Jeremy Wells, EA, CPA, 99 King Street Unit 592, Saint Augustine, FL (2026)

07/22/2026

🏢 Why do buyers push for asset sales instead of stock sales?

Two words: stepped-up basis. Fresh depreciation + leaving liabilities behind can make a huge difference.

In this article, I explain

- Why buyers push for asset sales (stepped-up basis and leaving liabilities behind) and why sellers often resist
- How the residual method allocates purchase price across all seven asset classes, from cash to goodwill
- Why goodwill is often the most valuable—and most misunderstood—asset in a service business sale, including the personal vs. corporate goodwill distinction from Martin Ice Cream Company v. Commissioner.

I also share where I draw the line as a practitioner: I won't prepare a return without a properly documented allocation both parties have agreed to. No exceptions.

If you work with clients on business sales, this one's worth your time:

Link in comments ⤵️

07/22/2026

Most S corporation errors I see in practice don't come from complex transactions. They come from treating three very different ledgers as if they're the same number.

In this episode of Tax in Action, I break down the three key measures every S corporation practitioner needs to understand: retained earnings, the Accumulated Adjustments Account (AAA), and shareholder stock basis. Each one answers a different question, and confusing them can lead to real problems for your clients.

Here's what we cover:

- Why retained earnings, AAA, and stock basis can — and often should — show different amounts, and what drives those differences
- How AAA governs whether a distribution comes from S corporation earnings or taxable C corporation earnings and profits
- Why AAA alone tells you nothing about whether a distribution is taxable to a specific shareholder
- The order-of-operations rules for calculating stock basis under IRC 1367 and the related regulations
- Form 7203 and why it matters whether you're preparing the 1120-S, the 1040, or both
- What's really happening when distributions in excess of basis get misclassified as shareholder loans and why that approach doesn't hold up

Link in comments ⤵️

07/20/2026

📢 CE available! 🚨

Statutory Workers and Misclassification Relief

In this course, I break down federal employment tax rules governing worker classification, helping you correctly identify statutory employees, statutory non-employees, and dual-status workers under the Internal Revenue Code.

Practitioners will gain working knowledge of misclassification relief provisions, including IRC §§3509 and 6521, Section 530 of the Revenue Act of 1978, Form 8919, and the Form SS-8 determination process.

I draw on real-world client scenarios to illustrate classification rules and their compliance consequences, helping professionals advise employers and workers with greater confidence and precision.

Link in comments ⤵️

07/20/2026

💡 Business owner? Side hustler? Contractor? You might qualify for one of the most misunderstood tax breaks in the entire tax code: the Qualified Business Income Deduction (QBID).

I recently shared some thoughts with Bankrate about how this deduction works. Here’s what you should know in plain English:

✅ Who benefits most?
Owners of businesses that report income on their personal tax return: sole proprietors, partnerships, and S corporations.

✅ Do you lose it if you make “too much”?
Possibly. This deduction has income phaseouts that can reduce or wipe it out entirely. The more your taxable income grows, the more careful you need to be.

✅ What about certain professions?
Certain fields (law, accounting, consulting, medical, etc.) can be limited more quickly than others. But even if you don’t fall under those “specified service” rules, phaseouts still matter.

✅ It’s not always DIY-friendly.
The QBI is famous for complicated calculations. If you’re a small business owner, don’t assume TurboTax has your back. Sometimes a quick consult can save you thousands.

💡 Key takeaway:
The QBI isn’t automatic. It’s strategic.
Know the thresholds. Run the numbers. And don’t leave it on the table.

📰 Here’s the article where I break this down: https://www.bankrate.com/taxes/qualified-business-income-deduction-what-it-is-and-how-to-claim-it/

07/18/2026

🧪 Your firm isn’t an Excel template. It’s a lab.

One of the best shifts I made as a firm owner was stopping the perfection mindset and embracing experimentation.

On a recent Accountant Roundtable episode, we dug into:
✅ Why “experiment” is the mindset that prevents overwhelm
✅ Building delegate-ready SOPs using Loom, Scribe, and Text Blaze
✅ The tech ecosystem > tech stack mindset for tools like Ignition, Carbon, QBO, ProConnect
✅ Why change management shouldn’t happen in March (no matter how shiny that new app looks)
✅ How full-service bookkeeping + tax became our model after seeing clients never do their own books

But experimenting doesn’t mean chaos. It means
• Testing a new app on one client
• Piloting a new pricing model in a micro-firm
• Recording your own screen while working so future team members aren’t guessing

These micro-experiments compound into macro-results.

📽️ Watch here: https://www.youtube.com/watch?v=StWoFQqR8-I

07/17/2026

The word "employee" seems simple enough until you realize it doesn't have one definition. It has many.

