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Preparing a corporation for a sale

If you are planning to sell your corporation in Miami, Florida, there are some important tax matters you must consider. In fact, according to Forbes, if you do not take the time to prepare for these in advance, it could affect the sale contract, lowering potential profits and even creating serious limitations on who can make the purchase. Our goal at Welbaum Guernsey is to ensure that you have all the tools necessary to maximize the proceeds from a sale and avoid contract disputes.

There is a tax on the corporate distributions received by each of your shareholders, as well as the income tax that is applied to the corporation itself. If you are selling your stock, a 15 percent tax could be your only concern. However, if you sell your assets, there are taxes for you and for your shareholders, and these could top a 50 percent combined rate with the regular corporate tax.

When you are planning your sale, you also want to consider the fact that most buyers would prefer to purchase assets, which will allow them to receive a better tax basis, resulting in accelerated depreciation and better deductions. On the other hand, if you sell the buyer stock in your company, they inherit any liabilities as well as the higher tax payment. This is why you may encounter buyers who are not interested in stock purchases as part of the deal.

Whether you are interested in selling a corporation to take advantage of a new opportunity, to change directions or in preparation for retirement, planning ahead can make all the difference in the success of the transaction. Our page on business transactions can provide you with more information. 

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