Not the commenter, but my thoughts. Sure, covering rent and software has some value, but at the same time, in a small practice, those are usually very small % of costs and revenue. Payroll is honestly most of the cost/issue here. As you have indicated that you need high knowledge, high skill, high responsiveness, and to put your clients/referrals first. But will also be paying less than market. So to get on the same page, what amount do you consider market and what do you want to pay this person (in exact dollars)? As will you be paying going firm rates, wage rates, rates for highly experienced staff, etc?

A few thoughts:

• Do you personally have the capacity to service all of his clients, if heaven forbid, he drops dead tomorrow. Or would it be stretching you to the breaking point. As I have no idea about your capacity nor goals.
• What are both of your goals? As it sounds like for him, legacy and working in the practice (though I have no idea if that is just being a technician or still dealing with admin issues). Though if so, what does legacy mean to both of you?
• Why did you start your own practice? Is the culture of it similar to his practice? Or do you think there would be significant differences, which could lead to a lot of butting of heads.
• Has he done any succession planning? Anything from having other partners or staff to pick up the slack, to an agreement with other small firms to take over and in theory create some value for the estate and to keep on servicing clients.

I know that PPC and the AICPA both have letters for a variety of services. As well as you may want to check with your insurance provider and then have a local (to you) lawyer review it.

Like others have mentioned, go talk to a tax pro. Most smaller shops should be able to handle something like this, assuming that they have been through a few M&A transactions. And unfortunately, there is a lot of ground to cover in your questions and a lot of unknowns (if you want a holistic answer; which I'm not going to attempt to ferret out, as reddit isn't the best medium to do so), such as:

• What (and how much) other income do you have besides this business?
• Where is the business operating and where do you live?
• What is your timeframe?
• What allocations have been proposed (as that will largely drive the character of the gain)?

And since the 15th (both Sept and Oct) are deadlines, I would suggest reaching out to tax pros after them.

Like some of the other posters have mentioned, Built to Sell definitely (to give you an idea about the process and some potential steps to take). I would suggest the author's other books as well, The Art of Selling a Business and The Automatic Customer. Traction is good for getting goals and the right feet in the right seats.

But in general terms, some of the big things you can do to add value are:

• Get a management structure in place. So it isn't just the owner making all the decisions and creating the value.
• Develop internal systems and processes and then document said processes. So you aren't just relying on human capital (and instead have documented intellitical capital).
  
• If possible, try to make your revenue stream sticky. This could be cross selling or up selling services, or just some sort of reoccurring thing.

Otherwise, we probably would need slightly more details (and industry) to give better answers (as so far, you make it sound like a one person shop that is primarily service based, with significant overhead). And I swear I ran across at least one other book recently that seems like it would be a fit. I may try to dig it up tonight at home.

edit And the list above of things to add value doesn't include things that you should do now to potentially maximize the cash you walk away with, such as tax structuring (of the corporate entity), looking at what you would be selling and the potential tax considerations there. As well as just general documentation (such as is your stock register up to date and complete, do you have drafted and approved corporate minutes, etc).

Try /r/tax, as this sub is for professionals.

If she is waiting for her refund, the it a has been incredibly slow this year, due to multiple retroactive law changes. As for unemployment, did she provide the unemployment form to her tax preparer? And did to an exclusion, it may not have been taxable, so would be both a positive and negative amount on schedule 1.

This, for an equity play. Otherwise, I would probably just make a loan/ give a debt investment with covenants.

Both are things that you should probably try to hammer down, along with exact timeline and any other requirements. As I know a number of people in this sub and been promised equity or partnership and not had it materialize (if you search for similar topics, I know multiple people have shared their stories). And I've seen it happen at least one personally (and a handful of others that had to go get other offers before something materialized). Especially with the wishy washy promises of just one or two more years, and then the time comes and nothing materializes.

But if they will not be up front about the details, requirements, or timeline, I would probably walk, both as it is a good job market for people seeking employment and it shows that either they don't think you really are on the partnership path or they don't have a good succession plan in place.

Invest in a PE fund. /s As that is literally what they do.

Otherwise, you run into a number of issues or competitors:

• For very small businesses, there are usually one or a handful of owners/operators that are using it to generate funds for their lifestyle. So you would have to look hard at what they need your money for, as well as be aware of the number of ways they could drain the cash flow (huge salaries, related party transactins, etc). As you would very much need to trust them, and there are likely not enough internal controls to prevent any neferaous play.
• For slightly larger companies (think 500k to 5M EBITDA), you are competing with the smaller PE players (micro funds and search funders) as well as other wealthy individuals.
• Above that, you are competing with more mature/experienced PE players.

As for finding them, you could try business brokers or try trolling EDGAR and state security filing databases, looking for businesses that are raising funds.

