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How do I invest proceeds from the sale of my business with…

Customer Question
How do I invest...

How do I invest proceeds from the sale of my business with pre taxed money?

Accountant's Assistant: The Accountant will know how to help. Please tell me more, so we can help you best.

I am 69 years old and I am selling my 17 year old business with about $80,000 net profit. I am still working on a part time basis and will make about $45,000 per year.

Accountant's Assistant: Is there anything else the Accountant should be aware of?

I am married to a 55 year old and we owe about 10 years on our home.

Submitted: 7 months ago.Category: Tax
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Answered in 6 minutes by:
12/22/2017
Tax Professional: Lane, JD, CFP, MBA, CRPS replied 7 months ago
Lane
Lane, JD, CFP, MBA, CRPS
Category: Tax
Satisfied Customers: 14,894
Experience: Law Degree, specialization in Tax Law and Corporate Law, CFP and MBA, Providing Financial & Tax advice since 1986
Verified

Hi. My Lane’s Lane …

I hold a law degree (J.D.), with concentration in Tax Law, Estate law & Corporate law, an MBA in finance, a BBA, and CFP & CRPS (Chartered Retirement Plans Specialist) designations, as well - I’ve been providing financial, Social Security/Medicare, estate, corporate, non-profit, and tax advice to clients on three continents since 1986.

If you’ll please bear with me for a minute I’ll type up my initial response, and then we can go from there if you have further questions on this.

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Tax Professional: Lane, JD, CFP, MBA, CRPS replied 7 months ago

There are really only two things that can be done under today's tax code.

...

(1) a §1031 exchange, where you roll the proceeds into a new business, or

...

(2) Do an installment sale, so that you only have to pay the gain as it's received.

...

The installment method of reporting taxes was enacted by Congress so that taxpayers can pay taxes on the sale or other disposition of property over time, when the payments from an installment sale are actually received.

...

The payment received each year are partially a return of your investment (basis), partially gain, and small amount if interest. The return of your investment portion of the payment is not taxable

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