Tax planning services goose firm growth; Steward Partners’ Jim Gold on firm’s M&A path; small biz tax savings
Financial Planning
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TAX PLANNING SERVICES: In the latest case for branching into areas that are traditionally beyond the services offered by financial advisors, Fidelity Investments' 2023 RIA Benchmarking Survey showed that the firms providing tax planning and strategy grow organically at nearly triple the rate of their peers, according to Anand Sekhar , the firm's vice president of practice management and consulting.
"The role of an advisor today is much different than it was five, 10, or even 30 years ago," Sekhar said in an email. "It's becoming increasingly table stakes for advisors to think beyond investment management and offer broader financial planning services and advice. At the end of the day, investors want a holistic view of their finances based on their unique needs and goals."
PRACTICE MANAGEMENT: By buying Freedom Street At Steward Partners , Steward Partners s will add 38 financial advisors and 17 offices to its roughly 200 advisor headcount and 45 offices throughout the U.S. The purchase also marks the start of a new division within Steward Partners aimed at growth through mergers and acquisition rather than recruiting.
Jim Gold , a founder and the CEO of Steward Partners, said in an interview Thursday that the division will be looking to acquire teams managing anywhere from $300 million to $10 billion. Gold said he thinks there's an opportunity to scoop up firms that value their independence but that are nonetheless looking for more back-end support amid tightening industry regulation and technology requirements.
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TAX STRATEGY: ?Clients who are small business owners or potentially interested in investing in startup stock may want to consider a frequently forgotten tax exemption for millions of dollars in capital gains.?
The qualified small business stock exemption in Section 1202 of the tax code enables shareholders in certain C-corporations to exclude capital gains amounting to the greater of $10 million or 10 times their investment from their income. While the exemption has critics questioning the budgetary cost to federal tax coffers and whether the tax break is truly fueling investments in businesses that are actually small, the provision of the code offers an opportunity for financial advisors, tax professionals and their clients to find significant savings.
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