Business Innovators Radio - Interview with Scott Blackley Founder, Trucess Tax Advisory Discussing Get The Entity Structure and Owner Pay Right

Episode Date: October 14, 2026

Scott Blackley, CFP®, EA, ABFP®, APMA®, AWMA®, CRPC®, LUTCF® Founder, Trucess Tax Advisory LLCScott Blackley is the founder of Trucess Tax Advisory LLC, a proactive tax planning and advisory firm built for successful business owners, high-income professionals, and affluent families who want more than a tax return filed on time—they want a strategy designed to reduce their lifetime tax burden and help them keep more of the wealth they’re building.Scott’s perspective on tax strategy comes from a background that extends well beyond tax preparation. As both a CERTIFIED FINANCIAL PLANNER™ professional and an Enrolled Agent, he works at the intersection of tax planning, financial planning, retirement, investments, and wealth management. His advanced training is reflected in his ABFP®, APMA®, AWMA®, CFP®, CRPC®, EA, and LUTCF® designations.He founded Trucess Tax Advisory on a simple premise: tax planning has to happen before the return is filed—not after the opportunities to act are gone.Traditional tax preparation looks backward, reporting what has already happened. Trucess works the other direction. Scott and his team evaluate a client’s full financial and tax picture proactively, looking for inefficiencies, missed opportunities, and strategies that may never have been considered.Depending on the client’s circumstances, that analysis can span business and entity structure, retirement plans, real estate and cost segregation, income and deduction planning, Roth conversions, charitable strategies, investment taxation, and other advanced planning opportunities.But Scott believes a strategy should never be implemented simply because it creates a tax deduction. It has to make financial sense first.Every recommendation should have a clear purpose, a measurable potential benefit, and a place within the client’s larger financial plan. Scott believes clients deserve to understand not just what they’re doing, but why they’re doing it and what the strategy could actually mean for their financial future.That philosophy shapes how Trucess operates. Every engagement begins with an evaluation of the client’s current position to identify meaningful planning opportunities. If Trucess doesn’t identify a solution, there is no cost for the initial evaluation.For Scott, tax planning isn’t about chasing loopholes or simply lowering this year’s tax bill. It’s about coordinating taxes with the decisions that build, protect, and ultimately transfer wealth—and looking several moves ahead.Learn more: https://trucesstax.com/Investment Advisory Services are offered through Rossby Financial, LLC, a Registered Investment Adviser. Rossby Financial, LLC and Trucess are not affiliated.Securities transactions cannot be conducted via email or voice messages. Any related requests, or requests for distributions, must be confirmed live with the client.Rossby Financial, LLC does not offer tax or legal advice.This email transmission and any documents, files or previous email messages attached to it may contain information that is confidential or legally privileged. If you are not the intended recipient, you are hereby notified that you must not read this transmission and that any disclosure, copying, printing, distribution, or any action or omission of this transmission is strictly prohibited. If you have received this transmission in error, please immediately notify the sender or return and delete the original transmission and its attachments without reading or saving in any manner.Influential Entrepreneurs with Mike Saundershttps://businessinnovatorsradio.com/influential-entrepreneurs-with-mike-saunders/Source: https://businessinnovatorsradio.com/interview-with-scott-blackley-founder-trucess-tax-advisory-discussing-get-the-entity-structure-and-owner-pay-right

Welcome to influential entrepreneurs, bringing you interviews with elite business leaders and experts, sharing tips and strategies for elevating your business to the next level. Here's your host, Mike Saunders. Hello and welcome to this episode of Influential Entrepreneurs. This is Mike Saunders, the authority positioning coach. Today we have back with Scott Blackley, who's the founder of Trucest Tax Advisory, and we'll be talking about getting the business entity structure. and owner pay right. Scott, welcome back to the program.

Great. It's great to be back, Mike, and thanks for having me. And it's always a pleasure visiting with you. Yeah, this is really neat just talking through your methodology of the before method.

And we're on the F, the foundation. And it just is so, the word picture is so powerful to me because, boy, if you build your house on sand, that house is going to tumble. If you build your house on a rock, it's going to be solid.

So when you get that business foundation, right, that's where you really know you've got a solid deal. So what has to be right in the business structure before any tax strategy can be done? Well, you know, the F that we're talking about today stands for foundation. So you've got to get the entity structure and the owner pay, right? And so when we're looking at it, I'd say if the entity, the owner compensation, and the books are wrong, the best-looking strategy can fall apart. And so the entity needs to fit the business, the owners need to be paid correctly,

and the books need to be reliable. If any of those are wrong, the clever strategy on top can fail. I also want the business and personal spending separated and documented a reinvesting, process for legitimate expenses. Foundation isn't glamorous, but it protects everything else we're trying to accomplish here. So the entity needs to be, needs to fit the business. The owner needs to be paid correctly and the books need to be reliable is what I'd say. You know, and I know that we, you know, we probably can take a whole long weekend seminar on all of these things. So we want to just hit it at a high level. But, you know, you think about SoulProp and LLC and SQ

Corp and C corp and all of these kind of things. You can drive yourself nuts Googling around online to go, oh, let's just do Corporating Delaware. I heard that's a pretty good deal. What are some of the things that you're finding that business owners need to understand when making that entity choice that might have made sense years ago or what they saw online, but now no longer is a fit? You review when it profits the ownership, staffing, or plans change.

