Hartford Business Journal

HARTFORDBUSINESS.COM | FEBRUARY 10, 2025 21 FOCUS | ACCOUNTING ACCOUNTING SERVICES INDUSTRY MERGER & ACQUISITION DEAL FLOW said the firm is open to further acqui- sitions here if the right opportunity presents itself. "We don't seek out acquisitions as a strategy for growth, but when opportunities come, if there's a benefit to our people and clients, we will always explore them," she said. Merger trend Nationwide, the accounting industry is in a "cycle of transition" as firms struggle with a shrinking labor pool and the need to invest in new tech- nology, such as artificial intelligence, to remain competitive, Belliveau noted. Those challenges continue to fuel consolidation, as smaller firms look to larger players to gain access to additional resources. According to an August 2024 report by Boston-based investment banking firm Capstone Partners, there were 70 merger-and-acquisition deals in the accounting services industry through the first half of last year. Activity in the sector peaked post-pandemic in 2023 with 160 deals. The national trend is playing out in EXPERT'S CORNER Tips to prepare for the 2024 tax filing season By Steven Maffiolini A s we leap forward into the 2024 tax filing season, both businesses and individuals must stay informed and be prepared. Here are some tips that can help you reduce your tax liability. Tips for businesses: Organize financial records Compile all records of income, including sales receipts, bank deposits, and any other revenue sources. Maintain detailed records of all business expenses, such as rent and utilities, payroll, office supplies, mileage and travel expenses and advertising. Consider depreciation Review any fixed assets acquired during the year. Think of equipment, furniture and vehicles for potential depreciation deductions. Depending on the type of asset, your business may be eligible for a full write-off. Book-to-tax differences If your financial records are on a book basis, be aware of potential temporary or permanent differences for your tax returns. Common differences include depreciation, accrued payroll and expenses, meals and entertainment expenses. State filings If your business operates across state borders, you might need to file and pay tax in more than just your home state. It's important to document the allocation of sales, payroll and fixed assets by jurisdiction. Deadlines and extensions Mark relevant dates on your calendar: March 17 is the tax dead- line for partnerships and S corpo- rations; April 15 is the deadline for individuals and C corporations. If you need more time to file your returns, you can file for a six-month extension. Note that an extension applies only to filing returns; payment of tax still must be made in full by the initial due date. If you cannot pay your taxes in full, explore your options for payment plans with the IRS to limit penalties and interest. Stay organized Maintain a well-organized filing system for your tax documents to simplify the process and be prepared for potential audits down the road. Communicate with your tax advisor early to understand timing and cover questions. Tips for individuals: Gather necessary documents A wise first step would be to compile as much relevant documentation as you can. This includes: • W-2 forms from your employer(s); • 1099 forms from your investment advisor(s); • K-1s from any flow-through investments; • Records of any other income or expenditures, such as rental proper- ties or contract work. A great reference point is last year. If things are similar, you may just need to gather the same documents you had in 2023. Try to think of anything new for this year: Did you open a CD? Is this the first year you withdrew from an IRA? Those are just a couple examples to get you thinking. Maximize deductions A big variable for many individ- uals is whether they will utilize the standard deduction, or itemize their deductions on Schedule A. The standard deduction ranges from $14,600 for single filers up to $29,200 for married taxpayers filing jointly. Some individuals, however, can benefit greatly from itemizing instead. There are several sources of item- ized deductions, including: Medical expenses (exceeding 7.5% of your adjusted gross income; property and state taxes paid ($10,000 maximum); charitable donations, mortgage interest, and casualty losses. If you believe the sum of these expenditures could exceed your standard deduction, it would be wise to consider itemizing. Although 2024 has passed, there are potential moves you can make to reduce your taxable income between now and the filing deadline. One option is to contribute up to $7,000 ($8,000 for those 50-plus) to a traditional IRA. Or, if you are enrolled in an eligible high-deduct- ible health insurance plan, you can contribute to a Health Savings Account (HSA) – between $4,150 and $9,300, depending on your age and filing status. Maximize credits Take advantage of the numerous available tax credits, including: • Higher-education credits; • Child and earned income tax credits; • Child and dependent care credit; • Residential energy and electric vehicle credits. Steven Maffiolini is a manager at accounting and consulting firm CLA. He is based in the firm's West Hartford office. Steven Maffiolini Connecticut, with several accounting firms announcing M&A plans over the last few years. Last year, national accounting firm Marcum LLP acquired Farming- ton-based Federman, Lally & Remis. Months later, Marcum itself was acquired in a $2.3 billion deal with financial services advisory giant CBIZ Inc. Other recent deals include the merger of Glastonbury firms Giamalis and Co. and MahoneySabol, as well as the 2023 link-up between CPA firm Fiondella, Milone and LaSaracina LLP, based in Glastonbury, and Bregman & Co., which has offices in Stamford and Avon. "The changing landscape across the professional services industry is challenging for everyone," said Belliveau. She said the merger with Burzenski will make it easier for both firms to focus on client outcomes and expanded services across their combined client base, which will "continue to provide opportunities for our people to do work that is meaningful to them." Belliveau said her No. 1 priority in the short-term has been to integrate the two teams and ensure a seamless transition for Burzenski's clients. As the firm begins to plan for fiscal year 2026, it will look for more opportunities to learn from and replicate some of Burzenski's practices. For instance, BerryDunn is inter- ested in Burzenski's expertise in dashboarding and benchmarking services, which help clients track their performance and measure their market competitiveness. "That's a really cool service they've been providing, and we've been doing some of that, but we want to expand," Belliveau said. "We clearly recognize that it's something that will benefit our clients and we know our employees will get excited about it." Note: There were 70 M&A deals between January and July in 2024. | Source: Capstone Advisors NO. OF M&A DEALS 175 150 125 2020 2021 2022 2023

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