Generating a tax loss is one thing. Being able to actually use it is another.

Ian and Jeremy dig into the material participation rules and why understanding the difference between active and passive income is critical before jumping into a tax strategy or investment promising massive deductions.

They break down the material participation tests, including the familiar 500-hour and 100-hour rules, as well as the lesser-known tests that can unexpectedly pull an activity back into active treatment. They also discuss real estate, short-term rentals, cost segregation, passive K-1 income, oil and gas investments, and situations where intentionally becoming passive can create significant planning opportunities.

The conversation also tackles a growing problem in tax planning: strategies that look impressive on social media but fall apart once you examine the actual tax law. The takeaway is simple: before chasing a deduction, understand how the income and loss will be characterized—and whether you can actually use it.

• Active vs. passive income
• The seven material participation tests
• The 500-hour material participation test
• The 100-hour / no-one-else-does-more test
• Facts-and-circumstances material participation
• Prior-year participation rules
• Special rules for personal service businesses
• Real estate professional status
• Short-term rental strategies
• Cost segregation and bonus depreciation
• Grouping elections
• Passive K-1 income and why it can create planning opportunities
• Form 8582 and passive activity loss carryforwards
• Why generating a tax loss doesn't mean you can use it
• Evaluating tax strategies promoted on social media
• Understanding the incentives of whoever is selling a tax strategy
• Why some legitimate tax strategies still come with significant strings attached
• The importance of working with an advisor who understands how all the pieces of the tax code interact

When your CPA tells you something is "risky," they're not necessarily saying you're going to get audited.

Ian and Jeremy break down the different types of risk that business owners and their advisors should be thinking about—from aggressive tax positions and poor documentation to penalties, professional fees, bad bookkeeping, due diligence problems, and even risks buried inside the operations of the business itself.

They discuss why a technically defensible tax strategy still might not make economic sense, how documentation can dramatically change the outcome of an IRS examination, and why spending a little more time getting things right today can prevent an expensive problem years down the road.

The broader lesson: risk should be evaluated against the potential reward, the cost of defending the position, and the consequences if you're wrong.

• What CPAs mean when they talk about "risk"
• Firm risk vs. taxpayer risk
• Audit risk and defensibility of tax positions
• Documentation and substantiation
• When a CPA may refuse to sign a return
• Short-term rentals and material participation
• Cost segregation and increased scrutiny
• Estimated tax payments, safe harbors, penalties, and interest
• Why clean books and balance sheets matter
• Underreported income and extended statutes of limitation
• Preparing documentation contemporaneously
• QSBS and the importance of maintaining clean historical records
• Buyer due diligence and risks that can reduce or kill a business sale
• Operational liabilities that may never appear on a tax return
• Why the size of the tax savings alone doesn't determine whether a strategy makes sense

A $10 million offer for your business sounds great—but how the deal is structured can dramatically change what actually ends up in your pocket.

Ian and Jeremy break down the difference between an asset sale and a stock or ownership-interest sale, why buyers and sellers often want opposite things, and how purchase-price allocation, basis, depreciation, liabilities, and capital gains can affect the economics of a transaction.

They also discuss situations where a stock sale may be necessary, how a Section 338(h)(10) election can bridge the gap between buyer and seller objectives, and why strategies such as QSBS and ESOP planning require significant lead time.

The bigger takeaway: don't wait until an LOI lands on your desk to start planning your exit. Understanding your options years in advance can create significantly more flexibility—and potentially millions of dollars of difference in the final outcome.

• Asset sales vs. stock/ownership-interest sales
• Why buyers generally prefer asset purchases
• Why sellers often prefer stock sales
• Purchase-price allocation and Form 8594
• Step-up in basis and depreciation/amortization
• Goodwill and the 15-year tax amortization period
• Pre-existing liabilities and warranty exposure
• Section 338(h)(10) elections
• Inside vs. outside basis
• QSBS / Section 1202 opportunities
• ESOP and Section 1042 planning
• Why business-sale planning should begin years before an LOI
• Looking beyond the headline purchase price to after-tax proceeds and replacement cash flow

Accounting software like QuickBooks can be a phenomenal tool—but putting good software in the hands of someone who doesn't understand accounting doesn't solve the problem.

In this episode of Nailed It, Jeremy and Ian break down a real client situation where bookkeeping errors nearly caused approximately $145,000 of unnecessary taxes. The books appeared to tie at first glance, but digging into the general ledger revealed entries that effectively moved previously taxed amounts back onto the income statement—creating the potential for the client to pay tax on the same economic income twice.

