Pest Management Professional, December 2013

EXIT STRATEGIES Continued from page 24 and therefore impractical for a seller who needs or wants to sell within the next few years THE SALE OF PERSONAL GOODWILL Sellers faced with unacceptable alternatives have devised a creative way to minimize the impact of the corporate level tax by separating personal goodwill of the sellers owners from the business goodwill of the corporation itself Selling a shareholders personal goodwill is tax efficient because it provides the buyer with the tax benefits he seeks while the selling shareholder only pays the lower personal capital gains tax on the personal goodwill sold thereby avoiding the dreaded double tax for that portion of the sale The two seminal cases that approved this approach were Martin Ice Cream Co v Commissioner 110 TC 189 1998 and Norwalk v Commissioner 76 TCM 208 1998 In the Martin Ice Cream case a father and son disagreed about an ice cream distribution business that was owned by a C corporation with them as shareholders To settle the dispute the father and son caused the C corporation to transfer a division of the operation PCO Bookkeepers strengthens M A capabilities J ohn P Corrigan and Norm Cooper have both joined PCO Bookkeepers a business advisory and accounting firm founded by Daniel S Gordon CPA as business succession specialists Corrigan oversees the firms merger and acquisition M A and family succession planning practice As an M A specialist hes known for his ability to negotiate and structure buy side and sell side transactions in addition to working with private business owners about internal matters including generational transfers and trust and estate planning strategies Corrigan brings extensive experience in all forms of business contracts including executive compensation plans long term incentive awards employment and severance agreements deferred compensation structures and mergers and acquisitions transactions including all types of reorganizations recapitalizations and refinancing In addition to his role at PCO hell continue as a member of New York law firm Corrigan and Baker LLC Previously he was a founding member of The Sellers have devised a creative way to minimize the impact of the corporate level tax by separating personal goodwill of owners from buisness goodwill of the corporation Continued on page 30 Breakwater Group a boutique consulting firm that provided business financial and tax planning advice to private companies and their owners Before his tenure at Breakwater Corrigan was VP corporate secretary and tax counsel of a publicly held investment and insurance holding company as well as a senior tax manager at Deloitte and Touche LLP His peers have recognized him as a Super Lawyer in the New York metro area as well given him a rating of superb on national lawyer service www avvo com Cooper a PMP Hall of Famer and a past president of the National Pest Management Association has consulted on more than 50 pest management M A acquisitions during the past several years frequently being referred to as the dealmaker He brings extensive knowledge of pest control company enterprise value and generational transfer issues as well as solid relationships with pest management professionals private equity groups and others through the country who are in the M A arena Hes also a frequent contributor to Pest Management Professional magazine Gordon Corrigan Cooper 28 December 2013 Pest Management Professional www mypmp net