Net Proceeds. Simplified.
Provide your sellers with the clarity they need to confidently move forward.
Our Seller's Net Proceeds Calculator empowers brokers to provide sellers with a clear and concise breakdown of their potential earnings from a business sale. By inputting key sale details and anticipated expenses, this tool instantly calculates the estimated net proceeds, allowing brokers to:
Provide transparent and accurate financial projections.
Address seller concerns and manage expectations.
Build trust and facilitate smoother negotiations.
Clearly show all fees, taxes and other expenses.
This user-friendly calculator is an essential resource for helping sellers understand their financial outcome and make informed decisions.
Seller's Net Proceeds Calculator
Estimate how much you'll walk away with after selling your business
Sale Details
Tax Information
Cost Basis
Calculated Results
Important Notes:
- This calculator provides estimates only and is not tax advice.
- Consult with your accountant or tax professional for precise figures.
- Tax situations vary widely based on business structure and specifics.
© 2025 Atlantic Coast Business Advisors - This calculator is for estimation purposes only
How to Use the Seller's Net Proceeds Calculator
A Guide for Business Brokers
The Seller's Net Proceeds Calculator helps you show business owners exactly what they'll walk away with after the sale of their business. This valuable tool accounts for all costs associated with the transaction, including debt payoff, brokerage fees, closing costs, and taxes.
When to Use This Calculator
During initial seller consultations to set realistic expectations
When reviewing offers with clients
For "what-if" scenarios when sellers are considering different sale prices
To help sellers understand the impact of their business's cost basis on net proceeds
Field-by-Field Guide
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Business Sale Price: Enter the potential or agreed sale price (gross amount)
Total Debt Payoff: Include all business debt that will be paid at closing (loans, lines of credit, equipment leases, etc.)
Brokerage Commission: Enter your firm's commission percentage (typically 8-12%)
Closing Costs & Fees: Include legal fees, escrow fees, transfer taxes, etc. (typically 1-3% of sale price)
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Federal Capital Gains Rate: Default is 20% for long-term gains, but advise clients this may vary based on their:
Income bracket
Business entity type
Length of ownership (short vs. long term)
State Tax Rate: Enter the applicable state tax rate for capital gains (0-13% depending on state)
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Original Acquisition Price: What the seller paid when purchasing or starting the business
Where to find it: Purchase agreements, closing statements, formation documents, initial capital contribution records
For startups: Include initial investment, business formation costs, startup expenses
If records are incomplete: Work with client's accountant to reconstruct through bank statements, loan documents, or tax returns
Capital Improvements: Any significant investments that improved the asset value (not regular expenses)
Where to find it: Capital expenditure records, depreciation schedules, fixed asset lists, equipment purchase receipts
Examples include: Building renovations, major equipment upgrades, business expansions, new technology systems
Documentation needed: Invoices, contracts, canceled checks, loan documents for improvements
Note: Only include items not previously expensed on tax returns
Selling Expenses: Professional fees, appraisals, and other costs directly related to the sale
Where to find it: Current invoices from attorneys, accountants, appraisers, business brokers (if separate from commission)
Qualifying expenses: Legal fees for transaction documents, accounting costs for financial due diligence, valuation services
Advise clients to: Keep detailed records of all transaction-related expenses as they occur
Best Practices
Always Qualify Results: Emphasize this is an estimate and they should consult with their tax professional
Document Your Inputs: Save a screenshot or print the results for your client's records
Compare Scenarios: Show how different price points affect the bottom line
Highlight Cost Basis Impact: Demonstrate how documenting improvements can reduce tax liability
Review with Accountant: Encourage clients to share these projections with their accountant
Explaining Results to Clients
When reviewing calculator results:
Start with the gross sale price and walk through each deduction
Emphasize that capital gains tax only applies to the gain (sale price minus cost basis)
Point out that debt payoff doesn't increase tax liability since it's not part of the gain
Explain that a higher cost basis means lower capital gains taxes
Value Proposition
By using this calculator effectively, you demonstrate your professionalism and thoroughness, while helping clients set realistic expectations. This builds trust and reduces the likelihood of sellers backing out late in the process due to tax surprises.
Remember: Clients truly appreciate understanding what they'll actually take home after the sale, not just the headline sale price.
FAQs
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This provides a solid estimate, but your tax professional should review for your specific situation. The calculator doesn't account for potential recapture of depreciation, alternative minimum tax, or other complex tax situations.
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Closing costs are paid at closing and include transaction fees, while selling expenses include preparations you've made to sell the business such as legal fees, accounting fees, and appraisal costs.
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Capital gains taxes apply to the difference between what you paid for the business and what you're selling it for. Let's look at ways to document your full cost basis to minimize your tax liability.
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No, it varies based on your income bracket, length of ownership, and business structure. For high-income sellers, the rate can be 20% plus a 3.8% net investment income tax. For lower-income brackets, it might be 15% or even 0%.
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Any depreciation you've taken on business assets may be subject to 'depreciation recapture' at a 25% rate rather than the lower capital gains rate. This calculator provides a simplified view, so your actual tax situation may differ.
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Some states like Florida, Texas, and Nevada have no state income tax, while California can be as high as 13.3%. We're using your state's rate of [X%], but your tax professional can provide state-specific advice.
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The calculator works for both, but tax implications differ significantly. In an asset sale, gains are typically taxed at different rates for different asset classes. In a stock sale, everything is usually taxed at the capital gains rate.
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With seller financing or earnouts, you may be able to spread tax liability over several years under the installment sale method. This calculator assumes a cash-at-closing scenario.
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The calculator works best for pass-through entities like LLCs and S-Corps where business gains pass directly to your personal return. For C-Corps, there could be double taxation issues not reflected here.
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The calculator still applies, but remember that if you've taken a below-market salary over the years, the IRS might recharacterize some of your gain as ordinary income rather than capital gains.
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Several strategies exist, including identifying all legitimate business expenses that contribute to your cost basis, considering an installment sale, exploring a 1031 exchange for real estate components, or potentially setting up a charitable remainder trust. These advanced strategies require professional advice.
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Timing can matter if you anticipate significant changes in your income between years. Selling in a lower-income year might put you in a lower tax bracket for capital gains purposes.