For business owners
Business Sales
Defer the tax on the sale of your company — and turn the proceeds into income.
The problem
A business sale can be taxed from several directions at once
When you sell a company you have built, the gain can be exposed to federal long-term capital gains tax, the 3.8% Net Investment Income Tax, and state income tax. If the deal is structured as an asset sale, portions of the gain can also face depreciation recapture at higher ordinary rates.
Recognizing the entire gain in the year of the sale can take a meaningful share of your life's work off the table at once. The 537 Installment Sale Trust offers a different path — recognizing the gain gradually, as you are paid.
The solution
How the 537 IST defers the gain
The 537 Installment Sale Trust applies the installment method under IRC Section 453. You sell the business — or its appreciated assets — to an irrevocable trust in exchange for a secured installment note. The trust then completes the sale to your buyer and reinvests the proceeds, paying you over time.
Because an independent trustee holds and reinvests the proceeds, you avoid constructive receipt, and gain is recognized as payments are received rather than all at once. Read the Legal Memorandum →
What a business owner gains
Defer capital gains tax under the installment method (IRC §453)
Spread recognition over the payment period instead of one taxable year
Convert sale proceeds into a structured passive income stream
No like-kind reinvestment and no 45/180-day deadlines
Works for an entity sale or an asset sale of business property
Independent fiduciary trustee — funds are not constructively received
Coordinates with estate planning and wealth transfer
Grounded in IRC §453 and IRS Publication 537
How it works
Property or
Business SaleEscrow &
Closing537 Installment
Sale TrustInstallment
Payments to You
Consultation
We review your entity, deal structure, basis, and goals to confirm a 537 IST fits your sale.
Trust Formation
An irrevocable trust is established with an independent trustee ahead of your closing.
Installment Sale
You sell the business or its assets to the trust in exchange for a secured installment note.
Buyer Closing
The trust completes the sale to your buyer at fair market value.
Reinvestment
Proceeds are reinvested by the trustee into a diversified portfolio aligned to your goals.
Income Stream
You receive installment payments over time, deferring gain recognition across the term.
See the deferral on your sale
Model your business sale and compare an outright sale against a 537 IST, side by side.