Though, there have been few such things that I've run across (maybe only been a handful in about 15 years). 2 that are primarily employee owned with some limited outsiders (usually friends of the family), 1 that was found due to the guy networking with others, and the rest are primarily banks (due to usually multiple people coming together to raise funds for a bank in their community, or multiple families owning a bank due to merging multiple banks together over time). Personally, I like the banks, as it isn't uncommon for them to be priced at NBV (or even better at TBV; and they have a history of over 10% ROE). Now finding the banks is difficult, though can be a combo of looking at filings, or the handful of websites that list non public bank stock (such as banclist).

There really isn't an average, as it really comes down to expectations and what the client wants. As of someone wants to know everything that could be done, that would take a lot more time than going over general tax planning considerations for a business sale.

Generally, due to the nature of such, we usually price it using the staff's hourly rates, which range from about 160 to 300/he in a lcol. In a hcol or with a tax attorney, that could get up to a grand an hour.

Check out http://www.exeter1031.com/delaware_statutory_trust_dst_vs_tenant_in_common_tic.aspx for some of the downsides of the day structure. But in short, high fees, limited flexibility and probably 5-6% returns.

Otherwise, ask your qi about potential for installment sale treatment for a failed 1031. Assuming you will be in a lower bracket/income level next year.

Depends. Estate plans should be revised every few years or if there is change in circumstances (moving states, having a kid, a significant increase or decrease in nw, etc).

Tax advising should probably be done at least annually or before/ during any big changes (buying or selling a business or rental property, large changes in income or circumstances, etc). It if there is a major law change, as we have been through multiple ones since 2017.

A lot depends on the type of asset, and where you are. As I've seen the gamut of waterfalls for example, anything from 50/50 (investor to GP) for newbies in development or value add, to 80/20 for different sponsors for core or core plus mf. So, there are a large range of terms and fees, and not any average (though it seems like the most common I've run across is usually something in the 6-8% preferred and then 70/30 waterfall, for a value add multi-family play). I've not run into any airbnb syndications. Office and retail are more on the common side (though MF seems to be the most common), and storage is a bit rarer (so can feature less competive waterfalls/fees).

Though, if you want to see a slice of the market, I would probably join one of the crowd funding platforms, like crowd street and take a look at their deals. Granted, most of those sponsors are targeting multiple smaller investors.

As for the rest, there are literal books going over these topics, such as investing in real estate private equity by sean cook, real estate finance and investments by linneman, etc.

Heh, I like to think that I am good (am a tax guy, but not yours, nor am I looking for business), and have worked with others.

Like some of the other posters mention, some of what can be done, comes down to your sources of income (as a single owner business has a lot more options then W-2 wages). As well as what you want to accomplish (as most people want the most cash in their pocket; though if you just wanted to reduce your tax, I would say pay your accountant more, as it is a business deduction, but that doesn't help keep cash in your pocket); or if you want to minimize estate or GST, that would require different considerations than just reducing current year tax. On top of which, how much involvement/how risky you want to be (as O&G investments can generate large up front deductions, but are usually crappy investments; or conservation donations, of which the syndicated variety is being looked at hard by the IRS).

Otherwise, if you are honest, expect the initial fact finding mission to be hundreds, if not thousands of dollars, and take up some of your time. As the person will need to know your goals, what your situation is (operations and potential levers). And most likely they would have to walk you through some of the trade offs in various considerations. Though if you want an pure education session, going over the A to Z, it will most likely take a few days (and no, I've not seen any good one stop shop books or continuing education classes about it; both as the laws and techniques continue to evolve), and running down everything on the back end will be substantial cost as well.

So, as some background, I'm in a similar situation and while at my current firm, I've seen one income partner and two managers split away and start their own firms. As well as seen two other people become partner.

For me, some of the considerations include:

• For the existing partners, how close are they to retirement and what camps do they all fall in (avoid, tolerate, or have a good relationship with). As there is one guy that I really dislike (money hungry, not on board with growing the firm, behind the times technology wise, his way or the highway, etc), but he will be retiring soon.
• The current financials of the firm. As depending on your level and the software, you should have an idea of gross revenue of the firm, billing rates, and an idea of profits per partner.
• How explicit they have been with communicating everything with you. Has they explicitly mentioned that you are on the partner path? The length of time to get there (and any skills/goals you need to hit)? Or has it all been wishy washy, with nothing in writing, no set timelines, no set expectations or anything?
• Have you gotten a copy of the partnership agreement? Have they been open about things?

Basically, like some of the other posters have mentioned, buying into an existing firm is like getting into bed with someone, and you are getting some good and some bad. But it is up to you if you can tolerate the bad things (such as if there will be near term retirements, if the buy in isn't too huge relative to what you are getting, how much pain and effort it will be to correct or modernize practices, etc). But on the same token, it is a lot of work (and to an extent $$, between floating your living expenses and start up expenses; and more so if you buy a book of business) if you start out on your own. However, going out on your own gives you the chance to design a practice from the ground up, around what you want (such as if want to take summers off and still make a low six digit income, or to focus on putting the most money in your own pocket).

