McGuire Sponsel, Ernst & Morris announce strategic merger

McGuire Sponsel identified an opportunity for a California-based plant that specializes in designing, manufacturing and installing farm equipment for different edible nut industries domestically and internationally. The S-Corporation had approximately $21.3 million in annual revenue, including about $6.5 million in international sales.

McGuire Sponsel identified a Tennessee-based hardwood manufacturer using the 4% of qualified export sales method to calculate its IC-DISC commission. The C Corporation had approximately $47 million in annual revenues, including $32 million in international sales.

McGuire Sponsel identified an opportunity for a Kentucky-based company that machines automotive and heavy truck parts. The LLC had approximately $5.5 million in annual revenue, including about $2.6 million in international sales.

An Interest Charge – Domestic International Sales Corporation “IC-DISC” provides a permanent tax savings opportunity for qualifying exporters.

This past December another federal Appellate court, the Court of Appeals for the Second Circuit, handed down one more victory for the Taxpayer. The court ruled in favor of the Berenson family and their Summa Holdings business, the cases in which federal Appeals Courts have been consistently reversing the Tax Court and the objectives of the IRS who have sought to limit the benefits of using IC-DISCs as shareholders of Roth IRAs.

This webinar will discuss the basis of an IC-DISC, what qualifies as an IC-DISC export

McGuire Sponsel has discussed the IC-DISCs year-end planning topics with clients in our webinars and news articles.

The February 2016 ruling in favor of the taxpayer by the U.S Court of Appeals in Summa Holdings, Inc. v. Commissioner has validated a new dimension in the use of the IC-DISC vehicle for long-term tax planning and wealth building. In summary, the Summa Holdings verdict allows the use of Roth IRAs to accumulate IC-DISC dividends without limitation after those dividends are received by a Roth IRA on an after-tax basis.

For exporting companies, this is the perfect time to examine whether or not it would be beneficial to establish an Interest Charge – Domestic International Sales Corporation (IC-DISC).

Press Release

FOR IMMEDIATE RELEASE                                                                                       

May 1, 2019

McGuire Sponsel, Ernst & Morris announce strategic merger

Partnership combines technical expertise, commitment to meaningful client collaboration

INDIANAPOLIS McGuire Sponsel, a specialty tax and consulting firm with clients throughout the United States, announced today a strategic merger with Ernst & Morris, an industry leader known for its significant cost segregation expertise. Cost segregation is the process of identifying property assets in order to optimize depreciation deductions for federal tax purposes.

Firm leaders say the merged entity – which will move forward as McGuire Sponsel – was piloted by choice and a mutual opportunity to offer additional benefits to clients.

“Ernst & Morris is an ideal partner who will bring incredible value to our clients,” said TJ Sponsel, co-founder and managing shareholder of Indianapolis-based McGuire Sponsel. “Beyond the combination of significant cost segregation expertise, we share important core values and the foundational belief that successful relationships are built on trust and integrity. We also share a commitment to serving clients with an unmatched passion for this business, focused on clients and meaningful collaboration.”

Working as an extension of clients, primarily CPA firms, McGuire Sponsel offers practices that fall outside traditional CPA firm services. In addition to cost segregation, the firm provides derivatives and debt advisory, IC-DISC, research and development tax credit studies, nonprofit advisory services and advisory on economic incentives.

Located in Marietta, Ga., just outside of Atlanta, Ernst & Morris is one of the nation’s oldest and largest firms dedicated to cost segregation studies. The firm, founded in 1993, operates in all 50 states – for both CPA firms and property owners.

“Merging with McGuire Sponsel provides tremendous opportunity for our clients, beginning with access to additional practices and a seasoned research and development practice to complement our work in cost segregation,” said Alan Smith, managing director at Ernst & Morris. “With enhanced solutions our firm is better positioned to help clients and partner CPA firms maximize savings.”

Industry veterans and CPA firms around the country are sure to take notice. Gary Shamis, founder and managing partner of SS&G where Gary grew a start up to 37th largest firm in US before combining with BDO, says the news represents an opportunity for both firms and the clients they serve. “This is a substantial combination of industry forces,” said Shamis, who is now CEO of Cleveland-based Winding River Consulting. “McGuire Sponsel has quickly developed a national reputation for high-level advisory work, and Dave McGuire is a leading industry expert. Ernst & Morris is an industry pioneer and considered to be one of the top cost segregation boutique firms in the country. It’s a sizeable concentration of technical expertise, proven track records and client-focused service.”

Terms of the private deal were not disclosed.


About McGuire Sponsel

Partnering with local and regional CPA firms, McGuire Sponsel offers cost segregation, R&D tax credits, cost segregation, IC-DISC, and Credits & Incentives. . McGuire Sponsel strengthens client relationships by offering a conservative, methodical approach to delivering tax practices that fall outside the traditional practices of local and regional CPA firms. Our approach has allowed us to become a trusted resource to CPAs across the country, with a strong track record with the IRS.