I am selling a small lawn and landscape business and I want to have a basic understanding. I will be meeting with my accountant but before I do-please let me know if I am even close in my train of thought:
Business sale price: $85,000
New owner wants to allocate $27,000 toward equipment- I paid $24,000. I have taken the depreciation for all equipment in the year purchased.
The remaining $58,000 would be goodwill. Is this the amount that would incurr the capital gains tax
(+ the $3,000 from the equipment? Is there any major piece I'm missing (I've read that I need a particular amount alloted to a Non-Solicit and Non-Compete)?
If I am going to tithe to my church $8,500 from the sale, is it subtracted from the total amount set to incur capital gains tax (so in my scenario $58,000 + $3,000 - 8,500 = $52,500 to be taxed at capital gains rate).
My itemized personal return (business is set up as an S-corp and this would be *obviously* an asset sale) will be $30,000 or less.