CPA Donna Genie describes a client who runs a campground, rentals, and real estate but hid a laundromat purchase until tax time, leaving her without an EIN or partnership details. The lesson: spreading across too many businesses prevents any from thriving, and hiding ventures from your CPA costs you deductions and creates penalties.
I want to share a story that hits close to home for a lot of small business owners, especially those who are always chasing the next opportunity. One of our clients came to us feeling frustrated and overwhelmed. She owns several small businesses. A campground is her primary business, but she also has some rental properties, a real estate business, and recently she decided to buy a laundromat. Now, she's hardworking and entrepreneurial, but like a lot of business owners, She didn't mention the new business until tax time rolled around. When she asked if an extension had been filed for it, we had to explain we didn't even know the business existed. We hadn't been given any setup information, no EIN, no ownership details. And when we finally got those, we learned it was a multi-member LLC, which means it required a partnership tax return. Without that information, there's simply no way to file an extension or a return for it. Here's the bigger issue. She spread thin between all of these ventures that none of them are really thriving. She also doesn't want to pay for additional bookkeeping or accounting help for the smaller businesses because, in her words, they don't really make enough money to justify it. And I get it. When a business isn't producing much profit yet, it's easy to look at accounting as another expense. But here's the truth. But having clean books and clear direction is exactly what helps these small businesses become profitable. If every venture is barely getting by, it might be time to stop adding new ones and focus on making one business really successful before splitting your energy into 3 or 4 more. Growth doesn't come from owning more businesses. It comes from mastering one. The other lesson here is communication. When you make a big move, buying, selling, or starting a new business, Loop your CPA in right away. A 5-minute conversation up front can save you months of cleanup later and thousands of dollars in penalties or missed deductions. As your CPA, I'm not just here to help you file taxes. We're here to help you think strategically. But we can only do that when we have all the information early enough to make a difference. So here's my challenge to you. Before you take on that next big idea, stop for a moment. Ask yourself two questions. First, have I really maximized the business I already have? And second, have I talked to my CPA about what this new move really means for me financially and tax-wise? If you're running multiple small businesses and feeling stretched thin, maybe it's time to realign and refocus. Let's make this the year where your energy and your money start working smarter, not harder.
