The best tax advice for small business owners: never leave deductions behind. If your CPA doesn't know about an expense, they can't deduct it. Track everything—business expenses, charitable contributions, mileage—then let your accountant determine what qualifies. Over-communicate rather than assume, and you'll pay less tax legally.

3. TL;DR

• Track everything: Don't assume the standard deduction is better—give your CPA all the data to compare
• Over-communicate expenses: If you don't tell your accountant, it won't get deducted
• Mistakes happen: Even the IRS makes errors; have a CPA who'll represent you and manage the process
• Don't let tax wag the dog: Real estate rentals and other tax strategies only work if they fit your life
• Diversify eventually: High earners often focus on one income stream early, then diversify as the business stabilizes
• IRS audits are targeted: They focus on anomalies (like sudden windfalls), not random small businesses
• Retention is relationship: Clients stay because of personal connection—lose the contact, risk losing the client
• Take a breath under pressure: Step back, control what you can control, and remember mistakes are fixable

Tax Advice for Small Business Owners: What 25 Years as a CPA Taught Me About Keeping More Money

It’s 11 PM on April 14th, and you’re staring at a shoebox full of receipts.

You think you’ve captured everything. Maybe you haven’t. Maybe there’s a $12,000 deduction sitting in that stack you forgot to tell your accountant about because you “weren’t sure if it counted.”

Spoiler: It probably counted.

Brandon Verner has been a CPA for 25 years. He’s a partner at Sumner, a 150-person accounting firm in Atlanta. He’s seen founders leave tens of thousands on the table because they were too embarrassed to ask, too overwhelmed to track, or too confident they’d already maximized their deductions.

This isn’t about gaming the system. It’s about not overpaying the IRS because you didn’t know the rules—or didn’t think to ask.

Here’s what Brandon learned from a quarter-century in the tax trenches, a firm merger, his father’s sudden illness, and thousands of conversations with business owners who just wanted to keep more of what they earned.

What’s the #1 Tax Mistake Small Business Owners Make?

They leave deductions behind.

“If we don’t know about it, we can’t take it,” Brandon says. “I’d rather clients give me too much information than not enough.”

It sounds simple. It’s not.

Business owners assume their accountant will “just know” what to deduct. Or they think the standard deduction will cover them. Or they don’t want to bother their CPA with “small stuff.”

Wrong on all counts.

Runway equals cash in the bank divided by monthly burn rate. You already know that. But here’s the tax version: Deductions equal every legitimate business expense your CPA knows about.

If you don’t tell them, it’s not getting deducted.

On the individual side, Brandon sees this with itemized deductions. Clients assume the standard deduction is the best option. Sometimes it is. Often it’s not.

“We don’t know unless we take all the pieces—charitable contributions, state taxes, mortgage interest—and compare,” he says. “Some people just don’t want to gather all that information. That’s fine. But I hate for you to give the IRS a dollar more than you have to.”

The Rule: Track Everything, Let Your CPA Decide

Brandon’s advice is ruthlessly practical:

First, capture every business expense, even if you’re not sure it’s deductible.

Second, document charitable contributions, mileage, and home office use on the personal side.

Third, hand it all to your CPA and let them use their expertise to separate the wheat from the chaff.

“Even if you’re not sure if it’s allowed, give us the information,” he says. “This is not a deductible expense, but all this other stuff is. If you don’t tell us, it’s not going on the return.”

It’s the tax equivalent of “you miss 100% of the shots you don’t take.” Except in this case, you’re paying 100% of the tax on income you could have sheltered.

Should You Turn Your Primary Residence Into a Rental Property?

Maybe. But probably not for the reason you think.

“I get asked this all the time,” Brandon says. “Someone’s moving, and they’re like, ‘Should I turn my existing home into a rental?’”

From a tax perspective, it can be fantastic. You get depreciation. You deduct repairs, property management fees, mortgage interest, and property taxes against rental income. You might even be able to take a passive loss if your income qualifies.

But here’s the question Brandon always asks:

Do you want to be a landlord?

