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RD
RD, Certified Public Accountant (CPA)
Category: Tax
Satisfied Customers: 8784
Experience:  CPA, MBA, Over 10 yrs of experience in tax planning and business consulting..
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tax rate on 500,000 dollars

This answer was rated:

how much federal income tax would i pay if i received a check for $500,000 if i sold my business for that amount.

the same for $750,000

Tax liability will depend on the overall gain on sale of the assets of the business-

You will have to allocate the sale price to the depreciable assets, inventories, goodwill and other assets and determine the adjusted cost basis of each of these to determine the tax liability.

Here is a link to preliminary information on this topic

http://www.irs.gov/businesses/small/article/0,,id=98692,00.html

 

Let me know if you have any question. Bonus and Feedback will be highly appreciated!!!

 

Please note: This advice is provided with the understanding that all the relevant facts have been provided by you. Any change in facts might affect the advice given and hence may not be relied on in such cases.

RD and 2 other Tax Specialists are ready to help you
Customer: replied 9 years ago.
Thats what I figured would be involved. Thanks for your answer.
Customer: replied 9 years ago.
Do the same rules apply to an online business that has no physical properties or assets other than the trademarks and domain names and database content (or are those considered assets?)

Yes, it will even apply to online Companies. In that case the sale price will be allocated to the intangible assets such as trademark, database and so on.

If they are self created and not amortized than you may not have any unrecaptured amortization as such and it is possible in that case that most of the gain will be taxed as long term if business has been in existence for more than a year.

Let me know if you have any question. Bonus and Feedback will be highly appreciated!!!

 

Please note: This advice is provided with the understanding that all the relevant facts have been provided by you. Any change in facts might affect the advice given and hence may not be relied on in such cases.