EXIT PLAN STRATEGIES
Defer capital gains taxes in your selling situation, by applying IRS-approved strategies.
Choose your circumstance:
EXIT PLAN STRATEGIES
Defer capital gains taxes in your selling situation,
by applying our IRS-approved strategies.
Choose your circumstance:
EXIT PLANNING
Richard owns a fabrication
business in the oil & gas industry.
And now, he’s ready to sell…
SELLING MY BUSINESS
Richard owns a fabrication business in the oil & gas industry.
And now, he’s ready to sell…
SELLING MY BUSINESS
SELLING BUSINESS
Richard owns a fabrication business in the oil & gas industry.
Now, he’s ready to sell…
RICHARD'S
SITUATION
Having poured his soul into building and managing the company, he is prepared to reap the benefits of years of hard work.
Richard knows his business is worth roughly $5 million, but now realizes he will have to give up approximately $1 million in capital gains taxes alone, not to mention what this lump sum gain will do to his ordinary income tax brackets.
After research, Richard is prepared to explore how the strategies and expertise of Matthew James Tax Pros could defer his capital gains tax burden, enabling him to retain more of his profit and potentially grow the principal.
RICHARD'S
SITUATION
Having poured his soul into building and managing the company, he is prepared to reap the benefits of years of hard work.
Richard knows his business is worth roughly $5 million, but now realizes he will have to give up approximately $1 million in capital gains taxes alone, not to mention what this lump sum gain will do to his ordinary income tax brackets.
After research, Richard is prepared to explore how the strategies and expertise of Matthew James Tax Pros could defer his capital gains tax burden, enabling him to retain more of his profit and potentially grow the principal.
After research, Richard is prepared to explore how the strategies and expertise of Matthew James Tax Pros could defer his capital gains tax burden, enabling him to retain more of his profit and potentially grow the principal.
RICHARD'S SITUATION
Having poured his soul into building and managing the company, he is prepared to reap the benefits of years of hard work.
Richard’s business is worth roughly $5 million, but realizes he will have to give up approximately $1 million in capital gains taxes, not to mention what this lump sum gain will do to his ordinary income tax bracket.
Ross and Cathi purchased
rental property as an investment
on a small street in the suburbs.
Now looking to retire,
they’re ready to sell and
move to the country…
SELLING MY REAL ESTATE
Ross and Cathi purchased
vacant land as an investment on a small street in the suburbs.
Now they’re ready to sell, retire, and move to the country…
SELLING MY REAL ESTATE
SELLING REAL ESTATE
Ross and Cathi purchased
vacant land as an investment on a small street in the suburbs.
Now, they’re ready to sell & move…
Throughout the years, their street has become a major thoroughfare, and the value of their real estate investment has increased tenfold. Because they purchased the land years ago, the asset is fully depreciated, with the cost basis remaining low.
Their capital gains tax burden will be substantial, totaling $420,000; and their ordinary income tax bracket for the year will adjust.
ROSS' & CATHI'S
SITUATION
Because of this, Ross & Cathi are looking for a 1031 exchange alternative – something that can help defer some of the capital gains without obligating them to invest in more real estate.
They’ve contacted the team at Matthew James Tax Pros to learn about strategies that could restructure their gains, reduce their taxes, and divert the money for retirement savings, which would otherwise go to the IRS.
Because of this, Ross & Cathi are looking for a 1031 exchange alternative – something that can help defer some of the capital gains without obligating them to invest in more real estate.
They’ve contacted the team at Matthew James Tax Pros to learn about strategies that could restructure their gains, reduce their taxes, and divert the money for retirement savings, which would otherwise go to the IRS.
ROSS' & CATHI'S SITUATION
Throughout the years, their street has become a major thoroughfare, and the value of their real estate investment has increased tenfold. Because they purchased the land years ago, the asset is fully depreciated, with the cost basis remaining low.
Their capital gains tax burden will be substantial; and their ordinary income tax bracket for the year will adjust.
ROSS' & CATHI'S SITUATION
Throughout the years, their street has become a major thoroughfare, and the value of their real estate investment has increased tenfold. Because they purchased the land years ago, the asset is fully depreciated, with the cost basis remaining low.
Their capital gains tax burden will be substantial; and their ordinary income tax bracket for the year will adjust.
