Having A Trusted Team Is So Important

I believe in having trusted advisors (Accountant –Banker – Lawyer – Business Coach – Consultants ) that you can work with and trust in. BUT also keep an open mind about what these people are telling you. DO NOT blindly believe everything they tell you, get a 2nd opinion. If advice doesn’t pass your smell test, get a 2nd opinion.

A very good example of this past the few months was the ARC loan offered in the Stimulus program. There were some banks telling their customers it was fraud or others that it wasn’t good for the borrowers business to take one of these loans. WRONG!!!!! Get a 2nd opinion!!

I had a consultant tell a business this past week that if this business hired one more employee they HAD to get health insurance for all of their employees. WRONG!!!! There are laws stating what benefits you must have for employees like FICA – Medicare – Work Comp Insurance – Un-employment and minimum wage laws. There is no law that says you have to give health insurance to your employees. There is no law that tells you how much vacation time to give to your employees. In Minnesota, DEED (Department of Employee and Economic Development – http://www.deed.state.mn.us/publications/ ) has a publication that is a great help. This web site has a number of other publications that you help you also. Also check the Federal government web sites for information.

One of the businesses I have worked with was set up by a tax preparer (NOT A CPA!!) The business was set up as a C Corp – not a S-Corp. The first year, the company took a huge loss. This business owner had a lot of other income that the loss could have offset for the owner if the corporation had been set up correctly. I am working on 4 other companies right now set up as C corps and we are working at getting them switched to S corps. There are a lot of issues to be resolved if a company is set up incorrectly.

In the past months I have had accountants and lawyers give out bad advice also. This happened to me. I was in a complicated land transaction involving a development. We had been given accounting advice that we passed on to the lawyer (a very large firm specializing in this type of transaction) . He wrote an agreement that 1) would have cost my partner and I hundreds of thousands of dollars 2) did not pass the accountants test of legality (He wouldn’t do our taxes if we moved ahead with the transaction worded the way it was. ) We got 2nd opinions and in this case it took 3rd and 4th opinions to get it right.

These are just a few examples. Get a 2nd opinion. The couple of hundred bucks it might cost you may save you thousands and thousands later.