An S-Corp might not justify its administrative cost at a modest profit. Yet it becomes useful when the earnings are consistently well above reasonable owner compensation. The reversal can also happen when we can compare the actual economic. payroll, maybe even the legal needs, the state rules, and in a future exit strategy, not just what a friend said worked for them. So it's kind of what you talked about, right? You're talking to your friends and your buddies or you're getting on there. And oh, Delaware sounds great.

Well, does it? Maybe it sounds great for somebody that just hopping on and doesn't know what they're doing or have any advice. Or maybe that's what the Internet said to do, right? So you review when the profits, ownership, and staffing, or plans change. And doesn't that mean that you need to do more than just dropping off a shoebox full of receipts and papers to your accountant once a year and going, let me know how much I owe and getting back to kind of what we've been talking about in this series, which is having that proactive consultative approach. and maybe you're going to meet every three to four months, but minimum twice a year, to go, okay, what's changed? And then someone like yourself is listening for things like, oh, well, we've done this.

And you're thinking, okay, well, we need to check on that, right? So it means that there needs to be those regular checkups throughout the year to make sure everything is baked in well. Yeah, and Mike, let's be fair. Please do not bring me a big box of receipts. there's cheaper ways to do that people and you know you get paid you know for for what you're worth and there's easier cheaper better ways to do a box of receipts than bringing it to your accountant right and if he doesn't tell you that then that's probably he probably still has wood paneling on her

on his office yeah there's definitely wood peddling and it hasn't been changed out in a while and The sofa looks like it's rose-colored and brown, right? Like the old 80 style. So, you know, there's a lot of, there's a lot to do that. And it's important for people to see and know. But when we're talking about different things, you know, one thing that we can get into is, and I brought it up in your last question, but the reasonable compensation, right? And why does the IRS care about it?

And I would say for S corporations, the owner who works in the business, the wages need to be reasonable for the services that are performed. And that's kind of where we go back to your value. What are you making? Should it be an S corb? The IRS doesn't want owners avoiding employment taxes by calling their earnings distributions. So we look at the duties, the time, the experience, maybe what the market's paying, the business is. circumstances and we do a document analysis and it's not a magic, you know, percentage of the profits.

It's a hypothetical case. You know, we've talked about cases in the past. And, you know, one case is where a guy should have been making probably closer to $18,000,000 and the business owner comes in and, well, my current tax advisor or CPA told me that I should be doing 60,000. I said, okay, that's fair. So how did he come up with that number? And the gentleman's answer was, well, we haven't talked about it in a really long time, but when I set up my business 12 years ago, that's what it should have. Yeah. Wow. So think about that for a minute. Has your business grown in 12 years? And if your business hasn't grown in 12 years, I hope it's because you didn't want it to, right?

because we're all trying to grow and do better and add more value. And so it's very important that as your business grows, so does your planning, your strategy, your taxes, your processes. And we want to make sure that what started or what got you to this point isn't what we're moving forward with. We're moving forward with the best strategy for where you are now and where your needs are in the future so that the IRS doesn't come knocking and that we can get you to where you need to be. Legal, ethically, right, and on time.

So that client, the scenario that you mentioned, what if you said, okay, well, we need to get it up, you know, more than what you're paying, but, you know, whatever that number ends up to be, can it ever get to the point where paying the owner more could help reduce the tax bill or is it always, we're paying you more, you got to pay more employment taxes, and that's, you ever get to the owner. just the way that it is? I think the answer is it depends, right? So sometimes, right? So people always, you know, always want you to, if you're at a baseball game or somebody always wants that, that free advice, right? And the answer I give people is it's highly unprofessional to give financial or tax advice without seeing somebody's whole picture. And usually when somebody says, well, Scott, so-and-so told me the other day that I should do that. And I said, said, like I said, do they have your whole picture? He said, no. I said, well, like I said, it's highly unprofessional for somebody to give you advice financially or with tax without

known your whole picture because all they're doing is throwing it against the law to hope to get a transactional sell from you, if anything else. But there's there are some things that kind of open up when the owner makes more money. And the thing and again, you're the professor. I'm just speaking of in my personal experience. I know that. for me that there is a benefit to having my business contribute to my personal 401K, because then there's some type of a business benefit of reducing something, and I know that that's tied to the percentage of the salary that I'm paid. So in that scenario, if you are paying yourself more salary,

then more can go over into that 401K. And so those are some of those benefits that way, right? Yeah, potentially. It's a trade-off. It's not a blanket rule. So higher W-2s can pay generally, and you increase the payroll taxes, right, which can reduce qualified business income. And at the same time, those wages can support retirement plan contributions and other benefits. But we model the wages and plan design by, you know, the QBI deductions and qualified business income and payroll taxes together. First, the salary has to be reasonable. We don't pick in artificially low or high number just because in an engineering tax result, right? So potentially, the answer is, but it's a tradeoff and not a blanket rule. So if we pay somebody higher income and we can put more money back or even if we get into something as crazy as all in gas investing, and not that that's crazy. But now that we're using after tax to write it off, maybe we're getting 70% right off for what we just invested.

