One member was leaving millions a year on the table (his CPA had no idea)

A few weeks back I wrote about why I think world-class tax strategy is the single best investment I’ve ever made.

I got a lot of replies on that one. And the most common question was some version of… “okay, but what are the actual strategies? What am I probably missing right now?”

Fair question. So today I want to name four that come up constantly inside our community. Not in a generic “you should look into this” way. Specific levers, with specific reasons most CPAs miss them.

Quick caveat before I start. I’m a practitioner, not your tax advisor, and every one of these has to be evaluated against your specific situation by someone qualified. I’m sharing what I’ve seen work for the founders and post-exit operators in our community.

1. Accelerated Depreciation

This one is the most common miss I see.

Most real estate investors take standard depreciation, which spreads the write-off evenly over 27.5 or 39 years. That’s fine. It’s the default. And it leaves enormous money on the table.

Accelerated depreciation, done through a proper cost segregation study, lets you front-load a huge portion of that depreciation into the first few years of ownership. For a real estate investor with active income to offset, or for someone whose spouse qualifies as a real estate professional, the effect can be massive. We’re talking hundreds of thousands in tax savings on a single property in year one.

The reason most CPAs don’t do this is they’re not real-estate specialists. They file what you give them. They don’t run cost seg studies. They don’t even know to bring it up.

2. Solar (Inside the Right Window)

There are tax credit strategies tied to solar investments that can offset a meaningful amount of ordinary income. The credits, when structured correctly, are dollar-for-dollar against your tax bill, not just deductions against income.

I want to be careful here. There is a window where this makes sense, and there’s a window where it doesn’t, and the rules have shifted multiple times over the last few years. So this is not a “do this” recommendation. It’s a “find out if you’re in the window” recommendation. If you have a high ordinary income year coming up and you’ve never explored the solar credit space, that’s a conversation worth having with a real tax strategist before December.

3. Film Credit Strategies

This one almost nobody knows about, and it’s been around for years.

Certain film investments come with state and federal tax credits attached. The right structure can offset ordinary income, not just passive income, which is what makes it powerful for high-W2 earners and operating-business owners who don’t have a lot of real estate exposure.

It’s not for everyone. It requires real diligence on the operator and the structure. But for the right kind of taxpayer, in the right year, it can be one of the cleanest ways to bring an effective rate down.

The reason this almost never comes up with a normal CPA is that it lives in specialty tax planning, not compliance. You have to be working with someone who actively builds these strategies into the year, not someone who picks up your shoebox of receipts in February.

4. The UBI Formula

This is the one that made my jaw drop when I learned how common the mistake is.

There’s a formula your business uses to calculate how its income flows to you and your team for tax purposes. It involves how compensation is structured, how distributions are treated, and how the various pieces are categorized. Most CPAs use a default version of this formula. It’s not wrong, exactly. It’s just not optimized.

We have a member in our community who was running the wrong version of this calculation for years. His CPA had no idea. When our team brought in a tax strategist to look at it, the corrected formula was saving him several million dollars a year. Every year. That had been leaking out of his business for as long as he’d owned it.

I want to be honest about that number because it sounds like the kind of made-up statistic that gets thrown around in this space. It’s not. It’s one specific member, one specific business, and a real diagnosis of one specific formula error. I’m telling you about it not to suggest your number is anywhere near that. I’m telling you about it because if a sophisticated post-exit founder with a real CPA was losing that much, the chances that you’re losing something are very high.

The Thread

The pattern across all four is the same. They’re not secrets. They’re not loopholes. They’re written into the IRS tax code in plain English, and they exist because the government wants you to do specific things. Real estate. Energy. Domestic film. Employee compensation structured a certain way.

The reason you’re probably not using them is that your CPA’s job is compliance, and these are strategy. Two different jobs. Two different people, usually, doing them.

The tax code is roughly 70,000 pages. About 30% of it covers how W2 employees pay taxes. The other 70% is written for business owners and investors. That 70% is the playbook. Most entrepreneurs spend their whole career operating in the 30% column, because nobody ever showed them the rest.

Until next week,

Justin

P.S. If any of the four landed for you… if you’ve been wondering whether you’re using accelerated depreciation correctly, or whether your UBI formula has ever been audited by anyone other than your filing CPA… send me an email and let me know which one. I’m building a list for a future deep-dive and I want the next email on this topic to answer the actual question most of you are sitting with.