Selling Assets

Before selling assets, don’t forget to consider the taxes. Whether you’re selling a business, a house, cryptocurrencies, or stocks, asset sales are taxed. Capital gains taxes are based on profits that have been realized and the rates depend on the type of asset sold, the seller’s taxable income, and how long the asset was owned. There is a way to avoid paying capital gains taxes on the sale of your home if it was your primary residence and you lived there for two out of the past five years. But if you were to sell your second home or rental properties, you would pay capital gains taxes. 

Business owners who have grown their business and are ready to sell can choose to have an asset sale or stock sale, depending on the type of business. There is a lot of planning that is needed to facilitate the sale of company stocks. Corporations need a valuation to accurately calculate the company’s worth. They’ll need the assistance of a business broker or attorney who is experienced in finding buyers, drafting legal documents, navigating tax laws, and closing deals. Asset sales for a business can be complicated due to the various types of assets sold and how they are taxed, either by ordinary income tax rates or capital gains rates or both. There are positives and negatives to both, but it is nice to have options. 

Stock sales are simple and straightforward and are taxed in the tax year the stock is sold or the dividend payment is made. The sale of any asset takes strategy, and your fiduciary financial advisor can help you choose the ideal time to incur the tax bill. Call Alloy Wealth Management at 800-689-3935 if you have questions about tax planning and asset sales, or would like to schedule a meeting with one of our fiduciaries.