Either way, I would probably recommend the books: Securing the Future by Bill Reeb and How to Make Partner and still have a life. As well as if you are thinking of stepping out, probably to get a lawyer look over your contract, as well as maybe doing some digging to see if your firm has ever brought suit against a former employee.

Some good drugs? /s

But seriously, you are looking for an accountant, preferably one that deals with HNW individuals and to pay them for a few hours of their time to explain things to you, as it sounds like you want to go over in light detail what can be done at higher NWs, especially with business ownership. However, realize that some of the strategies you mentioned only make sense at significantly higher amounts of assets and a lot really depend on your specific situation. I mean, if you have to get a PAL on $200k, you would be lucky to get $100k in proceeds, and that would get you how far exactly (especially as most fatfire people are hoping for an annual spend in the 6 digits)?

If you were already in a field/career, that would be what I would say to you. However, it looks like from some of your other comments, that you want it pulled back a bit more, such as someone starting out (and where to aim for a large salary).

If that is more the case, if you are trying to determine what careers provide huge earnings and how future proof they are, I would probably start with the US Bureau of Labor Statistics and their occupantion outlook: https://www.bls.gov/ooh/ From that, there are then books to help with interviewing and potential resources as to how to get training to get one of those jobs (as most will need a college education and most likely niched in that field). Effective communication is often under-rated, but can definitely impact your compensation, from when you start (and negating your base) to campaigning for raises and the like.

I think the president/owner's comments are mostly the standard PR/spin control. Though at times, bank regulators (of which, the FDIC is one) can be zealous. But that doesn't necessarily mean that is the case here. As the holding company capital did increase roughly 3.5X times in 7 years, and a bank that grows fast is a risk factor for a bank failure.

If I had to paraphase, it sounds like what you are really looking for is books about how to increase your earnings. And that would probably be further split into increase your earnings while working for someone else, or working for yourself (owning a business of some nature). Is that a fair summary?

As there are a ton of books for each, depending on what you are getting at. As for myself, I'm an accountant employed by someone else, so I've been looking at books about how to generate sales and convey the value I/my firm can provide, such as the Sandler Method of Selling Financial Services, Implementing Value Pricing, various books by Alan Weiss (related to consulting and selling consulting services). As if I develop a ton of business, I can leverage that into raises and bonuses.

However, I'm also looking at ways to structure an accounting practice for profitability, so am looking at niche books in that field. Otherwise, I've also read a number of books related to real estate investment (as so often, REI is part investment and part business).

So it is 8% of gross. However, do realize that it is a mix of compliance and advisory. Breaking apart TNT's post, I would probably call $2k of it advisory, $4k as compliance (returns and payroll) and $6k as bookkeeping.

So, $6k of it is to save the client time that they would otherwise have to do it. In turn, they could use it to provide more service or attempt to make more sales. $4k of compliance is just the cost of doing business. However, the $2k is really advisory imho, and again, it depends on what he is doing and how the client takes it, as I could see it helping:

• The client with cash flow. As if their income is variable, knowing how much and when to make payments can be meaningful.
• Getting a handle on their business and helping them understand the changing landscape (and all of the tax credits and tax impact of grants these past 2 years).
• The ability to do one off, as I wouldn't be surprised if the client is more inclined to reach out if they want to do an equipment purchase, or something else with a large tax impact.

So, I'm not sure if you are approaching it from a standpoint of rolling in your tax advice with your compliance work (such as their quick questions during a client meeting while they drop off their paperwork), or something else. As with the former, it seems like you would have to upcharge for it/build it into your fees, or otherwise you are giving it away for no cost.

This, as it is the classic investor vs dealer treatment. Basically, what is his level of activity, how regularly is he buying and selling, and what is his intent.

Curious, but it sounds very much like you are offering a subscription model with different levels, though I'm unsure if it is a pick and choose services for the client, or if you have different set tiers (such as 3 levels, with more services at the higher levels). So, could you clarify?

As well as how are you marketing to and finding clients? Any resources for this sort of model that you would suggest?

Are you part of the sponsor/GP? As I've heard of internal loans to help fund their stakes.

Though if not, like just a random third party, I've run across some banks that will finance private stock/ownership (mostly bank stock), though usually at a lower LTV (50-60% is what I remember), at 6-7%, with a max payback/term of 6 years. As look at it from the bank's point of view, they are financing a nonliquid equity stake (so they couldn't convert to cash if things go badly), that they may not be able to value (so can't calculate LTV), and you can see why a lot of them don't want to touch such things.

Otherwise, if your equity portfolio is large enough, why not just use a cash out margin loan? Or if you use one of the full service brokerages (such as MS), give your broker a call and see what they can do.

Yeap, just dropped a month or so ago. Surprised me, and I usually read the authors blog, which didn't have a mention. Only found out due to a kindle notice.

Could you give some examples of such micro businesses? As I've seen/heard a few such stories (with the most detailed over on the fastlane forum about a guy that found a few websites and tech businesses that ended up being mostly passive and still generating over 100k+ combined).