Discussion:Sale of stock in S Corp with installment payments
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| Revision as of 12:56, 30 September 2006 Rkhcpa (Talk | contribs) (New Discussion) ← Previous diff |
Current revision Scot1 (Talk | contribs) (I believe the in) |
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| {{ForumNewPost|UserID=Rkhcpa|Date=30 September 2006|Text=I have a client who is selling his 40% ownership in an S corp. He will receive a downpayment and then installment payments for 3 years. The amount of the sale is to be $200,000. Is the $200,000 that he will receive taxable in the year of the sale of the stock as a capital gain to him or can he claim each years installments separately as a capital gain? Would it benefit him to take a smaller amount for the sale of the stock, say $20,000 and then take the installments as non-compete payments?}} | {{ForumNewPost|UserID=Rkhcpa|Date=30 September 2006|Text=I have a client who is selling his 40% ownership in an S corp. He will receive a downpayment and then installment payments for 3 years. The amount of the sale is to be $200,000. Is the $200,000 that he will receive taxable in the year of the sale of the stock as a capital gain to him or can he claim each years installments separately as a capital gain? Would it benefit him to take a smaller amount for the sale of the stock, say $20,000 and then take the installments as non-compete payments?}} | ||
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| + | {{ForumReplyPost|UserID=Scot1|Date=30 September 2006|Text=I believe the installment method can be used in this instance. I certainly would not suggest you turn a capital gain (sale of capital asset - stock) into ordinary income (non-compete payments).}} | ||
Current revision
Discussion Forum Index --> Tax Questions --> Sale of stock in S Corp with installment payments
| 30 September 2006 | |
| I have a client who is selling his 40% ownership in an S corp. He will receive a downpayment and then installment payments for 3 years. The amount of the sale is to be $200,000. Is the $200,000 that he will receive taxable in the year of the sale of the stock as a capital gain to him or can he claim each years installments separately as a capital gain? Would it benefit him to take a smaller amount for the sale of the stock, say $20,000 and then take the installments as non-compete payments? | |
| 30 September 2006 | |
| I believe the installment method can be used in this instance. I certainly would not suggest you turn a capital gain (sale of capital asset - stock) into ordinary income (non-compete payments). | |
