The business entity may be taxed, and the shareholders or owners may too. If the business is a partnership (general or limited) the sale could be made by the partnership (a sale of assets). The tax basis is the company's purchase price for the assets, less accumulated depreciation, plus certain adjustments. Sometimes this kind of basis is called “inside” basis, meaning the tax basis inside the entity. Depending on the type of business entity, this gain may be taxed to the entity or to its owners.

Source: Forbes February 11, 2019 13:41 UTC