For owners preparing for a sale
Selling is one decision. What comes next is the plan.
Qualified small business stock issued after July 4, 2025 can exclude up to $15 million of gain, but only if the dates on the stock ledger line up. We help owners prepare the sale, keep more of what it brings in, and turn the proceeds into income for the rest of their lives.
The situation
The business has been the balance sheet.
For years most of what you are worth has been one asset. The salary, the retirement plan, and the family’s security have all run through the company, and the personal plan, if there was one, treated it as a line item.
A sale changes that in a single wire. Counsel runs the deal, the CPA estimates the tax, and a banker may manage the process. Each is good at their part, but none of them owns what the proceeds must do afterward, and the decisions that matter most are often made before anyone asks.
That is the work: the personal side of the transaction, built early enough to still have options.
Why it’s complex
Five decisions a sale forces
After-tax proceeds come first
Federal capital gains, the 3.8% net investment income tax, state tax, and deal structure all interact. We model the number you keep before documents are signed, not after.
Read the guideHow the gain is recognized
An installment sale spreads the gain across the years payments arrive, which can keep more of it inside lower brackets. The trade is the buyer’s credit risk.
Read the guideThe year after closing
The sale year is often the highest-income year of a lifetime, and the next is often the lowest. That quiet year is where Roth conversions and gain harvesting are decided.
Read the guideOne asset becomes a portfolio
Proceeds need to be diversified on a schedule that avoids a second tax event, without letting the tax bill veto a sound structure.
Read the guideThe business was the paycheck
Once the salary stops, the portfolio replaces it. The drawdown order and a cash reserve should exist before closing, so the first months are calm rather than improvised.
Read the guideSources: IRC §1202 as amended by P.L. 119-21; IRS Rev. Proc. 2025-32; IRC §1411.
Our approach
Built in the order the deal unfolds
We hold the personal side of the transaction: the after-tax model, the charitable structure, the income plan, and the coordination among your advisers. Bankers and transaction counsel run the deal; we make sure the plan is ready when it closes.
Confirm the structure and the clock
QSBS applies only to C-corporation stock, and the issuance date decides which rules govern. Stock issued before July 4, 2025 keeps the prior $10 million, five-year regime. We review the ledger with your CPA while a reorganization is still worth considering.
Make any gift while it is still a gift
Shares given to a donor-advised fund or charitable trust before a binding agreement are generally deductible at fair market value, and the charity’s later sale carries no gain to you (IRC §170). After signing, the gift can be recharacterized as an assignment of income.
Choose how the gain lands
A lump sum recognizes everything in one year; an installment sale spreads it as payments arrive (IRC §453). We compare both against the brackets, the surtax line, and the strength of the buyer.
Turn proceeds into a paycheck
The reserve, the income portfolio, and the drawdown order go live, and our Quarterly Rounds keep cash flow, risk, estate, and tax in sequence. With the estate now liquid, we review the $15 million 2026 exemption with your attorney.
The work
What you’ll work through with us
- An after-tax model of the sale under lump-sum and installment structures
- A QSBS eligibility review of issuance dates and entity type, with your CPA
- Pre-sale charitable planning with donor-advised funds and charitable remainder trusts
- A diversification schedule that avoids a second tax event
- An income plan and cash reserve that replace the salary
- Roth conversion and gain-harvesting sizing for the low-income year after closing
- Estate and beneficiary updates, coordinated with your attorney
- One point of coordination among counsel, the CPA, and the banker
Exit planning at the firm is led by Theo Halbardier, CFP®, CIMA®, CAIA®, the firm’s founder. We are fee-only: no commissions, no product sales. About Theo
Questions
Common questions from business owners
How early should the personal planning start?
Eighteen to thirty-six months before a likely closing. Entity structure, QSBS eligibility, and any pre-sale gift all depend on timing that cannot be recovered once a letter of intent is signed.
Do you value the business or run the sale?
No. Investment bankers, brokers, and transaction counsel run the deal. We hold the personal side: the after-tax model, the charitable structure, the income plan for afterward, and the coordination among the advisers.
Our company is an S corporation. Does QSBS apply?
The exclusion applies only to C-corporation stock (IRC §1202). Whether a conversion makes sense depends on the timeline, since the holding-period clock starts at issuance. That is a question we would work through with your CPA and counsel well before a sale.
Is an installment sale worth the risk?
Sometimes. Spreading the gain can keep more of it in lower brackets and below the surtax line, but the seller becomes a lender to the buyer. We weigh the tax saved against the security of the note, its interest rate, and what the proceeds must fund.
What happens to our plan after the wire arrives?
The proceeds become the paycheck. We build the drawdown order, the reserve, and the estate coordination before closing, so the first months after the sale are calm rather than improvised.
How are you paid?
We are fee-only and receive nothing from any transaction, product, or referral. Our compensation comes from clients alone.
Reviewed by Theo Halbardier, CFP® · Updated September 2026 · Figures current for 2026
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