Because of this, Ross & Cathi are looking for a 1031 exchange alternative – something that can help defer some of the capital gains without obligating them to invest in more real estate.
They’ve contacted the team at Matthew James Tax Pros to learn about strategies that could restructure their gains, reduce their taxes, and divert the money for retirement savings, which would otherwise go to the IRS.
Capital Gains Tax-Saving Scenarios
NEW YORK CITY
LOS ANGELES
CHICAGO
NEW YORK CITY
CASE STUDY: COMMERCIAL PROPERTY SALE
Sales proceeds after commissions & closing costs: $20,000,000
Seller's Original Basis: $5,000,000
Capital Improvements: $1,000,000
Depreciation: $4,000,000
Mortgage Balance at time of closing: $2,000,000
Seller's adjusted basis [purchase price + capital improvements - depreciation]: $2,000,000
Taxable gain [net sales proceeds minus adjusted basis]: $18,000,000
Federal Tax
[unrecaptured section 1250 gain applies]: 20-25%
NY State & City Tax: 12.7%
Medicare Tax: 3.8%%
Sales proceeds after commissions & closing costs: $20,000,000
Seller's Original Basis: $5,000,000
Capital Improvements: $1,000,000
Depreciation: $4,000,000
Mortgage Balance at time of closing: $2,000,000
Seller's adjusted basis [purchase price + capital improvements - depreciation]: $2,000,000
Taxable gain [net sales proceeds minus adjusted basis]: $18,000,000
Federal Tax
[unrecaptured section 1250 gain applies]: 20-25%
NY State & City Tax: 12.7%
Medicare Tax: 3.8%%
Approximate tax due WITHOUT deferring tax on capital gains:
$6,770,000
Approximate tax due WITH deferring tax on capital gains:
WITH deferring tax on capital gains:
$0
LOS ANGELES
CASE STUDY: COMMERCIAL PROPERTY SALE
Sales proceeds after commissions & closing costs: $4,000,000
Seller's original basis: $400,000
Mortgage balance at time of closing: $300,000
IRC sec.121 exclusion
[$250,000 per owner residing there for two of the last five years]: $500,000
Seller's adjusted basis
[purchase price + section 121 exclusion]: $900,000
Taxable gain
[net sales proceeds minus adjusted base]: $3,100,000
Federal Tax: 20%
CA State & City Tax: 13.3%
Medicare Tax: 3.8%
Sales proceeds after commissions & closing costs: $4,000,000
Seller's original basis: $400,000
Mortgage balance at time of closing:
$300,000
IRC sec.121 exclusion
[$250,000 per owner residing there for two of the last five years]:$500,000
Seller's adjusted basis
[purchase price + section 121 exclusion]: $900,000
Taxable gain
[net sales proceeds minus adjusted base]: $3,100,000
Federal Tax: 20%
CA State & City Tax: 13.3%
Medicare Tax: 3.8%
Approximate tax due WITHOUT deferring tax on capital gains:
$1,500,100
Approximate tax due WITH deferring tax on capital gains:
$0
CHICAGO
CASE STUDY: COMMERCIAL PROPERTY SALE
Sales proceeds after commissions & closing costs: $10,000,000
Seller's original basis: $0
Business loan balance at time of closing: $250,000
Taxable gain
[net sales proceeds minus adjusted base]: $10,000,000
Federal Tax: 20%
IL State Tax: 4.95%
Medicare Tax [does not apply to this situation]: 3.8%
Sales proceeds after commissions & closing costs: $10,000,000
Seller's original basis: $0
Business loan balance at time of closing: $250,000
Taxable gain
[net sales proceeds minus adjusted base]: $10,000,000
Federal Tax: 20%
IL State Tax: 4.95%
Medicare Tax [does not apply to this situation]: 3.8%
Approximate tax due WITHOUT deferring tax on capital gains:
$2,495,000
Approximate tax due WITH deferring tax on capital gains:
$62,375
Every situation is different and actual results may vary.
Ready to defer your taxes
or gain more knowledge?
rolling on structuring a beneficial financial plan.
Ready to defer your taxes
or gain more knowledge?
Fill our form and we’ll reach out to get the ball rolling on structuring a beneficial financial plan.
