Legal Blog

M&A Nugget: Happy “Tax Cuts and Jobs Act” Holidays

The Tax Cuts and Jobs Act (the “Act”) contains provisions which should make buyers and sellers of businesses happy. The increased immediate deduction for the purchase of equipment and computer software, reported in a prior M & A Nugget when the change was pending, was included in the final Act, although at a lesser increase than was contained in the proposed law. The Act doubles the deductible amount from $500,000 to $1,000,000.00. The current $2,000,000.00 phase out trigger was increased to $2,500,000.00. Sellers (and therefore buyers) will benefit from lower tax rates on a sale of business. C corporations will benefit because of the substantial decline in the corporate tax rate to 21%. Sellers of S corporations will also benefit in two ways. The individual tax rates have been lowered. In addition, pass through entities, like S corporations and limited liability companies, get a new deduction equal to 20% of taxable income. This means less income passing through to the owners, and therefore less tax. Happy Holidays to all.



If you have any questions about this or any other M&A issue,
please contact Glenn Solomon at or 443-738-1522.


ABOUT GLENN D. SOLOMON | 443-738-1522

Glenn D. Solomon is a principal at Offit Kurman and has provided counsel to businesses and business owners for more than twenty-five years. He has extensive experience in the purchase and sale of businesses, structuring ownership agreements, and advising companies in financial distress.








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