A worked example
An exit, inside the rest of the plan
Priya, 41, married, takes a $180k salary from the C-corp she founded and holds stock with a $20k basis. An acquirer has put $12M of proceeds on the table; she has held the stock four years.
“What does selling actually leave me, and does it change when we could stop working?”
What the projection shows
The sale taxed in the year it happens: the §1202 exclusion at four years of holding versus five, the capital-gains tax stacked on that year's salary, and what the net proceeds do to net worth over the next thirty years. The Financing and exit page works out the proceeds from a cap table. This shows what happens to them once they arrive.
What else the projection found
Nothing was missing from the inputs. These follow directly from the numbers above, under the assumptions this example uses.
- The sale makes $11,980,000 of gain and §1202 excludes $8,985,000 of it, leaving $2,995,000 taxable and $958,184 of tax.
- On the federal return, §1202 excludes $8,985,000 of the $11,980,000 gain. The state doesn't follow it: state tax that year is $1,592,635, compared with $9,193 if there were no sale.
- On the federal return, §1202 excludes $11,980,000 of the $11,980,000 gain. The state doesn't follow it: state tax that year is $1,594,885, compared with $9,449 if there were no sale.
The planner opens with this household already filled in. Change the balances, the ages or the assumptions to match your own situation, then run it.
A projection based on stated assumptions. Not financial or tax advice.