Small Increase in Taxes Paid Yields Greater Long-Term Tax Savings
Background
Company is headquartered in southern California, and operates primarily in the sign and advertising specialties industry.
Organization has been operating for over 25 years, generates up to $5M in annual revenue, and employs between 15-25 people.
The Company was organized into an incorrect buyout structure from a former company, leading to tax inaccuracies and inefficiencies.
One of the Company owners was familiar with WFY through a relationship with a tax partner.
Approach
Wright Ford Young & Co. (WFY) was engaged to assist the Company with transaction structuring and to implement tax saving strategies.
WFY was able to design and deliver a permanent resolution to the incorrect buyout structure that corrected the tax reporting and increased tax savings.
Our CPA firm maintained frequent and consistent dialogue with the Company owners to reduce their anxiety and risk perception throughout the process.
Results
Wright Ford Young & Co. delivered a solution to the Company owners that yielded approximately $150,000 in tax savings over a three year period. And the fees only cost them an incremental $15,000 more than what they were currently paying, resulting in a 900% ROI.
Discovered Tax Refunds Lead to Avoided Bankruptcy
Background
Company is located in southern California, and operates primarily in the skincare industry.
Organization has been operating for over 30 years, generated up to $60M in annual revenue at its peak, and employed up to 25 people.
The Company desired a new accounting firm with a specialty in the cosmetic/skincare industry.
The Company was struggling with a lack of proactive tax guidance throughout the year from their prior accounting firm, and the Company felt that they were being over charged for the services delivered.
Approach
Wright Ford Young & Co. (WFY) was initially engaged by the Company to perform year end financial audits, and to prepare corporate tax compliance documents and personal tax returns for the business owners.
The Company was experiencing cash flow issues. WFY’s tax engagement partner assessed their current situation and
identified a new tax pronouncement that the Company was eligible for and qualified to receive.
Results
Wright Ford Young & Co.’s tax strategy helped the Company to obtain over $1 million in tax refunds to avoid filing bankruptcy. This outcome kept the Company afloat until they found a buyer of the business for $60 million.
Company Turned to WFY for their Growth and Tax Savings Needs
Background
Company is located in Florida, and operates in pharmaceuticals preparations industry.
Organization has been operating for almost 10 years, generates up to $5M in revenue annually, and employs between 10-25 people.
The Company was experiencing fast growth and felt they were paying too much in taxes.
As a new operation moving into the California market, the Company was searching for potential tax savings ideas by continuing to have some operations outside of the state.
The Company was struggling with the feeling that they had outgrown their small practice CPA who could not keep up with the Company’s growth expectations.
Approach
Wright Ford Young & Co. (WFY) was engaged to provide timely tax savings solutions and business consulting services.
WFY identified a more accurate and efficient tax accounting method to better match the Company’s growth plans with their need to save on taxes to help finance their growth.
Results
WFY successfully implemented the change in accounting method for the Company, which resulted in a direct $250,000 of tax savings in year one and a projected tax savings of $20,000 to $30,000 annually for the next 2 to 3 years.
