The sale of a lifetime,
seen clearly.
For owners of an established, privately held business weighing a sale. What the road ahead looks like, how deals are structured, the tax elections that move real money, and how to plan for the life that comes after. Explore the tools below, then decide alongside your CPA, attorney, and M&A advisor.
Reviewed by Peter Tennyson, CFP® · Last updated October 2026
This guide is general education, not advice. Confirm everything with your CPA, attorney, and M&A advisor before you act. Full disclosures
Where things are headed.
Selling a privately held business is usually a nine-to-twelve-month process once you go to market - and preparation often starts twelve to eighteen months before that. Step through the stages to see what each one asks of you.
One seat at the table - alongside your deal team.
Your M&A advisor or investment banker runs the sale. Your CPA leads on the tax return, and your attorney drafts the documents. Our role sits around all of it: helping you weigh readiness and timing, modeling what different structures mean for the life you want afterward, coordinating pre-sale gifting and charitable moves with your tax and legal team, and preparing to invest the proceeds the day they arrive.
We implement and align - we don’t replace your CPA, attorney, or banker. If a sale is on the horizon, even a few years out, that is when this conversation is most valuable.
The day after you sign.
For most of your working life, your business was your portfolio - and your identity. After the sale, a large, concentrated, illiquid asset becomes cash that has to be invested, spent, and given away thoughtfully. That is a different discipline, and the transition can be as emotional as it is financial.
The planning that matters most often happens before the deal closes: pre-sale gifting while the value is still “low,” charitable timing, and a clear picture of what the proceeds need to do for the rest of your life. Done early, these choices are far more powerful - and far harder to fix once the wire has landed.
Replacing an owner’s salary and distributions with a sustainable draw from a diversified portfolio.
Family gifting, trusts, and charitable vehicles - often most valuable when set up ahead of the sale.
What comes next - a next act, an earnout role, or simply time - and how the money supports it.
Value is a range, set by a multiple.
Many privately held businesses are valued by applying a multiple to adjusted EBITDA - earnings adjusted for one-time and owner-specific items. The multiple can vary widely with the company's industry, size, growth, recurring revenue, customer concentration, management team, market conditions, and deal terms. This framework is for general education, not an appraisal or estimate of any particular business's sale price.
Valuation methods and multiples vary considerably across businesses and transactions. Smaller owner-operated companies are sometimes valued using seller’s discretionary earnings rather than EBITDA. Industry conditions, buyer interest, financial quality, and the terms of a deal all matter. A company-specific valuation or buyer process is more informative than a general rule of thumb; a quality-of-earnings review may help support the financial inputs.
Asset sale, stock sale, or a hybrid.
How the deal is structured often matters as much to your take-home as the price. Buyers usually prefer to buy assets; sellers usually prefer to sell stock. Switch between them - and the common middle ground - to see the trade-offs.
Your entity type drives much of this. C-corporation owners face the risk of two layers of tax in an asset sale; S-corporation, LLC, and partnership owners generally see pass-through treatment. The right structure - and elections like 338(h)(10) or 336(e) - should be modeled with your CPA and attorney well before a letter of intent.
The elections that move real money.
A handful of structural choices - most of them decided years before a sale - can change your after-tax outcome dramatically. Here are the ones worth understanding. Explore each, then pressure-test which apply to you with your CPA and attorney.
These are general approaches for education, not recommendations, and several have strict eligibility rules and filing deadlines. Whether any applies - and how - depends on your entity, your state, and your complete picture. QSBS rules in particular changed under 2025 federal legislation and many states (including California) do not conform. Review anything here with your CPA and attorney before acting.
The terms, in plain language.
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Thinking about a sale?
Whether it’s next year or five years out, the earliest conversations create the most options. Let’s map what a sale could look like for you - alongside your CPA and attorney.
Educational use only. North Bay Wealth Management does not prepare tax returns or provide legal or business-brokerage services; tax-related planning is coordinated with your CPA, who leads on filing, and your attorney and M&A advisor lead on legal and transaction matters. The explanations, tools, ranges, and any figures or estimates on this page are simplified illustrations for general education and may not reflect current law, your state’s rules, your entity type, or your complete situation. Valuation discussion is general education, not an appraisal. Federal tax rules referenced here - including the Qualified Small Business Stock provisions of Internal Revenue Code Section 1202 - changed under 2025 legislation and continue to depend on acquisition dates, holding periods, entity qualification, and state conformity. Nothing here is a forecast, an offer, or a recommendation to sell any business or security or to use any structure or election, and it should not be relied upon to make decisions. Actual results will differ. Consult qualified professionals before acting. Investing involves risk, including the possible loss of principal.