In a recent episode of Tax in Action, I broke down something that trips up a lot of employers and workers: the meaning of "employee" is contextual. It changes depending on which part of the law you're looking at.

For example, the definition used for labor protections like minimum wage and overtime is different from the one used for retirement contributions under ERISA. And both of those are different from the definition used in federal tax law.

That matters a lot in practice. If you're looking at a court case where worker classification was the central issue, the outcome can hinge entirely on which legal framework applies, because different parts of the law draw on different definitions, and different court precedents have developed around each one.

In this episode, I focused specifically on what "employee" means under the Internal Revenue Code, especially Subtitle C, which covers employment taxes: F**A (Social Security and Medicare), FUTA (unemployment tax), and federal income tax withholding.

This is part one of a two-part series on worker classification and misclassification. I walk through the common law control standard and the three categories of evidence the IRS actually uses when evaluating a working relationship.

If you're an employer or you work with employers, this is worth understanding. Getting classification wrong has real consequences for both sides.

Link in comments ⤵️

07/15/2026

🖖 Star Trek teaches better client management than most business books

Growing up, I’d watch Star Trek: The Next Generation every night. Picard, Riker, and Data felt like colleagues before I even had a job. Years later, I realized those episodes were quietly prepping me for real-life client work:

• Navigating “first contact” with prospects
• Balancing logic with humanity
• Negotiating without phasers

We often think our hobbies and interests are “just personal,” but they’re quietly shaping how we show up in our work.

In this episode of "What's Your And?" with John Garrett, we explored:
🚀 How sci-fi teaches real negotiation skills
🚀 Why technical expertise isn’t enough to build trust
🚀 Lessons on leadership and client empathy from a Vulcan

🎧 If you want a light but thoughtful listen for your walk today, listen here: https://whatsyourand.com/episode-209-jeremy-wells/

Live long and prospect.

07/15/2026

One of the main reasons to run a business or make an investment is to make a profit. At least that's the way a lot of people think. But what happens when your business consistently loses money? Does that mean you're just pursuing a hobby?

I recently explored this question on the Tax in Action podcast through the fascinating case of artist Susan Crile, who successfully defended her art business against IRS claims despite reporting losses in nearly all of 25 years.

Businesses hit rough patches. Some businesses take a while after they start up to reach profitability. Amazon famously took about seven or eight years before it started turning a profit. And even then it was a very modest profit for a couple years until it really grew to become one of the world's largest and most profitable companies that it is today.

But for small business owners and individual taxpayers, there might be activities where it's not clear whether that activity really ever has a shot at becoming profitable. Business losses are generally deductible for tax purposes, but only if that activity is engaged in for profit.

This brings us to the hobby loss rule. The IRS and courts have had to answer this question in a lot of cases: How do we know if there's a real profit motive behind an activity?

The Susan Crile case from about 10 years ago is particularly instructive. While it's not really that precedential, if you are a fan of looking at the tax court and the cases and the way tax court judges think and interpret tax law, I think this can be a really good opinion to read through.

What makes this case so compelling is that it shows how professional conduct, record-keeping, and business decisions matter more than consistent profitability when defending your business against hobby loss claims. The court uses a nine-factor test to determine whether an activity has a genuine profit motive.

For practitioners working with creative professionals, startups, or any clients going through extended periods without turning a profit, understanding this rule is crucial. Sometimes the path to profitability is longer than expected, but that doesn't mean you're not running a legitimate business.

🎧 Check out the full episode for a deep dive into all nine factors and how Susan Crile successfully defended her art business. Link in comments ⤵️

07/13/2026

When disaster strikes and you receive an insurance payout, your tax issues might just be beginning. In the final episode of a three-part series on losses, I dive deep into IRC §1033 and involuntary conversions. I cover the critical tax rules that kick in when clients need to replace property lost to casualty, theft, or government condemnation.

This episode covers the essential decision every client faces:
💵 Recognize the gain immediately. or
🗓️ Defer it by purchasing a qualifying replacement property within specific timeframes.

I break down the "similar use" requirements that can make or break a deferral election, explain why replacement periods range from two to four years depending on property type, and show how basis calculations work to help clients avoid unexpected tax bills when they're forced to start over.

Whether you're dealing with hurricane damage, eminent domain, or theft losses, understanding §1033 can save your clients thousands in taxes during some of their most challenging moments.

Link in comments ⤵️

07/13/2026

Changing careers and transitioning to self-employment can be difficult challenges.

🎙️ On The Unique CPA Podcast, I chat about my transition from academia to accounting and from employment to firm ownership. Thankfully, I had great mentorship throughout the process.

🎧 Listen to my story on The Unique CPA: https://tri-merit.com/podcast/carving-your-own-path/

Jeremy Wells, EA, CPA

07/22/2026

07/22/2026

07/20/2026

07/20/2026

07/18/2026

07/17/2026

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