Tax Moves that Put $ Back in Your Clients’ Pockets – Refs

Do your clients need a new tax accountant?

In the December 2021 issue of “Solutions” we offered several ideas to wrap-up your clients’ 2021 tax situation for maximum advantage.  Looking forward, what can your clients do to best take advantage of tax planning opportunities in 2022?  

TIME FOR A CPA CHANGE?

As 2021 tax returns will be due soon, your clients might be asking for a referral to a quality tax accounting firm.  If so, we’d like to invite you to consider MyCFO! (Click here for 10 questions to ask when interviewing a tax accountant.)

Of primary importance at this time, yes, we do a fantastic job in tax preparation.  But MyCFO does so much more than tax compliance – we are exceptional in tax planning.  This combination is why so many businesses choose MyCFO to prepare their 2021 tax returns.

REAL-LIFE METHODS TO MINIMIZE TAXES

Here are examples of how MyCFO helps our clients as their tax accountant: (click each for extended details)

• Avoiding surprises on quarterly payments: This busy client came to MyCFO needing a better way to project quarterly tax payments. MyCFO set up a system, which we review annually with the client, in which specific percentages of rent and contractor income are set aside on a monthly basis just for taxes.  This system has proven to be accurate within a few percentage points, so that the client doesn’t have to worry about tax payments (read more here).

• Multi-state taxation: In this case, our new client (with online sales comprising 25% of revenues) did not really view themselves as a multi-state business, but the state tax authorities told them otherwise. We helped them out of the current tax situation with minimal fines, then built them an effective an affordable framework for future compliance. 

• Mergers and acquisitions tax planning – Multiple partners, loans, and tax implications: Our client’s ownership was composed of three partners, each with loans to the business of different amounts, and an earnout (i.e., part of purchase price paid in future) to consider. Not only was a calculation of payout/partner necessary but structuring the deal to minimize taxes for the sellers was of paramount importance (read more here).

• Succession planning – Impact on taxation: In Massachusetts, the estate tax applies to estates worth more than $1 million, with the progressive rate toping out at 16%! Recently, our client came to us with several succession planning issues but one of the most important was fairness in distribution of overall assets to different children.  Based on the owner’s directives, MyCFO arranged a business valuation, which helped with proper proportioning of the estate, and helped the business owner to select which non-business assets should be distributed to each child (read more here).

• Structuring for complex business transactions: As a business grows, owners may decide to form a number of related companies. However, tax benefits and structuring are often left as an afterthought, which leads to unintended consequences. In this case, our client’s decades-old family business had expanded through vertical integration.  Part of MyCFO’s solution was to form a holding company. Of course, taxation was considered in the process, as the multi-state aspect of some of the companies impacted their overall profitability.  We also consulted with the client on tax issues related to future buyout options for family members looking to leave the business (read more here).

• Real estate transactions: Cashing out on residential rental and commercial real estate properties seems wonderful until the tax bill arrives. MyCFO helps our clients to use all available avenues to minimize or defer the related capital gains tax, which can vary depending on the situation.  A popular option to delay such taxation is through a 1031 exchange (read more here).

DON’T DELAY – CONTACT US TODAY!

For all of our clients, MyCFO applies our decades of experience in innovative tax planning and preparation.  If this is the kind of innovative thinking and client-focus that your client may need in a tax accountant, please have your client contact us to discuss preparing their 2021 returns.