• Kathy Svetina

Advanced Tax Strategies For A Growing Business

From: "Help! My Business is Growing" Podcast


Advanced Tax Strategies For A Growing Business


Taxes can be seen as a necessary evil for many founders and business owners. They are a significant financial obligation and one you can't afford to get wrong or mess up to protect your growing business. However, it is also possible to make taxes work for you with advanced tax strategies and find opportunities to get more tax deductions and tax savings.


In today's episode, our guest, Ronica Brown, a tax planning expert & CPA, shares how you can dig into the tax code and come up with methods that work for your business to save on your taxes.


She breaks down the process step by step on how you can implement advanced tax strategies designed to provide maximum tax reduction and wealth creation in the form of savings.


In this week's episode, we discuss:

  • 02:10 How is a CPA specializing in advanced tax strategies different from regular CPAs that business owners are used to working with?

  • 04:24 How would you find a CPA that provides advanced tax strategies and who can support the current stage your growing company is in?

  • 07:18 What is the process of determining how to maximize tax credits based on a company's financial statements such as a P&L and balance sheet?

  • 19:02 How can business owners find strategic partnerships that give them tax advantages?

  • 27:10 What can business owners and founders do today that will take them closer to having a sound tax strategy in place?




Transcript


Listen to the podcast here:




 
If you're working with someone (a CPA/tax adviser), and they're not bringing new ideas to the table, that's when you know that your business may have outgrown your current tax advisor. - Ronica Brown, CPA
 


How is a CPA specializing in advanced tax strategies different from regular CPAs that business owners are used to working with?



CPAs that specialize in advanced tax strategies are equipped with a deeper knowledge of taxes. They also have extensive experience as a tax practitioner and they:

  • Understand the tax law

  • Understand how to USE the tax law

  • Understand how to APPLY it to the individual needs of businesses.



Tax preparation is a necessary evil that you have to do. But tax planning is where you're able to get more substance. As your business grows, that's where you're able to save money and increase cash flow. And that's pretty much where you get to basically grow your wealth after taxes.



How would you find a CPA that provides advanced tax strategies and who can support the current stage your growing company is in?



You can start by looking on LinkedIn. You'll know where they currently work and their track record/experience in taxation within their current position/industry and beyond.


Some tips in vetting possible candidates:

  • Look for someone with a corporate background.

  • They will bring that wealth of knowledge and experience into the small business arena that you can benefit from.


  • Go through their posts & comments.

  • Are they authorities on the subject?

  • How are they engaging with their audience?


  • Reach out and ask pertinent questions to check if they can provide your needs:

  • Where have you worked and what was your experience like?

  • What are you focusing on in your business right now?

  • What type of tax planning and strategies are you familiar with?



What is the process of determining how to maximize tax credits based on a company's financial statements such as P&L and balance sheet?


1. You need to be financially ready - meaning all your reports and data are updated.


If the financials are not in good condition, your strategic tax planning will have to wait until they get fixed. Just as it’s true for the rest of the business - you cannot make good decisions using bad data.



2. Look at the last two to three years of tax returns to look for "low hanging fruits."

  • Identify the most accessible opportunities to get some more tax deductions and tax savings

  • Find the following and correct them:

  • Common missed deductions

  • Incorrect reporting of certain deductions


3. What can you change in terms of your reporting?

  • Is it time to change your entity structure?

  • Have you labeled everything correctly?

  • How would that maximize your deductions?



Like in the solar business example, how can business owners find strategic partnerships that will give them tax advantages?


More often than not, a tax planning savvy CPA who is up to speed with any in the tax code will let you know:

  • How to take advantage of a tax credit

  • What industries or tax products are available to help someone reduce taxes.


This is why it's crucial to find a CPA with a solid tax background and a finger on the financial pulse of the industry.

  • They can bring new ideas to the table and many other tax advantage options.


You probably know more about your tax return than your accountant just because they are your finances and you're the one spending the money. So as a taxpayer, you actually know more, but I think are just afraid of the process.



What can business owners and founders do today that will take them closer to having a sound tax strategy in place?


  • Start now. Don't wait until tax season.

Schedule an appointment with your tax planning service provider.


  • Take charge of your taxes. Stop being afraid of them.


  • Vet potential tax planning professionals that can help you with your tax strategy.


  • Have them do a virtual walkthrough of your tax return to see their process and how they work.

  • Ask questions regarding what is/isn't deductible, even if you think they might not make sense.

  • Find out what other ideas they might have to help reduce your taxes.



We go in-depth with this topic and more over at the podcast. Listen here:


 

To Recap:


1. A CPA specializing in advanced tax strategies can do more than just regular tax preparation. They will have a deeper understanding of tax laws and know how to help business owners save money. They will also have new ideas and advice, custom-fitted for your growing business and not just generic solutions.


2. LinkedIn is a great resource to find tax-savvy CPAs.


It's a public resume where you can quickly reach out to - and vet - potential candidates.


3. To find out how you can maximize your tax credits:

  • Ensure that your "financial housekeeping" is in good condition and that all your reports are correct.

  • Aim for the low-hanging fruits first, those strategies that you can implement quickly.

  • Expand your analysis by looking at what else can be done creatively to get more tax savings.


4. Your CPA should be able to help you find strategic partnerships and tax products that can give you a tax advantage, especially if they keep abreast of any new developments within the taxation and accounting sphere.


5. A tangible first step you can do immediately to get closer to implementing advanced tax strategies into your growing business is to take charge of your taxes and not be afraid. Find someone who can help you and start now - even if it's just to inquire and ask questions.



 

About Ronica Brown, CPA

Ronica Brown is a tax planning expert and certified public accountant (CPA) with over 12 years of tax planning and tax preparation experience.


She is also the owner of RBA Tax Advisors. By focusing on strategic tax planning, she and her team work with organizations of various sizes ranging from SMEs to large corporations, helping them rethink their tax strategies and reduce their tax bills by 30% or more. These tax savings have empowered them to grow their businesses, invest, and develop exit strategies.


However, tax planning isn't the only aspect of Ronica's life. She's a wife and mother who is passionate about gardening and cooking. In fact, she has a wide variety of plants in her backyard.


Website: https://rbataxadvisors.com/

LinkedIn: https://www.linkedin.com/in/ronicabrowncpataxandacounting

Ronica's Youtube Channel: https://youtube.com/channel/UCapjVwFkaQhyvyWQBu3s8CQ


 

by Kathy Svetina

Kathy is a Fractional CFO and the founder and director of NewCastle Finance LLC. She is a financial puzzle solver, focusing on women-owned businesses, providing financial insights needed for a healthy and sustainable business.