Every Season Is Tax Season In A Business Exit Strategy

Tax season may be behind you, but if you’re preparing for a strategic exit, tax planning shouldn’t pause.

It often needs to continue for months or even years before a transition takes place. The biggest challenge owners face isn’t complexity, it’s simply getting started. Procrastination often results in avoidable tax bills and missed opportunities that can materially affect long-term wealth.

It’s never too early to think about long-range tax exposure in an exit scenario. Exit planning moves slowly. If you intend to sell your business in August, it’s common for essential tax steps to begin in January and finalize in May, with broader entity and trust structuring often taking years. This timeline becomes even more important when owners focus heavily on valuation. Growth creates opportunity, but it also creates higher tax burdens. A business generating $2 million a year can face taxes approaching $800,000 annually — right when you should be optimizing cash flow. Thoughtful tax planning can often cut this significantly, giving you more capital to reinvest or secure your future.

Tax strategy is the other half of a strong exit plan. You want a valuable business going into the transaction, but you also want to protect the wealth you’ve built. Tax planning continues after the sale as well, guided by a candid understanding of your spending, goals, and lifestyle. Without disciplined post-exit planning, it’s easy to erode deal structures and trigger unnecessary capital gains.

Choosing the right navigator

Another common pitfall is relying on professionals who aren’t equipped to design comprehensive exit tax strategies. Not all financial advisors model the same scenarios or understand the full scope of tools available. A CPA may focus on estate tax projections, but ignore future income needs. A planner may manage cash flow well, but overlook entity optimization or trust structures. And philanthropy — one of the most powerful levers in reducing tax exposure — is often completely absent from traditional planning conversations.

I believe you cannot create the strongest possible exit strategy without incorporating structured charitable planning. Philanthropy reduces tax exposure, enhances long-term impact, and brings intention to a plan in a way that encourages owners to stay committed to it.

Tax planning isn’t a box you check once. It is a cornerstone of your exit strategy and demands a year-round view. If you’re unsure whether your current plan is optimized — or if you aren’t sure where to begin — we’re here to help you navigate the next step.