Few things are more important to business owners than the value of their business.
What is your business worth?
Whether you’re negotiating a sale, a merger, considering new shareholders, attempting to resolve disputes associated with liability, shareholder equity, estate planning, or marital dissolution, objective valuation can make the difference between loss or gain, success, or failure.
Not knowing what your business is worth can result in incorrect decisions.
One young businessperson started a business and was struggling to make ends meet after two years in the business. He thought he might make more as an employee. His viewpoint shifted when he found out his business was worth $200,000.
Another businessperson had a dotcom, before the bubble burst back around 2001. He was having trouble-making payroll. He was thinking of selling 1/3 of his company for a couple hundred thousand dollars. He had a consultant review his business who said “It may be a hassle meeting your payroll, but don’t sell for that.” Six months later, this dotcom sold for $10,000,000.
Business valuation is based on judgment, experience, and relevant information. So, you need professionals at Torchlight Tax and Accounting Las Vegas who are well qualified, with significant experience in evaluating all types of organizations.
Our approach is to intimately know your business to understand what constitutes its value. We work closely with you to analyze your operations and historical financial data. Our in-depth knowledge of your business enables us to provide a well-reasoned, fully documented, and defensible valuation opinion.
There is a purpose of business valuation that is often overlooked. Suppose you are starting out or have a small business. Making a profit is of course a major goal and is a monitoring factor in all business decisions. You do not want to make decisions that lose money!
But there are businesses that were worth billions of dollars before they made a profit.
Have you ever wondered how your business is valued?
Or, even better, what can you do to increase the value of my business?
Of course, profit is important in valuing a business. You should monitor it closely. Proper bookkeeping and accounting are important here. If your accounting is very good, and you review your accountant’s work regularly, you can probably get an exterior view of what makes your business make money. Many businesspeople work like mad for years without ever sitting back and looking at their actual profit.
Often business owners are working like mad in the trenches making income and delivering product, and are too busy to do their books or look at trends.
Now, if you have proper bookkeeping and accounting, you can look at your profit and loss for small and large periods of time.
If you decide to do this, you can figure out what increases your profit. If you work at this, you can get your profit up.
Increasing profitability is a factor in the valuation of a business, but there are many other factors. What if you set out to improve these factors and make your business more saleable in 5 years? We at Torchlight Tax can help you do this.
We can set up your business as the best entity for expansion and saving tax dollars. We can do your books so you have a proper Profit and Loss and Balance Sheet so you can see how you are doing. We can do your P and L on a weekly or monthly basis so you can act fast to re-enforce successful actions and eliminate losing strategies. Additionally, we can advise you on steps to take to increase the valuation of your business in the future.
We can review your business financials with you and factors that increase business value and discuss ways to increase that value.
There are many ways to increase your net worth, build wealth, and plan for retirement–IRAs, Roth IRAs, 401Ks, investing in stocks, investing in real estate.
One of the best is to systematically build the value of your business. One way to do this is to expand the business and its management so it makes money without you. Valuation is based on the expectation of future profit. If you have a well-established business that has increasing profits year after year, good equipment, competent staff, skilled management, and so on, then it is worth more.
If you do this, you may not need to sell it. Maybe you can retire early and sail around the world with a business running without you that has an ever-increasing profit.
Maybe you should expand it and go public.
We can do a valuation of your business. This is a good idea. The profitability of your business is one measure of its worth. But suppose your profit last year was $100,000 and you took it. Suppose the valuation of your business also went up $100,000. Worth knowing, don’t you think?
If you made $100,000 profit and your business went up in value an additional $100,000, in one sense you made $200,000 profit!
At Torchlight Tax and Accounting, we work with you to:
There are also specific situations that can Demand a valuation. These are discussed below.
Contact Torchlight Tax & Accounting in Las Vegas if you’d like to know how much your business is worth or to learn more about our business valuation.
Call us at 1-877-758-7797 or 702-463-1818 or email us at info@TorchlightTax.com. We can transfer your call to a branch office near you or help you directly from our central office. Free consultations are available.
Many people do not know how a professional tax and accounting firm differs from a bookkeeper or tax preparer. The main difference when working with a professional tax and accounting firm, such as Torchlight Tax, is that our firm utilizes the services of CPAs, EAs, and Attorneys who are distinguished from bookkeepers and other tax preparers by stringent qualification and licensing requirements. Our entire team has a purpose to legally save your tax dollars and to make taxes as painless as possible. This means we take your calls and respond to your concerns. If you receive a threatening IRS call or Notice or are worried about some tax question, we are here for year round taking your calls and responding to your emails.
Whether you are filing personal, small business, or corporate taxes, or negotiating IRS tax debt, if you are not already using a professional Tax, Accounting, and IRS Representation firm, you most likely have missed out on major tax benefits. This is because a professional tax and accounting firm utilizes licensed professionals such as Certified Public Accountants (CPAs), EAs and Attorneys, who can not only advise individuals on personal financial matters but who can also advise businesses and corporations of all sizes and types. Tax laws are complicated, and no one knows everything. Torchlight Tax is a team and any one of our tax pros can call on other EAs, CPAs, and Tax Attorneys in the team who may have specialist knowledge in a specific area of tax.
When doing current taxes, we often come across missed tax savings from prior years. When this happens, the Internal Revenue Service allows you to amend your taxes and lower your tax liability. Whether you or your prior tax preparer missed a W-2 or 1099, a revised 1099. Large charitable donations, or made some other error, amending your tax return can help you recover the money you are rightfully owed. When we find this situation, we will advise you on potential savings and amend the previously filed tax return.
Sometimes, there may be a situation where a tax return could be amended, but it is too late to receive any benefit, or maybe you made an error that was missed by the IRS that would have increased your tax liability. In some cases, it is prudent to file an amended return. But if it is not necessary and will not save you any money or decrease your risk, we will tell you not to bother. It is silly to amend a return to no advantage, which is too old for the IRS to audit. Some firms might file a bunch of unnecessary tax returns and charge a fee. Sometimes a taxpayer himself might increase his tax liability by filing an unnecessary amendment that increases his tax liability. We will not do this.
Amending a tax return requires more professional acumen then doing it right in the first place. At Torchlight Tax, we do file the tax return correctly the first time, and we will happily amend your tax return, but only if it actually is to your benefit. If you think you might need to amend tax returns, contact Torchlight Tax for a free consultation.