picosure, Sciton, Alma, Morpheus8, Sofwave: $100K-$300K devices under MACRS. Recapture at ordinary rates in year one.
- Botox / filler / Sculptra inventory. Ordinary income on sale. Check expiration dates, because product near expiry = write-down.
- State medical-board ownership rules. Most states require physician ownership or MD-supervisor structure (CA Bus & Prof §§2052, 2400, similar elsewhere). MSO/Friendly PC structure common.
- Member / subscription program. Recurring revenue = goodwill character on sale. Higher multiple.
- Provider non-competes. RN injectors, NPs: retention determines goodwill value. Earn-outs often tied to provider retention.
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.
No retainer · no obligation. Hans Goldstein, a licensed insurance agent (CA Insurance License #4273294), will contact you and may discuss insurance products, including annuities.
When this fits
- $1.5M+ sale, high goodwill from membership/recurring revenue
- Consolidator buyer
When it doesn't
- Mostly equipment sale
- Solo provider with no team
How I work
Hans Goldstein, EA, IRC §453 specialist. Admitted to practice before the IRS. Placements with highly rated life insurers (A or better by A.M. Best or equivalent) in all 50 states. Free fit-check.
Frequently asked
Q: I'm a non-physician owner via MSO. Does that change §453? A: No. The MSO/Friendly PC structure affects how the practice is organized but not the §453 mechanic on the sale.
Q: Do Skin Spirit and LaserAway paper §453? A: Yes, routinely.
Find out what your sale is really going to cost you in tax, and what you can do about it
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.
Find out what your tax bill actually looks like before you sell, including the parts your CPA may not raise until the return is already being prepared.
Most people find out what they owe after the sale closes, when nothing can be changed. A short conversation now tells you the number, which layers apply to your situation, and which options are still open while the sale is still in front of you.
- What you will actually owe: federal, the 3.8% surtax, recapture and your state
- Which of those layers you can still do something about
- Whether spreading the sale changes the number in your case
Hans Goldstein · 213-414-2808 · Hans Goldstein: Tax & Exit Planning · This is an educational conversation, not tax advice. Bring your CPA in before you file.
Hans Goldstein, a licensed insurance agent (CA Insurance License #4273294), will contact you and may discuss insurance products, including annuities.
Educational. Not tax or legal advice.
Run your specific numbers
The calculator runs your sale through real 2026 federal + state tax brackets and shows §453 savings vs lump sum side-by-side.
Run the calculator → 213-414-2808