Why This Decision Matters
Sellers preparing for a major liquidity event often know they need tax guidance but aren’t always sure what type of tax attorney to involve. It’s an important distinction. Different tax professionals solve different problems, and the planning required for a business sale is unique.
Compliance vs. Transaction Strategy
Routine tax compliance—filings, reporting, annual strategy—is typically handled by a CPA or general tax advisor. Those relationships remain foundational. But a liquidity event introduces structural questions that go beyond compliance. Sellers face issues involving equity classification, timing of income, capital gains treatment, earnouts, entity restructuring, and how deal terms interact with the tax code.
Qualities to Look For
The right tax attorney for this stage is someone who focuses on the design of the transaction, not just the reporting of it. Key qualities include:
• Experience with exit-focused planning.
• Familiarity with strategies designed to withstand IRS review.
• A collaborative approach with financial advisors, CPAs, and deal counsel.
• Understanding of specialized planning opportunities such as QSBS, installment strategies, and pre-sale restructuring.
• A practical process that provides clear explanations, predictable structure, and efficient implementation.
When Planning Still Works
A liquidity event is one of the rare moments where tax decisions can materially influence a seller’s final economic position. Even when closing is near, meaningful opportunities often remain. What matters is choosing someone who can identify and implement the strategies that fit both the deal and the seller’s goals.
Clarifying Your Needs
If you’re preparing for a sale or exploring your options, clarifying the type of tax expertise you need is one of the most valuable steps you can take. It ensures that the structure supporting your deal is intentional, practical, and aligned with your objectives.