“If you’re like, ‘No, I don’t want to deal with repairs, maintenance, and tenants,’ then throw tax out the window. It’s not the way to go.”

This is the “Don’t let tax wag the dog” principle.

Real estate can be a phenomenal wealth-building tool. But if you hate the thought of 2 AM calls about a broken water heater, the tax benefits won’t make you happy.

Brandon also points out that vacation rentals can be lucrative if you have the right property in the right location. “If you do, you can do really well. But if you don’t, the cash outflow can be very high. HOA fees, management fees—it adds up.”

The best tax strategy is one that fits your life, your risk tolerance, and your actual goals. Not just the one that looks good on paper.

How Do High Earners Actually Diversify Their Income?

Brandon has seen thousands of tax returns. From $1 million W-2 earners to bootstrapped SaaS founders to private equity partners.

Here’s what he’s learned:

Most high earners are NOT diversified early on.

They’re all-in on their business. Every dollar, every hour, every ounce of energy goes into building the thing that’s working.

“I think it comes down to time and putting their energy to what they do best,” Brandon says. “A lot of that is focus on their business.”

Diversification happens later—once the business is established and running without them micromanaging every function.

Then they start investing in real estate, buying into other businesses or funds, building a taxable brokerage account alongside retirement accounts, and getting involved in private deals like angel investing or venture funds.

But in the early days? It’s singular focus.

“We’ve seen it over the years where somebody is fully vested in their company’s stock, and the company’s gone. Their job is gone. Everything’s gone,” Brandon says. “So diversification is important. But it takes time.”

The Tax Returns That Surprise You

Brandon has prepared returns with $10 million in W-2 income. Just wages. Nothing else.

He’s also prepared returns for $10 million earners who have 50 different investments across real estate partnerships, private equity, consulting income, and carried interest.

“It’s a range,” he says. “And I guess it does depend on the person.”

The lesson: There’s no “correct” allocation. But there is a right sequence. Build the business first. Then diversify as capacity and cash flow allow.

What Do IRS Audits Actually Look Like in 2025?

“There are definitely audits,” Brandon says. “But what I have found is they’re very pointed. They’re looking to see where they’re going to find money.”

Translation: The IRS is understaffed and overworked. They’re not wasting time on random $100K small businesses unless something looks off.

What triggers an audit?

Sudden income spikes. You made $200K annually for five years, then your business sold for $10 million. They’re going to take a look.

Large deductions relative to income. $500K in expenses on $600K in revenue raises eyebrows.

Mismatched 1099s or W-2s. If your reported income doesn’t match what the IRS has on file, expect a letter.

Cash-heavy businesses. Restaurants, retail, service businesses with lots of cash transactions get more scrutiny.

But here’s the good news: If you’ve done everything right, an audit is just a pain. Not a disaster.

“I have no problem with an audit,” Brandon says. “If you have nothing to hide and you’ve done everything right, it’s really just a pain.”

What Happens During an Audit?

Your CPA, hopefully, handles it. They represent you. They gather documents. They answer questions.

“We try not to let clients talk to the IRS,” Brandon says. “The IRS is trained to have a conversation and get around the professional to ask questions they don’t need to be asking.”

The process can take months, sometimes six months or longer, especially if there’s a government shutdown or the IRS is backlogged, which is often.

The key: Don’t panic. Communicate with your CPA. And let them handle the IRS.

Why Do Clients Leave Their CPA? And How Do You Avoid It?

Brandon learned this the hard way.

His father, Mike Verner, was a partner in their firm for decades. He was the face of many client relationships. Early riser, late leaver, obsessive about accuracy.

Then, almost overnight, he couldn’t work anymore. Memory issues kicked in. He went from doing his job “totally fine” to unable to function in the role.

“It was one of those things where we’re going through the middle of this merger, and all of a sudden my partner isn’t there,” Brandon says.

The merger with Sumner saved them. But they still lost clients.

Why?

Because clients stay for the relationship.

