As CPA firms try to reimagine their businesses by offering services that extend beyond traditional tax returns and assurance work, the combined effects of an ongoing labor shortage and a lack of expertise can often hold them back.
That’s why Engineered Advisory (EA), an offshoot of Engineered Tax Services, is connecting CPA firm members in its Engineered Advisory Accelerator program to a vetted selection of partner companies, helping them run their businesses more efficiently while expanding services to clients.
While no single firm can offer every service, and some specialized tax services are appropriate for only a handful of clients, CPA professionals were able to get referral sources and learn from the experts at EA’s second HABU (Highest and Best Use) conference earlier this month in Plano, Texas, which attracted 51 CPA firms and 57 strategic partners.
Here are some possible new services for CPA firms to consider, courtesy of this year’s HABU experts:
IC-DISCs (Interest Charge Domestic International Sales Corporations) – An IC-DISC is a separate, tax-exempt legal entity that benefits exporters of U.S.-produced goods. David Spray, president of Export Advisors, says that if a CPA firm has 200 corporate clients, only two would likely benefit from the tax break, “so it doesn’t make sense to have a whole practice built to serve two clients.” Some tax professionals don’t even know what IC-DISC is, and they likely don’t want to become experts, Spray says, but they occasionally want to refer their clients to someone who is.
Aviation Tax Advantages – Private aircraft owners can take advantage of generous tax benefits, but navigating the complex rules takes help. “To some degree, business aviation is the Wild West. It’s an industry that is not transparent. It’s exceptionally complicated,” says Quinn Ricker, CEO of Jet Access. “Supply chain issues have really developed into a major issue for a lot of the aircraft out there, so bringing together a group of people like Engineered Advisory has – who know all the pieces of the market and what is happening in the industry – is so important, especially in a time like this, when it’s very dynamic and frankly the industry is more complicated than ever.”
R&D Tax Credits – R&D credits, while well-known, can apply to a wide range of companies that are continually working to improve – manufacturers, tool and die shops, software developers, injection molding companies and even golf course owners. “They experiment with irrigation, drainage and turf, to name a few,” says Geoff Kimmel, client development director with Engineered Tax Services. “Those things are all within the normal course of them being a good golf owner-operator. They’re earning the credit anyway, why not take it for crying out loud?” That said, getting the credit from the IRS is convoluted, so it takes an expert to help clients pick the right projects and get it right. “You want to be popular with your clients? Give them the R&D tax credit. Don’t leave any dollars on the table for your clients.”
Commercial Real Estate – Warren Kirshenbaum, founder of Cherrytree Group LLC, is dedicated to offsetting taxes for commercial real estate investors, especially through environmental remediation, renewable energy and rehabs of historic buildings. “The ideal client would be one who has a capital event or someone that has a large tax bill, and the source of their income is passive – that’s when these tax credits work best.” It’s a “small universe” of clients, Kirshenbaum adds.
Solar Energy – Josh Cordle, founder of Sun Farmer’s Group, aims to make renewable solar energy financially sensible and more easily attainable. Under the old business models, he says, environmentally friendly investments were out of reach unless you could write a big check. “We created the tools to make it possible for virtually anybody to be a part of the change, and it’s actually financially beneficial for anyone that does it. Saving the world is just a bonus.”
To learn more about Engineered Advisory and the Engineered Advisory Accelerator program, schedule a call.
