Selling the Family Business to Your Children Without Handing the IRS a Second Payday
An IRS Section 453 installment sale spreads the gain across your retirement, while $19,000 annual gifts and 20-40% valuation discounts move value tax-free.
#capital-gains
Capital Gains
Track and report capital gains from investments
Rollover Equity When You Sell Your Business: Section 721 Deferral, the Second Bite, and Minority Protections
Section 721 defers tax on the ~20% sellers roll into a PE buyout — but junior securities, leverage, and weak minority rights can erase the second bite.
The Backyard Cottage P&L: What an ADU Really Costs, Earns, and Does to Your Taxes
ADU rental income goes on IRS Schedule E: split shared costs by square footage, depreciate the unit over 27.5 years, and plan for 25% recapture tax at sale.
Canada's Capital Gains Inclusion Rate Is Still One-Half: Selling a Business or Rental in 2026
Canada cancelled the two-thirds capital gains inclusion rate on March 21, 2025, but kept the $1.25M lifetime exemption — roughly $1,275,000 indexed for 2026. Here are the QSBC tests, CCA recapture, and 45(2)/45(3) elections that decide your bill.
Domain Flipping and the IRS: Are You an Investor or a Dealer?
On a $25,000 domain sale, investor treatment costs roughly $3,750 while dealer treatment can exceed $9,000 — how Section 1221, the nine-factor hobby test, and per-name basis records decide which you are.
You Own the Land but Not the Minerals: How Lease Bonuses, Royalties, and Depletion Are Taxed
Oil and gas lease bonuses, delay rentals, and royalties are all ordinary income reported on Schedule E — but royalties qualify for 15% percentage depletion that can continue after your basis hits zero. How each payment is taxed, where it goes on your return, and the state traps to avoid.
Selling a Business-Owned Life Insurance Policy: How a Life Settlement Is Taxed
A life settlement payout splits into three slices — basis tax-free, gain up to cash surrender value as ordinary income, the rest as capital gain. Here is how a business reports it, plus Forms 1099-LS, 1099-SB, 8925 and Section 101(j).
RSUs Explained for Startup Employees: Why Vesting, Not Selling, Is the Tax Event
RSUs are taxed as ordinary income on the vesting date, not at sale, and employers withhold a flat 22% on supplemental wages up to $1 million — leaving employees in the 32–37% brackets short by 10 to 15 percentage points each April. This guide covers double-trigger vesting at private startups, why no 83(b) election exists for RSUs, and the $0 cost-basis error on Form 1099-B that makes people pay tax twice on the same income.
Stock Sale vs. Asset Sale: A Small Business Seller's Guide to the Tax and Liability Trade-Offs
In a stock sale the seller reports one capital gain and the buyer inherits every liability; in an asset sale the price is allocated across seven Form 8594 classes, so depreciation recapture, inventory, and C corporation double taxation convert much of the gain to ordinary income. Here is how each structure taxes the seller, what the 338(h)(10) election and personal-goodwill carve-out change, and which liabilities follow you past closing.
Section 1234A and Termination Payments: Why a Forfeited Deposit or Canceled Purchase Option Gets Capital, Not Ordinary, Treatment
Section 1234A treats gain or loss from the cancellation, lapse, or termination of a right in capital-asset property as capital — so a forfeited earnest-money deposit is usually a short-term capital loss, a lapsed option premium is short-term capital gain, and a merger break fee is a capital loss capped at $3,000 of ordinary income per year for individuals. Services contracts, Section 1231 business property, and debt retirements fall outside the statute and stay ordinary.
House Hacking Taxes: How to Split Your Duplex Between Schedule E and Home (and Keep the Section 121 Exclusion When You Sell)
A house hack is two tax properties under one roof — a Schedule E rental and a Schedule A home. Split shared costs by a documented percentage, depreciate only the rental half over 27.5 years, use up to $25,000 of rental losses against wages below $100,000 MAGI, and expect unrecaptured Section 1250 gain at up to 25% on prior depreciation when you sell.
Your QSBS Win Is Federal-Only in California: What Founders Owe the State on a 'Tax-Free' Exit
California does not conform to Section 1202, so a QSBS gain that is 100% excluded federally is taxed in full at state rates up to 13.3% — a $4 million exit can leave a founder owing roughly $350,000–$450,000 to Sacramento. This guide covers the 2025 QSBS expansion's new three- and four-year tiers, why California repealed its own exclusion, the real math on graduated brackets and the 1% surcharge, and what an FTB residency audit demands from founders who move before selling.