“A lot of the reason I have the clients I have is because they like working with me or they have a relationship with me,” Brandon says. “If I’m not there, that makes it a lot easier for them to go, ‘Oh, my neighbor is a CPA. I never thought about him, but now my relationship person is gone.’”

The Key Man Risk Problem

Every professional services firm has this problem. The partner is the relationship. The team does the work. But if the partner leaves, retires, or in Mike’s case can’t work, retention drops.

Brandon’s firm now has a five-year transition process for retiring partners.

Let clients know early: “I’m retiring in five years.”

Introduce the new contact: “So-and-so will be your main point.”

Keep the retiring partner involved while the new one builds trust.

Over five years, clients get comfortable with the transition.

“We try to bring other people into the relationship so if I’m on vacation, the client knows they can rely on another person at the firm,” Brandon says.

It’s a lesson for any founder: Your business is only as resilient as your relationships.

What Should a Founder Under Pressure Always Do?

Brandon’s been there. His dad got sick in the middle of a merger. He’s had lean years. He’s dealt with IRS notices, client crises, and the existential dread of “Am I going to make payroll?”

His advice?

Take a breath.

“Step back and take a breath when those crises happen,” he says. “Realize you can control only what you can control. If it’s out of your control, there’s only so much you can do.”

It’s not sexy. It’s not a growth hack. But it works.

Mistakes Happen—Communicate Through Them

Brandon once told a young accountant: “Mistakes happen. They still happen today. They’re going to happen tomorrow. You just have to communicate with the client.”

It’s the same advice he gives to founders.

When cash is tight, when you miss a projection, when a hire doesn’t work out—don’t hide.

“We are not perfect. We are going to make mistakes,” Brandon tells prospective clients upfront. “We’re dealing with numbers upon numbers. It’s really easy sometimes for a six and a three to get turned around.”

The clients who stay are the ones who trust you’ll own it and fix it.

The ones who leave are the ones who never heard from you when things went wrong.

How Do You Actually Get Better at This?

Brandon started bagging groceries at 14. He made $3.85 an hour. He loved it.

“I always had that drive in me,” he says. “I always wanted to work. I was so excited to be able to make my own money.”

When he graduated college, he asked one question: “What do I have to do to be partner?”

Not “How much will I make?” or “What are the hours?”

But “What are the characteristics I need? What goals do I need to set?”

He worked at a large local firm for four years. Then he joined his dad’s firm. Twenty-five years later, he’s a partner in a 150-person firm.

The through-line?

He never got complacent.

“If you never take on new clients, you’re just looking for the firm to die at some point,” he says. “You can’t get complacent in your book of business.”

Every year, some clients leave. They get acquired. They retire. They move. They die.

If you’re not growing, you’re shrinking.

The same is true for your business.

The Bottom Line

Brandon Verner has spent 25 years in the tax trenches. He’s seen windfalls and wipeouts, mergers and meltdowns, pristine books and shoeboxes full of receipts.

Here’s what he’d tell you if you were sitting across from him today:

Tell your CPA everything. Over-communicate. If you’re not sure it’s deductible, mention it anyway.

Don’t let tax strategy override common sense. A rental property that makes you miserable isn’t worth the depreciation.

Diversify when you can, but focus comes first. Build the business, then branch out.

Audits are targeted, not random. The IRS is looking for money, not hassling $200K sole props for fun.

Relationships drive retention. In accounting, in business, in life.

Mistakes happen. Own them. Communicate. Fix them.

When pressure hits, breathe. Control what you can. Let go of what you can’t.

And if you’re growing fast, losing sleep over cash flow, or wondering if your books can survive a Series A diligence process?

Maybe it’s time to talk to someone who’s been there.

AdaptCFO is a fractional CFO and accounting firm for growth-stage startups in the US. We work with companies from pre-revenue to around $50M, helping founders like you build financial infrastructure that scales.

We’ve been in the room when the runway hits three weeks. When the term sheet falls apart. When the IRS sends the letter.

And we know how to get you through it.

Want to hear the full conversation? go listen to episode 13 of Growth Under Pressure:

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