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If you’re a campground owner and you’re thinking of selling your campground within the next five years. You may want to consider looking sooner than later. You’ll want to make sure that you’re prepared well for that sale by having all of your documentation in order. But there’s a key tax strategy that may prompt you to sell sooner than later.
Under our new presidential administration, Biden has said that he would like to remove the capital gains tax that capital gains tax provides a large break in the tax rate to most campground owners who are selling.
Capital gains supplies on the difference in the selling price. After we subtract out the fair market value of the assets that are sold, the sale of the assets are taxed at ordinary income rates while the Goodwill is sold based on capital gains rates. As an investment currently capital gains rates are a maximum of 15% for individuals.
If this tax break were removed, it would be taxed as ordinary income, which under Biden’s plan would be up to 39.6% and possibly more just depending on some other taxes that may accumulate on top of that, that difference between 39.6 and 15% or whatever your rate personally might be, could be a fairly significant number when we talk about the selling price and what you’re able to negotiate. Buyers understand this too. So they want to take advantage of this and get you to sell while you can still get the capital gains. Right?
So if you have questions or you’re considering selling your campground, I’d be happy to talk with you. There’s a lot of planning that goes into selling for the maximum value possible, and I’d love to help you achieve that goal. I’m Donna Bordeaux with CampgroundAccounting.com.
Donna Bordeaux, CPA with Campground Accounting
What happens when you send two CPAs out into the relaxing outdoors to camp? You get CampgroundAccounting.com. Donna and Chad have over 50 years of combined experience as entrepreneurial CPAs. They’ve owned businesses and helped business owners exceed their wildest dreams. They camp and travel across the country every chance they get, so it’s just a natural fit that they focus their CPA skills on helping campground owners throughout the USA grow their businesses and minimize the impact of taxes. They understand the key performance indicators and specialized issues that face RV park owners every day.