Strategic Tax
Planning
You Work Hard For Your Money!
Don't just give chunks of it needlessly to the government. Incorporating tax strategies and effectively managing your tax liability is essential for a solid financial plan. Some taxes can be deferred, while others can be mitigated through tax-efficient investment practices. With diligent and ongoing preparation, you can reduce the impact of taxes on your financial goals. The wealthy do it, why not you, it's the same tax code.
Minimize Your Tax Burden
TAX PLANNING is a critical component of any business. As a business owner – you are the most advantaged group in the tax code – take advantage of the vast tax planning opportunities available to you.
Utilize Tax Efficient Investing
Incorporating tax strategies into your financial plan is essential. By deferring certain taxes and utilizing tax-efficient investing, you can effectively manage your tax burden
We Want to Educate You
Our aim, alongside our partners, is to educate our clients in the construction trades on the tax benefits that are available within the tax code that most CPA's or accountants are not aware of.
Consider This Typical Scenario: Sam the Contractor
Sam, a dedicated contractor, has spent decades building a profitable and successful construction business. His journey has been marked by personal and family sacrifices, long hours, sleepless nights, and countless employee challenges. The good news? Sam’s hard work has resulted in a thriving business, a loyal and well-trained team, and a steady stream of satisfied customers.
However, one of the most significant sacrifices Sam may not have realized was his failure to leverage advanced tax planning to transform his business into a powerful tool for building personal wealth and planning for retirement.
Initially, Sam followed the advice of his CPA and established a 401(k) plan. After years of contributions, he encountered setbacks: a withdrawal to help pay for his daughter’s college tuition and a few years where the 401(k) lost value. Ultimately, he found that there wasn’t nearly enough saved to adequately fund his retirement. Sam had hoped to secure his retirement through the sale of his business.
The Good News
After navigating the challenges of finding what he believed was a reputable business broker and a buyer capable of securing financing, Sam successfully sold his construction business for $1,000,000.
The Bad News
Unfortunately, Sam relied heavily on the “business broker” and his CPA for advice on how to structure the sale and draft the purchase agreement. As a result, the amount Sam actually received from the sale—after taxes, buyer-friendly terms, the time value of money, brokerage fees, and additional taxes—was far less than he anticipated. In fact, the final amount deposited into his bank account was closer to $500,000.
The Problem
With only the after-tax proceeds from the sale and his 401(k), Sam faced a harsh reality: the funds available would not sustain him for 30 years of retirement. Sadly, this was all he had to show for his decades of hard work.
The Solution
To avoid such pitfalls, Sam should engage with a team that specializes in proactive advanced tax planning. This team can help him develop, educate, and implement strategies that allow him to extract value from his business to build personal wealth on an annual basis. The more years Sam takes advantage of advanced tax planning, the better positioned he will be. It’s crucial for him to understand the difference between Tax Compliance (simply filing tax returns) and Tax Planning (actively building wealth). The sooner Sam grasps this difference, the more effectively he can secure his financial future.
Shapcott & Lauber is a good place to start