More Than Answers: Digging Deeper to Build Meaningful Tax Strategies

by: Nicole Davis
Verified by: CPA

March 16, 2023

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When assessing accounting and advisory firms, business leaders often focus on the tangible benefits offered by potential partners. These are, of course, important: your accounting firm must be competent, sophisticated, and able to deftly handle complex financial situations.

However, it’s vital you also consider the more intangible factors. As a business leader, you need a partner you can trust—one that prioritizes client relationships. The right firm is responsive when you call with a question: they don’t ignore your emails or take days to pick up the phone. They anticipate your needs, learn the nuances of your business, and work tirelessly to help you make better financial decisions. 

At Smith + Howard, our commitment to delivering a world-class client experience is a core pillar of our firm’s values. Our role is to serve as trusted advisors that go the extra mile to deliver meaningful benefits to the businesses we work with—from manufacturers to leading nonprofits in the arts and culture space.  

Today, we’re exploring exactly how our team embodies these values in every client engagement. We do this by partnering with our clients and taking a deep dive into their financial situation to explore scenarios that build meaningful tax strategies.

Smith + Howard’s Client Service Philosophy

It’s our goal to bring a responsive, practical approach to every client engagement. We focus on building long-term relationships forged by a proven track record of delivering unrivaled value for our clients. 

We encourage our team to immerse themselves in our client’s businesses to uncover real opportunity. What does that look like in practice? Here are several scenarios where we find we’re able to add significant incremental value beyond the scope of a traditional engagement. 

Answering Questions and Digging Deeper

You should never hesitate to pick up the phone and call your accounting firm with a question about a business issue. At Smith + Howard, you’ll find our team to be immediately responsive and eager to assist. But beyond answering your call and giving you a straight answer to your question, what additional value can the right firm provide?

Consider this example: you’re considering offering equity to an employee as part of their compensation package. You call your accounting firm to ask how to best do this. At first glance, this sounds fairly straightforward. If an accountant were to take your question at face value, they would advise you on how to set up employee stock ownership plans. But immediately diving into the execution can often be erroneous. At Smith + Howard, we take a different approach, helping our clients explore the wider financial questions that an issue presents. 

In this scenario, taking the time to explore the second-order impacts of awarding employees equity yields some complex issues. As an equity partner, the employee may have to sign on your business’s line of credit. Depending on your business, they may have to file tax returns in dozens of states. These are just a couple of examples: the potential ramifications are endless.  

What seemed like a simple decision to reward an employee’s performance can quickly become a tax and compliance nightmare. That’s why it’s crucial to work with a firm such as Smith + Howard that probes beyond your initial question to explore how you can best fulfill your business needs. 

In this scenario, it’s possible to find a solution that’s agreeable to all parties. One option would be to grant employees ‘phantom stock’ instead of equity. These employee benefit plans offer many of the benefits of equity ownership with minimal legal and financial obligations. 

Piecing Together the Puzzle Pieces

During every engagement and client conversation, our tax professionals are constantly on the lookout for new opportunities to deliver value. We pay attention to every conversation and identify interesting clues that could foreshadow an opportunity to optimize tax strategy.

The U.S. Tax Code is incredibly complex. As a time-strapped business leader, it’s easy to make decisions without fully understanding the tax implications. But as your accounting firm, it’s our role to brief you on opportunities, contextualize them in your wider tax and business strategy, and help you take advantage of them. 

Let’s say that during the course of an advisory engagement we hear the CFO of a manufacturing business mention they recently acquired new machinery to set up an additional production line. 

Though they didn’t originally realize it, the business may be eligible to take advantage of a tax credit or incentive. There is also the question of depreciation: should these new assets be depreciated on a standard schedule across their useful life span or does it make more sense for the business to pursue an accelerated depreciation schedule? Leveraging both of these strategies could have favorable tax implications. 

The Smith + Howard team prides itself on identifying these subtle cues and understanding how they fit with your overall strategy. This underscores the importance of building a partnership with a firm that understands the intricacies of your business—something everyone at Smith + Howard is deeply committed to. 

More Than Tax Preparation: A Strategic Partner

When our tax practice works on business tax and private client tax engagements, we view our role as far more than just a tax filer—we’re tax planners. As your tax accountants, we review your tax documentation to identify opportunities to optimize your tax strategy. 

As our team prepares your business tax returns, we may notice that payroll expenses have increased significantly over the prior year. Intrigued by the possibilities, we seek further information. 

If the payroll increase is attributable to hiring new employees, your business may be eligible for tax credits including the federal Work Opportunity Tax Credit and state tax credits such as jobs and retraining credits. Taking these credits enables businesses to significantly minimize its tax burden while growing headcount. 

Smith + Howard’s commitment to identifying and exploring the opportunities that exist within a business’s tax documentation is frequently a major value driver for our clients. This proactive approach ensures businesses minimize their tax burden while remaining in compliance with all federal, state, and local tax regulations.  

Smith + Howard: A Client-First Accounting Firm

It’s our mission to constantly discover new opportunities for our clients to streamline their businesses. Throughout every engagement, our team actively looks for opportunities to save our clients money and deliver demonstrable financial value. 

With experienced, hands-on partners, our advisors know the questions to ask to get to deeper financial insights. It’s our goal to help business leaders evaluate decisions through a strategic lens and thoroughly investigate every option before making a decision. This often includes exploring the succession and estate planning goals of the business owners to ensure that the entirety of the tax issues are addressed. 

We place deep value on building relationships with our clients. To that end, our team focuses on being as responsive as possible. It’s our policy to respond to questions in 24 hours or less—a commitment that’s deeply appreciated by clients as they navigate complex financial issues. 

Do you need guidance evaluating a major business decision or exploring the tax implications of your business strategy? Our team is here to assist you: contact an advisor today.

How can we help?

If you have any questions and would like to connect with a team member please call 404-874-6244 or contact an advisor below.