What are Net Proceeds?

Net proceeds is the amount of funds received from a sale transaction, after all sale-related fees have been paid. Examples of these fees are closing costs, commissions , and credit card fees.  These fees do not include the cost of the asset that was sold.

Types of Net Proceeds

Here are several examples of the net proceeds concept:

Net Proceeds from Asset Sales

• Real Estate Sale Proceeds: Amount received after deducting closing costs, realtor commissions, legal fees, and taxes.

• Vehicle Sale Proceeds: Amount received after dealer fees, loan payoffs, and title transfer costs.

• Business Sale Proceeds: Net amount after brokerage fees, legal costs, and settlement of business debts.

Net Proceeds from Securities Transactions

• Stock Sale Proceeds: Gross sale minus broker commissions and transaction fees.

• Bond Redemption Proceeds: Net of redemption fees or early withdrawal penalties.

• Mutual Fund Sale Proceeds: Net of exit loads, management fees, and other fund-related charges.

Net Proceeds from Financing Activities

• Loan Proceeds: Disbursed loan amount after subtracting origination fees, underwriting costs, and service charges.

• Bond Issuance Proceeds: Amount received after underwriting discounts, legal fees, and registration costs.

Net Proceeds from E-Commerce or Retail Sales

• Online Sales Proceeds: Gross revenue minus platform fees (e.g., Amazon, eBay), payment processor fees (e.g., PayPal), and shipping costs.

• Credit Card Sales Proceeds: Revenue after deducting merchant service fees and chargeback reserves.

Each type represents the actual cash inflow to the seller or issuer, providing a clearer picture of realized gains or usable capital.