Questions

I recently sold a website (which I ran for 3+ years) for a large sum and am looking to minimize my capital gains tax on the sale price. My normal costs (outsourcers/software...etc) were all written off as expenses throughout the time that I ran the site. From what I understand I can't include these as part of my basis since they were already written off as regular expenses throughout the years. I'm trying to understand if I can use my time spent building & promoting the site into my cost basis? I spent a significant amount of my time. I did pay myself from the business checking to my personal checking on a regular basis for normal living costs but this was a sole proprietorship, so not sure if that would be recognized as a proper 'salary expense'. I understand this falls under 'sweat equity' but wondering in what circumstances the owner's time could become part of the basis. I would also be looking for a possible consulting call to touch on additional questions. Thank you!

Your time spent on the business is not deductible and does not add to your basis.


Answered 5 years ago

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