AE Tax Advisors

My old CPA had my restaurant structured as a C-Corp. If you know anything about tax law, you know that a C-Corp makes absolutely no sense for a single-owner restaurant. I was being double-taxed -- once at the corporate level and again when I took distributions. For seven years, I was hemorrhaging money to the IRS because of this basic structural error.

AE Tax Advisors converted me to an S-Corp, which eliminated the double taxation immediately. But the bigger recovery came from what my old CPA had been missing for years: the FICA Tip Credit.

If you own a restaurant with tipped employees, the government gives you a credit for the employer portion of FICA taxes paid on tips above minimum wage. With thirty tipped employees, my credit was substantial -- and my old CPA never once claimed it. AE Tax went back three years and claimed the credit through amended returns.

They also identified employees who qualified for the Work Opportunity Tax Credit, which provides credits for hiring individuals from certain target groups. Several of my kitchen staff qualified, and those credits had never been claimed either.

Total recovery: $67,000. The fact that my old CPA missed the tip credit alone -- with a staff of thirty tipped employees -- is unforgivable. That credit is one of the most well-known restaurant tax benefits, and he either did not know about it or was too lazy to calculate it.

AE Tax Advisors saved my business. They handled the entity conversion, the amended returns, and the credit calculations, and set me up with a system that captures everything going forward. If you own a restaurant, get your returns reviewed.