Many business owners have the same question: what to do with money from sale of business? Selling a business can be complicated, but it’s important to understand the financial implications of the sale. In this article, we will break down three common options for using the money you receive from the sale of a business.

What Should You Do With The Money After Selling Your Company?

The first thing to consider after selling your business is to take stock of your financial goals and timeline. Are you planning to retire or reinvest in a new venture? Knowing your financial goals and timeline can help you decide how best to use the proceeds from the sale of your business.

After taking stock of your financial goals, the next step is to create a formal plan for how you will use the money. This plan should consider both short-term and long-term goals and include a strategy for diversifying your holdings. Diversifying your holdings is important because it allows you to spread risks and maximize your profits.

Where To Invest Capital Gains After Selling A Business – Tax-deferral Options

One option for investing capital gains after selling a business is to invest in qualified opportunity zone funds. These funds are designed to encourage investments in low-income and distressed communities by providing tax-deferral options. Investing in these funds can help you get the most out of your capital gains.

Another option for investing capital gains after selling a business is to put the money into non-qualified investment accounts. This could include individual checking or savings accounts, joint tenant bank accounts, stocks, bonds, mutual funds, or other investments. Depending on your individual financial goals, you may want to consider putting some of the money into investments with higher risk and higher potential reward.

Paying Taxes On The Sale Of A Business

When selling a business, it’s important to remember that the proceeds are considered income and must be taxed accordingly. You’ll need to pay taxes on the amount you receive, so it’s important to have a plan for how to use the money that’s mindful of the potential tax implications.

It’s also important to note that there may be other tax considerations depending on the type of business you sold. For example, if you sold a business that was held in an LLC, you may need to pay taxes on the capital gain.

No matter what type of business you sold, it’s important to consult a qualified accountant or tax advisor to ensure you understand the tax implications of the sale.

Maximizing Your Profits From The Sale

When selling a business, it’s important to make sure you maximize the profits from the sale. This includes considering the tax implications, diversifying your holdings, and creating a formal plan for how you will use the proceeds. It’s also important to take stock of your financial goals and timeline and consider investing in qualified opportunity zone funds or non-qualified investment accounts.

If you have questions about selling a business, the experts at are here to help. They are dedicated to providing you with the best advice and resources for selling your business.

What are the legal ways to avoid paying taxes when I sell my business?

Negotiate carefully when selling your business to minimize the amount of capital gains tax you owe. Consider an installment sale, pay attention to the timing, sell to employees and research Opportunity Zone reinvestment to potentially avoid paying capital gains.

What should be done with the funds acquired after selling a business?

Here are some options to make the most of the transaction: structure it in a way that is beneficial, look into capital gains treatment, offset losses with other investments, invest in tax-free options, think of giving to charities, evaluate the possibility of giving gifts, maximize contributions to retirement plans such as an IRA, and prepay state and/or local taxes.

What happens to the money when a business is sold?

What is the procedure for postponing capital gains when selling a business?

If a business owner sells their business and obtains a capital gain, they can opt to defer the tax on that gain by investing the money into a Qualified Opportunity Zone Fund within 180 days of the sale.