Showing posts from January, 2018

How does the new tax law benefit business buyers?

To answer that question I went on a search though the googlesphere to see what I could find.

Please remember I'm not an accountant nor have I actually read the tax law, I just searched for news articles about the law. 

So far I came up with three things:

Tax rates are lower.
If you are a buyer, that means that the profit the company has to make in order to provide you with the after tax return you need is lower. That means you should able pay less the get the income you want from a company. Definitely a big winConverting to C Corp is 'cheaper'.
Its pretty obscure, but you can spread out certain tax liabilities due to accounting changes over 6 rather than 4 years, and certain previous income can taxed as a pass through longer. Since sometimes buyers need to convert to a C corp for financing purposes, this may benefit them. Simplified Accounting.
Business under $25 million in average revenue can use simplified accounting methods. Before, the limit was $5 million in average re…