Exit Tax Strategy Roadmap
FAQs
Without planning, taxes can consume 28%–37% of your $10M exit. Federal, state, and NIIT all apply — making proactive tax strategy essential.
QSBS allows you to exclude up to $10M of capital gains if the business meets C-corp and holding period requirements.
A combination of QSBS, charitable trusts, installment sales, and trust-based estate strategies — customized to your personal and business structure.
3–5 years before your expected exit. Most tax-efficient tools require long setup timelines and must be executed before an LOI.
Fusion combines tax, estate, and investment strategy into one plan — helping high-income founders keep more of their exit wealth.
You scaled your business to $10M. But how much do you actually keep?
Too many founders focus on the top-line exit number — not the bottom-line wealth impact. Without advanced tax planning, you risk giving up millions to federal and state taxes.
At Fusion Wealth Management, we’ve helped high-income entrepreneurs structure exits to reduce tax drag, protect legacy, and maximize net proceeds.
Why Taxes Are the Silent Killer of Business Exits
In a $10M exit, the IRS is often your biggest “silent partner.”
Standard tax liabilities can include:
- Federal capital gains: 20%
- NIIT (Net Investment Income Tax): 3.8%
- State taxes (AZ/CA/NY): 5%–13%
Combined: 28%–37% of your exit proceeds could evaporate.
"Every dollar not taxed is a dollar that builds your legacy." — Dustin Giannangelo
The Pre-Exit Tax Playbook
To reduce that burden, start years in advance. Fusion Wealth Management deploys layered strategies including:
- Qualified Small Business Stock (QSBS)
- Potentially exclude up to $10M in capital gains
- Must be C-corp stock held for 5+ years
- Charitable Remainder Trusts (CRTs)
- Defer capital gains
- Receive lifetime income
- Support legacy philanthropy
- Installment Sales
- Spread income over multiple years
- Keep you below higher marginal brackets
- Opportunity Zones
- Reinvest gains to defer or eliminate taxes
- Intentionally Defective Grantor Trusts (IDGTs)
- Transfer appreciating business assets pre-sale
- Freeze estate value while shifting growth to heirs
Timeline of a $10M Exit — Tax-Optimized Version
Year -3 to -2:
- Entity review (C-corp vs. S-corp)
- QSBS qualification analysis
Year -2 to -1:
- CRT or gifting strategy setup
- Advisory team alignment (CPA, estate, legal, wealth advisor)
Year 0 (LOI):
- Deal structure (stock vs. asset sale)
- Installment provisions
- Tax-advantaged liquidity planning
Post-Sale:
- Reinvestment strategy
- Tax-loss harvesting
- Ongoing trust and family governance
Common Pitfalls That Cost Founders Millions
- Too late for QSBS qualification
- Lump-sum cash receipt triggers higher brackets
- Advisors not aligned = disjointed tax strategy
- Failing to integrate estate and investment planning
Fusion’s Exit Tax Model — Built for Precision
We don’t guess. We calculate.
Fusion simulates different scenarios based on:
- State-specific tax rates
- Charitable and trust structures
- Family wealth flow goals
The result? An exit plan that keeps more of your $10M in your family’s future.
Learn more: Fusion Wealth Management
Disclaimer: The information provided in this blog is intended for informational purposes only and should not be construed as financial, tax, or legal advice. We recommend consulting with a qualified financial advisor or tax professional to discuss your specific financial circumstances and retirement planning needs.