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Small Business · Exit Planning

Business Sale Tax
Impact Modeler

The headline price is not what you keep. This models the federal tax on a business sale across the pieces that actually drive the number: how the price is allocated between assets, how much of it is depreciation recapture taxed as ordinary income, whether the stock qualifies under section 1202, and what an installment structure does to the timing.

Data: 2026 (LTCG brackets Rev. Proc. 2025-32; NIIT §1411; QSBS per OBBBA)

Inputs STEP 1
Sale structure
Asset sales split the price across asset classes with different rates.
Price and basis
Total consideration before costs.
Reduces amount realized.
Stock basis for a stock sale, aggregate asset basis for an asset sale.
Asset allocation, asset sale only
Drives section 1245 recapture.
Drives unrecaptured section 1250 gain at 25 percent.
Taxed as ordinary income.
Ordinary income to the seller.
Capital gain. Set to 0 to auto-calculate as the remainder.
Other income and state
Wages, interest, other business income.
Set to 0 for a no-income-tax state.
Applied to recapture, inventory, and non-compete proceeds.
QSBS, section 1202, stock sale only
Tiered exclusion applies to stock acquired after July 4, 2025.
2026 OBBBA cap, inflation indexed.
Installment sale
This is an illustrative estimate, not tax advice. Treatment depends on your full facts and on current IRS guidance, which can change. Consult a CPA or tax attorney.
Allocations exceeded the amount realized, so all allocated amounts were scaled down proportionally to fit.
Estimated Net Proceeds After Tax
--
Amount realized minus total estimated tax
Total Estimated Tax
--
--
Installment Savings
--
Versus a lump-sum sale, same allocation
Detail
Amount realized--
Ordinary income component--
Section 1245 recapture--
Unrecaptured section 1250 gain--
Capital gain component--
Federal ordinary tax--
Federal capital gains tax--
Section 1250 tax at 25 percent--
Net investment income tax--
State tax--
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