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How significant is a tax deferral to a selling shareholder?

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How significant is a tax deferral to a selling shareholder?

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Extremely significant. Sellers should always analyze any proposed transaction alternatives on an after-tax proceeds basis. Although selling a portion of a business to an ESOP may result in a lower selling price than selling to a strategic buyer, the indefinite deferral of capital gains taxes for the selling shareholder usually far outweighs any price difference.

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