Brad Strickland

Restructuring an LLC to qualify for Qualified Small Business Stock (QSBS) benefits can be complex, but with careful planning, you could be looking at substantial tax advantages. We teamed up with Hanson Bridgett LLP to guide you through. Quick refresher on QSBS ⤵️ QSBS is a federal tax incentive allowing founders, early employees, and investors to potentially exclude up to $10 million in gains (or 10x their basis) from taxable income when selling shares in qualified C-corporations, if held for five years. Considering a conversion from LLC to C-corp? Here’s what you need to know ✍️ ⚡ Many businesses start as LLCs, but converting to a C-corp is often necessary for QSBS eligibility. 🧑‍⚖️ In the recent Leto v. United States case, the court ruled that restructuring missteps disqualified Michael Leto's shares from qualifying as QSBS, as the exchange of S-corporation "stock" for C-corporation stock did not meet the "original issuance" requirement. This case shows the importance of preserving QSBS eligibility during business restructuring to ensure you don’t lose out on these significant tax benefits. Here are critical steps to consider: 1️⃣ Timing is crucial: To meet QSBS requirements, plan to hold shares for five years following conversion to benefit fully from the tax exclusion. Early conversions, before significant value appreciation, can maximize tax advantages. 2️⃣ Navigating Section 1202 requirements: The IRS imposes specific requirements for QSBS status. Your C-corp must meet certain thresholds for gross assets and operational activity. Ineligible businesses include those in finance, consulting, and other professional services. 3️⃣ Capital gains impact: Conversion can mean significant tax savings if your business achieves substantial growth. Consulting with tax advisors will help navigate conversion complexities, avoid potential pitfalls, and ensure compliance with QSBS requirements. For LLC owners considering this transition, preparation is key. With Carta, you can simplify and track QSBS eligibility documentation. Read our full post for the details: https://lnkd.in/gFgC_DeD #LLC #SCorp #QSBS #LLCConversion #TaxStrategy

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Are Avalara mistakes costing your business? On October 23rd, Stephen Bradshaw, CPA, BT Partner in Charge of Bennett Thrasher’s State and Local Tax (SALT) Practice, will reveal the most common (and costly) Avalara issues that can impact your bottom line—and how to avoid them. Register for free now: https://hubs.la/Q02Rvl3D0

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IMPORTANT UPDATE: By way of background, Dodd-Frank Act Section 1473(q) amended Title XI of the Financial Institutions Reform, Recovery, and Enforcement Act of 1989 (FIRREA) by adding a new section, Section 1125, which relates to quality control standards for automated valuation models (AVMs) used in valuing real estate collateral that secures mortgage loans. Read more here: https://lnkd.in/gnbceYyT 𝘈𝘥𝘷𝘦𝘳𝘵𝘪𝘴𝘦𝘮𝘦𝘯𝘵. 𝘛𝘩𝘪𝘴 𝘪𝘯𝘧𝘰𝘳𝘮𝘢𝘵𝘪𝘰𝘯 𝘪𝘴 𝘯𝘰𝘵, 𝘯𝘰𝘳 𝘪𝘴 𝘪𝘵 𝘪𝘯𝘵𝘦𝘯𝘥𝘦𝘥 𝘵𝘰 𝘣𝘦, 𝘭𝘦𝘨𝘢𝘭 𝘢𝘥𝘷𝘪𝘤𝘦. 𝘠𝘰𝘶 𝘴𝘩𝘰𝘶𝘭𝘥 𝘤𝘰𝘯𝘴𝘶𝘭𝘵 𝘢𝘯 𝘢𝘵𝘵𝘰𝘳𝘯𝘦𝘺 𝘧𝘰𝘳 𝘢𝘥𝘷𝘪𝘤𝘦 𝘳𝘦𝘨𝘢𝘳𝘥𝘪𝘯𝘨 𝘺𝘰𝘶𝘳 𝘪𝘯𝘥𝘪𝘷𝘪𝘥𝘶𝘢𝘭 𝘴𝘪𝘵𝘶𝘢𝘵𝘪𝘰𝘯.

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Recently had the opportunity to speak at ASE Private Wealth in Greenville, SC about the game-changing potential of tax planning for privately-held businesses. Imagine reducing your federal income tax by nearly half and using that cash to grow or protect your business. 📽️ Watch my presentation below to learn how Guardian Tax Consultants can help businesses and advisor firms achieve remarkable financial results. #BusinessGrowth #TaxStrategy #WealthManagement #GuardianTax

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The IRS's Economic Substance Doctrine is reshaping tax compliance, focusing on transactions' real economic impact over technicalities. Beware of 'basis-shifting' in partnerships - they're closely monitored. At DBC tax & business advisors, we specialize in navigating these complexities to ensure compliance and peace of mind. Check out this quick guide to understand this new IRS focus - https://lnkd.in/epYqFPgY Let's navigate this together! #TaxCompliance #IRSrules #BusinessAdvisors #EconomicSubstance #TaxPlanning #TaxProtocol

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Did you know the new beneficial ownership reporting could take you less than 20 minutes? ⬇️ For companies with simple ownership structures, submitting beneficial ownership information to FinCEN is faster than you think. Make sure your business is ready for these new federal reporting requirements. Stay on top of it today: https://www.fincen.gov/boi

