Tax Expert Offers Free Download Of Book To High-End Financial Advisors
Surprise Practice Buyouts Catch Advisors Off Guard
Tax strategies use IRS private letter rulings as the basis for planning.
Recent reports indicate that it is a seller’s market when it comes to fee-based financial advisory practices. Historically, depending on a range of factors, average pricing valued firms at 2.5 times revenues. However, recent reports point to valuations at or above 2.8 times revenues.
Buyers seem to be scrambling to aggregate practices. As a result, financial advisors are seeing unexpected buy-out offers. In the past, advisors would forego an “out-of-the-blue” offer. But, some recognize that they might not see current practice valuations at some future point in time. As such, they are accepting such deals; these “out-of-the-blue” offers are seen as “out-of-the-park” offers.
The challenge with an unexpected offer is that most business owners – including financial advisors – have not had the opportunity to put tax plans in place. According to Forbes Magazine Online columnist Todd C. Ganos: “With little to no time to plan, many financial advisors might believe there is nothing that can be done. In fact, there is much that can be done to reduce the tax burden on the sale of a financial advisory practice…even with little notice.”
Among other topics, Ganos’ column focuses on tax strategies employed by middle market business owners in the sale of their companies. He notes: “Depending on specific circumstances, an advisor might reduce the ultimate income tax on their gain by 30 to 75 percent. As for advisors who are still not ready to sell, there are incentives to put such planning structures in place early. The structures used to plan for an ultimate sale can actually help reduce tax on ongoing net income prior to the that sale.”
To help financial advisors understand the tax terrain of selling their practices, Ganos is offering a free download of his Kindle book “The 3 Tax Secrets You Need To Know About Selling Your Business” on Amazon on Christmas Eve and Christmas Day. At www.RIAtaxSavings.com, he also offers a complimentary web-based private consultation to financial advisors whose practice has $2 million or more in annual revenues.
- Contact Information
- Stuart McFaul
- Spiral Group
- (1) (415) 869-8579
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