So I'm about 6-9 months out from listing my landscaping business. Broker says get my tax filings clean before we go to market. I've always just handed stuff to my CPA and signed. What actually matters here? Am I overthinking it?
Tax Prep
Preparing your tax filings before going to market
You're not overthinking it. Buyers and their accountants will tear through your returns. Sloppy filings = renegotiation leverage or a dead deal. Get three years minimum in order, and make sure your personal and business stuff isn't commingled.
Kind of depends on your entity structure and how clean the books already are, honestly. If you're a sole prop with a shoe box of receipts, start now.
Agree with grumpybeaver but also make sure your CPA knows the goal is a sale, not just filing. A lot of them file to minimize tax and that's it. You wnat returns that tell a clean profit story without looking artificially inflated. Different objective.
what's your revenue range? under a certain size buyers care way less about historical filings and more about the last 12 months of bank statements
Disagree on that. Even smaller deals get diligence. And if your last three years show wild swings or a big drop in year 2, you'll be explaining it whether you like it or not.
Also watch for personal expenses run through the business. Buyers will flga every single one and ask you to add them back. Better to know that number before they do.
Hire a tax attorney or a CPA who has done M&A deals. Not your cousin's guy who doez 1040s. Ask them upfront.
This is helpful. The personal expenses thing is going to be an issue — I've been running a lot of stuff through the business for years. My CPA is definitely more of a compliance guy. Probably need to find someone else for this this.