Building a Path for Owners with Diverging Objectives
Allowing One Owner to Remain While the Other Sells Almost Tax Free
(Strategic Planning) – Two long-time partners found that their personal objectives had changed over the years. One wanted to sell and enjoy his retirement. The other wanted to continue to work with the objective of passing the company down to his daughter. They agreed to split the company with one retaining retail operations and the other, wholesale operations. Janas was engaged to appraise the two halves of the business and adjust ownership in real estate and other assets to make the split even. Janas employed tax counsel to create a tax free reorganization which also allowed significant advantages in the owner’s basis. The selling partner engaged Janas to sell his half, which fetched a price that was more than 20% above market, almost all of which was sheltered by the increased tax basis.