KEN KIRSCHENBAUM, ESQ
ALARM - SECURITY INDUSTRY LEGAL EMAIL NEWSLETTER / THE ALARM EXCHANGE
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Advice on Employee Retention Credit solicitations  / comment on Time to Sell 
November 21 2022
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Advice on Employee Retention Credit solicitations
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Ken,
          Alarm company businesses, like other businesses,  are getting barraged by calls from what we call “Credit Mills.”  These are telemarketers who called businesses in an attempt to get them to file for the Employee Retention Credit.  Although this is a legitimate credit, and is for a lot of money, there are some strict limitations.  The IRS is aware of the Credit Mills and is estimating that there could be as much as a trillion dollars of credits claimed by companies that aren’t eligible. 
          The other thing to be careful about is that while some of the IRS guidance is vague, submitting a vague request is not a good idea.  The IRS will process the return, then audit it, and come to see you if you received the credit in error.  The penalties could be in the hundreds of thousands of dollars, and, if they believe that a Taxpayer acted in bad faith, there could be criminal consequences. 
          I wrote an article for Security Sales and Integration that explains it all.  Take a look at it and email me with questions. 
 https://www.securitysales.com/business/clarifying-employee-retention-credits-how-to-receive-payroll-tax-refunds/
  Mitch Reitman
MReitman@Reitman.US
Reitman Consulting Group
Fort Worth, TX 76133
817-698-9999
http://www.reitman.us
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Response
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          As I understand it you are not entitled to the Employee Retention Credit unless you have a loss in any one quarter during the covid shut-down.  That of course is only one criterion. 
          You should be aware that it’s not a good defense to simply claim you were advised to file, especially when the advice is from some outfit who found you on the Internet.  As business owners you should have professional tax advisors and accountants who you regularly rely on, and if you don’t, Mitch Reitman is one phone call away; don’t be foolish, call him.
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Comment on Time to Sell article on November 10, 2022
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Ken
          Weighing in on the November 10, 2022 article in which “Name Withheld” asked for a “checklist” so he could sell his business;  While it’s good that you told Mr. Withheld not to “DIY” it I wanted to weigh in that Withheld shouldn’t try to DIY the tax consequences either.  The sale of a business is a complex event and the tax consequences of not planning for it, or even reporting it properly, can result in hundreds of thousands of dollars of taxes that could have been avoided. 
          Withheld should ensure that his preparer is an experienced transactional accountant. 
          We have been involved in hundreds of alarm company sales and we know the rules governing their taxability.   I can’t tell you how many conversations that I have had with CPAs who don’t understand the industry and are making decisions that would have cost our new client hundreds of thousands of dollars.  He made the first step in reaching out to you to garner your experience; he should do the same when it comes to accountants.
  Mitch Reitman
MReitman@Reitman.US
Reitman Consulting Group
Fort Worth, TX 76133
817-698-9999
http://www.reitman.us
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Response
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          Many, though certainly not all, alarm business owners understand that that the lawyer or accountant they have used or do use has limitations.  As a matter of fact, we all have our limitations.  “A man needs to know his limitations”.  I think Dirty Harry said that.  It couldn’t be truer for lawyers and accountants, and most professionals do know their limitations, though some don’t care as long as they are getting paid.
          In the first paragraph of the Kirschenbaum & Kirschenbaum Retainer Agreement we have a simple sentence:  “We do not give tax or accounting advice, engage a tax professional”.  If there is another tax or accounting firm other than Reitman Consulting Group that specializes in the alarm industry I am not aware of them. 
          Your money will be well spent if you engage Mitch for an hour to consult on your deal.  You may find out that for a few bucks you can save a lot more. 

          The choose your professionals carefully extends to business brokers, insurance brokers, perhaps advisors on marketing and best equipment to use, which central station may be best for you.  I guess by now you know that I think there’s really only one choice for an alarm lawyer, but some like to learn the hard way. 
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Ken Kirschenbaum,Esq
Kirschenbaum & Kirschenbaum PC
Attorneys at Law
200 Garden City Plaza
Garden City, NY 11530
516 747 6700 x 301
ken@kirschenbaumesq.com
www.KirschenbaumEsq.com