Succession Planning

According to the AICPA, only 46 percent of multi-owner firms and 6 percent of sole practitioners have written a succession plan. 

A succession plan for your business means a better financial proposition and reduced emotional stress for you, your partners, and your family. The following insights will help you prepare.

Pennsylvania CPA Journal

  • IRC 355: Understanding the Basics of a Tax-Free Spin-off

    One disadvantage of forming a Subchapter C corporation is the unfortunate reality of “double taxation.” The first level of taxation occurs when the business pays corporate income taxes on its profits. The second level occurs when the previously taxed profits are distributed to shareholders as dividends. Even if the corporation does not have sufficient cash flow and decides to distribute property that has appreciated in value to its shareholders, the tax is typically unavoidable.
  • Building a Core Competency in Mergers and Acquisitions

    At many middle-market companies, mergers and acquisitions (M&A) are few and far between. But if your company’s strategy includes growth by acquisition, M&A needs to be a core competency. Fortunately, this does not require staffing a large internal transaction group.
  • Check M&A Agreements before Taking CARES Act Benefits

    When the Coronavirus Aid, Relief, and Economic Security (CARES) Act was signed into law, taxpayer-friendly opportunities were aimed at quickly getting cash into the hands of businesses who needed it most. One method of accomplishing this included the temporary reintroduction of net operating loss (NOL) carrybacks. While this was certainly a welcomed benefit, some taxpayers who were involved in a merger or acquisition in 2018, 2019, or 2020 may need to review their old agreements to make sure the benefits of their NOLs are preserved.
  • In an M&A Deal, Buyers Often Have a Succession Plan Too

    There is one part of the M&A equation that is important to note: succession is not unique to one side of the table. Buyers, too, have succession issues that impact their approach to M&A. Here are four general succession concerns that often guide buyer-side decisions.
  • Section 382(h) Proposed Regs Throw Taxpayers a Curveball

    On Sept. 9, 2019, the U.S. Treasury and IRS issued proposed regulations under IRC Section 382(h) pertaining to the interaction between built-in gains or losses with Section 382 limitations. Treasury believes the proposed regulations will simplify the application of Section 382, provide needed clarification to taxpayers in determining built-in gains and losses, and address other issues relating to Section 382 that were created as a result of tax reform (the Tax Cuts and Jobs Act of 2017). Taxpayers are not as optimistic about these recent developments, and for good reason.

CPA Now Blog

  • COVID-19 Stifles Middle Market Private Equity Dealmaking

    Middle market private equity deals and fundraising activity slowed through the second quarter of 2020 as the pandemic continued to ravage businesses. And there is a troubling sign of what may be an ongoing M&A trend through the rest of the year.
  • Never Take a Practice Merger Off the Table

    About 20% of all CPAs who have the ability to decide when and if they will retire will simply choose “turn out the lights” as their exit strategy. There are better options. Consider a merger for your firm as a succession plan.
  • Use the Busy Tax Season to Test Succession and Transition Viability

    Successfully transitioning a CPA firm is predominantly about leadership skills and control. That’s why busy season—a time when resources are pushed to their limits—is the perfect time to determine whether or not you have the right team to perpetuate your practice.

Journal of Accountancy

Navigating the Path to Success in Accounting Practice Sales

Harry L. Olson, CPA, advises that knowing how to avoid major hazards when seeking a buyer can make all the difference between a profitable conclusion and a disastrous outcome.

PICPA TV

Key Succession Planning Tips for Small CPA Firms
Key Succession Planning Tips for Large CPA Firms
How to Value an Accounting Firm in the Succession Planning Process
CPA Conversations

Important Phrases to Listen for during M&A Conversations

When you’re talking to another party about a merger or acquisition, there are going to be things you want to hear and things that make you hesitant should they come out of your counterpart’s mouth.
 

Listen In

Transition Advisors:
Merger Acquisition Transition Succession f

PICPA members are eligible for a free consultation with Transition Advisors LLC, one of the country’s leading consultants on succession, M&A and partnership issues.

Learn More