They discuss why adjusting journal entries from your CPA actually need to be posted, the importance of rolling retained earnings and capital accounts correctly, and why a tax preparer simply plugging numbers from the client's books into a return can create significant risk.

The takeaway: good bookkeeping isn't about having QuickBooks or hiring someone with "accountant" in their title. It's about having someone who understands the fundamentals, knows when something doesn't look right, and is willing to ask for help before a small accounting mistake becomes a six-figure problem.

Permanent life insurance can be a valuable planning tool—but when complicated insurance, investment, and borrowing strategies are sold to the wrong client, the results can be devastating.

In this episode of Nailed It, Jeremy and Ian dig into a real-world situation involving a client whose relatively modest net worth became tied up in permanent life insurance, securities-backed borrowing, alternative investments, and substantial advisory fees. They explain how strategies that look impressive in an illustration can become dangerously fragile once interest expense, commissions, policy costs, investment performance, and liquidity are factored into the equation.

They also discuss when permanent life insurance legitimately belongs in an estate or business-planning strategy, why incentives and commissions matter, and the warning signs that an advisor may be recommending products that benefit the advisor more than the client.

The takeaway: complexity isn't sophistication. Before committing significant wealth to an insurance or investment strategy, understand how everyone gets paid, what can cause the strategy to fail, and whether it actually fits your financial circumstances—and get a second opinion.

Everyone on social media seems to have the same tax strategy: form an LLC, elect S corporation status, pay yourself a salary, and magically save 15.3% in taxes. The problem? That advice skips nearly everything that actually determines whether an S corp makes financial sense.

In this episode of Nailed It, Jeremy and Ian break down the real math behind the S corporation strategy. They explain reasonable compensation, why the IRS cares about the relationship between salary and distributions, when a one-person business can have trouble defending a low salary, and how additional tax-return and payroll costs can completely wipe out the supposed savings.

They also dig into situations where an S corp can work—particularly businesses that leverage employees, systems, or technology rather than relying entirely on the owner's labor. Plus, they explain why business owners who already exceed the Social Security wage base through a W-2 job may receive far less benefit from an S election than social-media tax gurus suggest.

The takeaway: an S corp isn't inherently a tax strategy. It's an entity and tax election that needs to fit the economics of the business first.

As businesses grow beyond their home state, state tax compliance becomes significantly more complicated. In this episode of Nailed It, Jeremy and Ian break down the concepts of nexus, allocation, and apportionment in plain English, explaining how having employees, property, or sales in another state can create tax filing obligations that many business owners—and even some tax preparers—overlook. Using examples from construction companies and real estate investors, they discuss why forming an LLC in a "tax-friendly" state doesn't eliminate state tax responsibilities where the business is actually operating, and how proper planning can help avoid unnecessary penalties and double taxation.

The conversation also highlights the importance of working with a CPA who understands multi-state taxation before expanding into new markets. Jeremy and Ian explain how proactive planning can influence staffing decisions, project scheduling, and tax strategy, while also sharing real-world examples of businesses that paid more tax than necessary because state tax credits and filing requirements were handled incorrectly. Whether you're crossing state lines for construction projects or investing in rental properties across the country, this episode provides practical guidance to help you stay compliant while minimizing your overall tax burden.

Not every CPA who says they specialize in construction actually understands the unique financial and tax challenges contractors face. In this episode of Nailed It, Jeremy and Ian discuss the warning signs that your accountant may be providing little more than basic tax compliance instead of meaningful strategic advice. They explain why generic year-end tax planning—such as buying equipment, paying bonuses, or maximizing deductions—can actually reduce a contractor's bonding capacity, limit future backlog, and cost far more in missed opportunities than it saves in taxes. The conversation also highlights the importance of work-in-progress (WIP) schedules, job costing, percentage-of-completion accounting, and other construction-specific financial metrics that separate true industry specialists from general practitioners.

Beyond compliance, Jeremy and Ian explore what real value-added advisory looks like for construction companies. From identifying project fades and underbillings to improving profitability, optimizing bonding relationships, and planning for an eventual business exit, they explain why your CPA should be helping you make better business decisions—not simply filing tax returns once a year. If your accountant isn't asking about your WIP schedule, backlog, bonding capacity, or succession plans, this episode will help you determine whether you're working with a true construction advisor—or just another tax preparer.