Taxes are an inescapable part of selling your veterinary practice, and they can be an intimidating or confusing part as well. Speaking to a tax specialist can help you understand the best course for your veterinary business. Here are some points to consider as you prepare.
The Value of Your Veterinary Business
Some taxes are based on the value of different assets of your business, such as equipment, inventory, restrictive covenant, and goodwill. These assets can be taxed at different rates and in different ways. Goodwill, for example, is often taxed at the rate of capital gains.
Consider the amount of inventory on shelf at your practice. Many sales limit the amount of inventory a buyer will purchase, leaving you responsible for the remainder. Selling off excess inventory now means more money in your pocket and impacts the amount you owe in taxes.
Understand Status of Real Estate
There are some factors to consider involving the status of the real estate on which your veterinary business is located. If you own the property, you have the option to sell it as part of selling the business. You’ll be responsible to pay the appropriate capital gains taxes on the sale. You may also opt to wait and sell the property later for a variety of reasons, whether the buyer isn’t interested, the market is depressed, or other factors make selling now unwise.
Plan a Strategy
The first thing to do as you consider selling your veterinary business is to be sure you have an accurate, up-to-date valuation of your practice on hand to help you map the decisions that most benefit you. Meeting with a tax specialist will also help you minimize your tax burden. It also helps you plan appropriately for the taxes you’ll owe as part of the sale of your business. Contact Practice Sales Advisors today. Let our team of specialists help you craft a plan to make the most of the years you’ve invested in your veterinary business.
Practice Sales Advisors | Your Trusted Veterinary Broker.
hello@psavet.com | 912-268-2701
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