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ICYMI: The Internal Revenue Service recently wrapped up its 2024 “Dirty Dozen” campaign by warning taxpayers about promoters selling bogus tax strategies and fraudulent offshore schemes designed to reduce or avoid taxes. In particular, the #IRS warned taxpayers about potential #tax schemes involving syndicated conservation easements, micro-captive insurance arrangements, Malta Pension plans, and digital assets. https://lnkd.in/eqKSkS4X #taxlaw #taxcontroversy #cryptocurrency

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Inspiring to see well over $12M forfeited from the fraudster’s assets and recovered by the government in this complex PPP loan case!! From 2018 to 2021, Keilholz received $12.4M from 4 total PPP loans to cover up for payments due in his businesses. In each of his PPP applications, Keilholz made multiple materially false claims and did not disclose his ownership in his 3 other failing businesses. According to the article: “Keilholz must forfeit to the government any property involved in, or derived from the proceeds of his bank fraud scheme, including a money judgment of $12,430,932, two properties in Jefferson City, one property in Valparaiso, one property in La Porte, Ind., four vehicles (a 2020 Chevrolet Silverado, two 2021 Chevrolet Silverados, and a 2019 BMW X5), two Gents stainless steel Rolex Sea-Dweller self-winding automatic diver’s watches, and a Gents Citizen Eco-Drive Radio-controlled world time self-winding automatic watch with sapphire crystal.” To maximize recoveries in cases where government funds are wrongly used for personal items such as houses, watches, cars, etc., it is crucial to quickly track the inflows and outflows of every bank account associated. With multiple fake entities, business accounts, personal accounts and a variety of assets to trace back to the fraudulent PPP loans in this case, identifying every transfer, wire, and bank account can be extremely challenging and time consuming. And as time adds up, it often becomes less and less likely that the fraudsters' assets can be seized and recovered. Traditionally, recognizing all transfers and assets across dozens of accounts and entities can take days to weeks of investigator time alone!!

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Do you qualify as a "reporting company" under FinCEN, or are gearing up for the January 1st compliance deadline? Register now for our virtual event, FinCEN Filing: What Small Business Owners Must Do, to prepare! During the event, you'll learn about the new Beneficial Ownership Information (BOI) reporting requirements that may affect your business. Click here to learn more: https://lnkd.in/eE9g_mRU #upcomingevent #businesseducationseries #chamberevent #chambermembers #localbusinesscommunity

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SECURE YOUR SPACE By: John W. Willingham, CCIM, CBI, CBB, FIBBA Many Business owners operate out of leased space and this can prove to be problematic if not handled properly. There are many issues that could be explored and every business situation is a little different. In this Article, I want to discuss the situation where the Business owner has allowed the original lease to expire and is occupying the space on a month-to-month basis. Many business owners like occupying their space this way and they feel that this gives them more freedom to move to a different location or close their business with no obligation to the current landlord. On the other hand, the landlord is also free to find a better tenant that is willing to pay more rent or sell the property to an owner/user. When we bring your business to the market, a potential buyer could go around you to the landlord, sign a lease and have you evicted. That doesn’t happen very often. However, what does happen often is the landlord wants to increase the rent and that decreases the value of your business to a potential buyer causing the buyer to lose interest in your business or renegotiate the price to reflect the higher rent. Sunbelt Business Brokers and Advisors makes the following recommendations to Business Owners: 1. Secure your space with a long-term lease, that will protect you and a new buyer of your business. Note: We offer Tenant Representation services. 2. Tell your landlord you are thinking of selling before you bring your business to market and confirm that he/she will cooperate with you through the process. My experience has taught me that landlords don’t like finding out that one of their tenants has sold their business, pending landlord approval. When this happens, the landlord will be more difficult to deal with and that may cause transaction failure. 3. When you contact your landlord, ask them to keep it confidential. Most landlords will honor your request and appreciate your trust in them. If you do these things the sales process will go much smoother and result in a quicker sale.

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In case you missed it, the IRS announced three weeks ago a major tax relief for those affected by Hurricane Helene. If you're in Alabama, Georgia, North Carolina, South Carolina, or parts of Florida, Tennessee, or Virginia, you now have until May 1, 2025, to: 🔹 File your 2024 individual and business returns 🔹 Submit 2023 returns with valid extensions 🔹 Make quarterly estimated tax payments Important note: This relief is automatic if your address is in the affected area. If you've recently moved to these regions, you may need to contact the IRS directly at 866-562-5227. Plus, those with uninsured losses from the hurricane can choose whether to claim them on their 2023 or 2024 returns—giving you flexibility when you need it most. #TaxRelief #HurricaneHelene #IRSUpdate #TaxDeadlines Source: https://lnkd.in/gShP_gWY

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Financing small to mid-size C&I projects is challenging due to the high transaction costs of tax equity structures. These projects can't afford partnership flips or inverted leases and are often excluded by banks' size and credit standards. Sale leasebacks offer a simpler alternative, but the issue persists: there is a supply-demand mismatch for tax-advantaged capital. Read more to understand how Energetic simplifies the process and expands access to tax-advantaged capital for these smaller projects to thrive.

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