Why You Should Get a Tax Advisor Involved

by | Sep 8, 2023 | PKF Texas - The Entrepreneur's Playbook®, Insight-Post

So, you know that you need a tax advisor to help with your business transaction. What’s the next step? Getting that tax advisor involved. Why should you do this? Find out from Tax Director, Chris Dodd, CPA, and Tax Senior Manager, Thang Ngo, CPA, in this episode of PKF Texas – The Entrepreneur’s Playbook®.

Jen: This is the PKF Texas – Entrepreneur’s Playbook®. I’m Jen Lemanski, and I’m back once again with Chris Dodd and Thang Ngo, two of our Approachable Advisors™ on our tax team. Welcome to the Playbook, y’all.

Chris and Thang: Thank you. Great to be here, Jen.

The Experience

Jen: So, the last time you were here, we talked a little bit about when we should get a tax team involved in a buy- or sell-side agreement. Why should we get the tax team involved?

Chris: I think it’s all about experience. Just a quick anecdote. I was a first-time home buyer once, and I bought my house. I thought everything was good. All of a sudden, the dishwasher went out; didn’t know what to do. Call the home warranty guys, guy comes out, walks in, very nonchalant says, “Start the dishwasher.” I start, it makes that little grumbling noise, and, all of a sudden, it started working and he said, “Yep, that’s what I thought it was.” That’ll be $150 for my trip.

And it was just… it was a simple thing. He already knew the problem. I told him the model; he knew it right when he walked in the door. So that’s where the experience comes in. We’ve seen certain transactions – we’ve seen when things go really right, when things go really wrong, different scenarios. And so, that’s when you approach your advisor, and that’s why you approach your advisors to say, “You know what, I’m going through this process. I just need help.”

Identifying Potential Pitfalls

Thang: Yeah, totally agree with Chris. As your tax advisor, we’re here to help you look for potential pitfalls so to help you to focus on your business.

Jen: And so, are there different models that you guys use when you’re… when somebody comes to you with a sale or a purchase?

Thang: We do. We do have potential modeling out of tax transaction, ensure that they are what you intend to be. We also help you with all the pre due diligence tax before, even before the sell-side comes in and do their due diligence that would help identify any potential risk that you overlook that you’re not familiar with. So, we’re here to help you with that area.

Chris: Well, you know, as Thang said when he was talking about potential pitfalls, usually kind of the (LOI) or the first offer, that’s usually the ceiling. And so, what we’re trying to do is just make sure that on the sell side if there’s anything out there we can help you with the process and guide the buyer through, “Hey, this is what the seller is doing.” Give them the strategy so that they get more comfortable with the business.

Jen: Perfect. Awesome. Well, we’ll get you guys back to share a little bit more about how tax team members can help you with the transaction. Sound good?

Chris and Thang: Thank you.

Jen: This has been another Thought Leader production, brought to you by PKF Texas – the Entrepreneur’s Playbook®. For more information about this and other topics, visit our website at PKFTexas.com. Tune in next week for another chapter.

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