BizSugar.com › Taxes › Small Business and BIG Taxes – Timing is Everything

Owners from the Baby Boom generation are planning their exits, and a privately held C-Corp can be a tax nightmare to sell. Some 80% or more of small business sales are asset sales. When you sell the assets of a C-Corp, it creates ordinary income for the corporation (C-Corps don’t get capital gains treatment). Then when you distribute the balance to yourself or other shareholders, you pay dividend tax.