When it comes time to sell a business, many owners are shocked to realize how much of their hard-earned value will go to taxes. In the video below, Kelly Finnell, President of Executive Financial Services, shares a story of a business owner whose company was valued at $10 million. After using EFS’s tax calculator, the owner discovered he had paid $6.8 million in taxes over his career—and was facing at least another $2.8 million in taxes if he sold the business. The realization that his lifetime tax burden nearly equaled the value of his company was eye-opening.
Fortunately, there’s a powerful alternative. Selling to an Employee Stock Ownership Plan (ESOP) can dramatically reduce—if not eliminate—these taxes. In fact, using an ESOP structure, the same business owner could have saved an estimated $9.38 million in taxes over 10 years. That’s not a loophole—it’s a long-standing provision of the U.S. tax code, supported by both Republicans and Democrats. Thousands of companies across the country, including household names like Publix Supermarkets, have already taken advantage of these benefits.
An ESOP lets you do more than minimize taxes—it allows you to maximize sale value while preserving your legacy. You protect your employees, culture, and community, all while keeping more of what you’ve built. If you’ve assumed your only option is to sell to private equity or a competitor and write a massive check to the IRS, think again. Use our ESOP tax calculator and explore how this strategy might transform your exit plan—for the better.
Drew Bringhurst
Vice President of Client Engagement
dbringhurst@execfin.com
www.execfin.com
901.496.0930
