Client Profile

1. Built the plan while the year of sale was still open. The gain was locked, but the tax year was not. We identified a qualifying, tax-advantaged reinvestment strategy that generated tax benefits large enough to offset nearly the entire gain. Timing was the whole game: the investment had to be identified, vetted, and funded within 2026 to apply against the 2026 gain. There is no equivalent move available once the year closes.

2. Established the client's accredited investor status. The strategy was available only to accredited investors. . The client met this test on net worth, and we handled the accreditation process so the opportunity did not slip away on a technicality.

3. Funded a $250,000 reinvestment before year-end. The client committed $250,000 to the qualifying investment. That reinvestment produced tax benefits that offset almost all of the taxable gain from the business sale, reducing a projected six-figure tax bill to a only a few thousands dollars.

Case Studies - CASE sTUDY 5

The best time to plan for the tax on a business sale is before you sell. The second best time is in the same year of the sale. Once that year closes, most of the meaningful levers are gone. This client is proof that even after a sale has closed, a well-timed strategy executed before year-end can change the outcome dramatically.

The options for managing a large capital gain range from straightforward tools such as tax-loss harvesting to advanced strategies including Qualified Opportunity Funds, charitable structures, and energy investments. Some of these require accredited investor status, which we can help qualifying clients establish subject to the applicable requirements. The right approach depends entirely on the size and character of the gain, the client's broader financial picture, and how much time is left on the clock. If you are approaching a sale, or have already sold this year, the window to act may still be open.

Have another question? Email us at info@crescentcpaadvisors.com

How a Louisiana Business Seller Eliminated Over $200,000 in Capital Gains Tax in the Year of the Sale

Louisiana business owner who sold their company in 2026, realizing a long-term capital gain of more than $1,000,000. The sale left the client facing a projected federal and state capital gains tax bill of over $200,000.

Selling a business is often the largest single taxable event of an owner's life. Years of built-up value convert to cash in one transaction, and the gain lands in a single tax year. For a sale of this size, the combined federal long-term capital gains rate of up to 20 percent, the additional 3.8 percent net investment income tax, and Louisiana state income tax can consume a substantial share of the proceeds.

This client came to us having already closed the sale. The gain exceeded $1,000,000, and the projected tax exceeded $200,000, due in full with the 2026 return. Nothing about the transaction itself could be undone. The only question left was whether anything could still be done inside the same tax year to reduce the liability before it became final.

That is the constraint most sellers do not appreciate until it is too late.

The Problem

What We Did

The Result

Why This Matters

• Projected 2026 capital gains tax of over $200,000 reduced to nearly zero

• A $250,000 reinvestment offset almost the entire gain on a business sale exceeding $1,000,000

• The tax benefit was captured in the year of the sale, before the liability became final

This case study reflects an actual client engagement with identifying details removed for privacy. Individual results vary based on each taxpayer's specific facts and circumstances, including material participation, property type, and income composition. This content is for informational purposes and does not constitute individualized tax advice.