Mitigate Capital Gains Tax on Business Sale w/ OZ Investing

This article from SmartAsset, written by Rebecca Lake, dives into the tax implications of selling a business, and offers a few strategies to defer and reduce the tax bill after the sale. 

"There’s a lot to consider when selling a business and tax planning is at the top of the list. When you sell a business or business assets at a profit, the IRS expects to receive a cut in the form of capital gains tax. That could potentially result in a larger-than-expected tax bill. If you’re in the initial stages of planning your exit, it’s important to know how to avoid capital gains tax on a business sale."

One strategy to mitigate the capital gains tax liability is Opportunity Zone investing. "Business owners can defer capital gains tax through December 31, 2026, by reinvesting capital gains from the sale of a business into an Opportunity Zone. To qualify for this tax break, any capital gains must be reinvested within 180 days of the sale. While this doesn’t make the capital gains tax disappear, it does allow you to defer payment."

Please read the full article here in SmartAsset