Morgan Stanley has issued a warning for business owners about selling their businesses, stating that the biggest financial risk is not the sale itself or the negotiations. The firm argues that what you do with the windfall after closing will define your financial trajectory for decades. Seven in 10 business owners depend on their sale proceeds to fund their post-exit lifestyle, according to a study by the Exit Planning Institute. Morgan Stanley’s wealth management division has identified five critical areas that every business seller must address before and after closing. The federal government treats the profit from your business sale as a capital gain, which can be significant for sellers. If you held your ownership stake for more than one year, you qualify for long-term treatment and lower federal tax rates. High-income sellers also face an additional 3.8% Net Investment Income Tax once income thresholds are exceeded. The $19,000 gift tax exclusion can be used to split gifts with spouses without tax consequences.