And maybe it's better to do it outside of the business with our own out-of-pocket money than it is to do it inside the business. And so we're just looking for what's best for the person in front of us now and where they want to see theirself or where they want to go. So what's an accountable plan? So when we're looking at different subjects and like setting up things for accountable plans per se, right? So how much do you know or have you ever been talked to about an accountable plan? For me personally, I would say never. I don't know what it is. You know, what's funny is a lot of people don't have a lot to know about an accountability plan.

So you can look at it in the IRS. It's kind of a compliant arrangement. And what it does is it allows a business to reimburse employees, including NAS corporations, owner employees for legitimate business expenses that they paid personally. So when it's properly structured and administered, the reimbursements are generally tax deductible to the business, tax free to the employee or owner employee, and not subject to federal payroll taxes. And that's going to exclude from what the employer.

employees W-2 wages see or do. So, but there are, I'm not going to get too deep into this, but there are three IRS requirements when we're looking at that and it's all done under the Treasury Regulation 1.62-2. The accountable plan must satisfy basically three things. Business connection, so expenses must have a legitimate business purpose, substantiation, so employees must adequately. document expenses within a reasonable period and return of excess. So employees must return reimbursements or advances that exceed the expenses within a reasonable

period. And so there are S provided safe harboring timelines and rules and all that stuff, 60 days, and return excess and advances of 120. But that's other stuff that we don't get into here. But yes, to answer your question, it does help. and there are things that we can do to put us in a better place. So you asked me what I know about it, and I said nothing. So it makes me think, why don't business owners have one or know about them?

So I'm going to tell you something that I tell a lot of people. And I think this sums up life and it sums up all businesses, right? So when somebody tells me, hey, Scott, why didn't my CPA tell me this? Or Scott, why didn't my enrolled agent? or why didn't my tax professional? Well, it's two reasons. One, they didn't know or two, they didn't want you to know, and neither one of those are good, Mike. Yeah.

Yeah. That's a great point. Drop the mic right there. All right. So that's all we got for today, Mike. Yeah, really. Have a nice day. Thanks.

Yeah, that's a great point. Yeah. Hey, so, you know, we're talking about kind of the foundation and the entity structure. And again, we could get into a, you know, two-week long. a business class on which one to pick and all of that. But the point is, why might a business belong in a different entity or a building? And it makes me think of this too. You know, like you've said, you know, oh, I set that up 12 years ago.

It didn't change it. Are there some things that are hard and fast that should never change? So what if a business goes, oh, well, you should be in a S corp. And you, Scott, would say, yep, I agree. would the time ever come that down the road the business should change like could you start off as an LLC but then when certain things happen maybe you should consider changing to something different yeah i mean so it all depends right so um why would so let's just take a why would a building uh belong in a different entity from the business that it uses today right so if we were to separating real estate from an operating company, it can help isolate like certain business risk and create flexibility for financing succession and future sell. But a separate LLC isn't automatically and it does automatically make rent or depreciation tax free. We need the attorney

and the CPA or Hoover is doing the advice to evaluate the lease, the financing insurance, ownership, self-rental, then the real estate decisions should be made for business sense without the tax business or the tax benefit first. And yeah, there are plenty of businesses where we start out at sole proprietor. And then we next step is maybe we're doing an S-Corp, right? Maybe some things have changed. They've got good income coming in. So we do an S-corp and we're paying ourselves.

And then, you know what? One day, we've gotten big and we need to be a C-Corp. And so as people grow and we're reviewing their tax situation, we look at that pretty much annually, Mike, just to make sure that we're in the best place moving forward for their growth and where they're at and where they plan on going. And then we can put that and say, hey, maybe this year we're out, but let's look at it every year. But probably two or three years out is probably where we're going to be when we need to move that. And then we'll file the proper paperwork to get that done directly for you. You know, I think that you hinted at something and the word complexity jumped into my mind, which is, if we can get something done in three steps, why do we need 23 steps? Let's keep it simple. Let's keep it smooth. But you think about some businesses out there. And you have said in our conversation, you're a perfect example of this. Your financial planning wealth firm noticed a need and now you started a tax planning strategy firm. There's businesses like HVAC that might say, oh, you know what? We're going to, We're doing so much work and we notice that there's handi man needs.

We're going to start a handyman company. What happens when an owner notices, you know what, I'm going to start a different company to complement our main company. Could there be a time where you're setting up an S corp and an LLC and a C, all of these things? And maybe the next entity is set up a different way than the main one. But yet they're building upon each other, right? How do you do that without creating complexity and starting more problems? I think when we're looking at it, you want to, if you can't explain something very simply, you probably don't understand it yourself, right?

Yep. And so when we sit down with people, we want them to understand that we're doing the business structure or the LLCs or the S-Corps or whatever we're looking at and how we're adding it on. We're not doing it because it sounds sexy and we want it to be complex. Yeah. We're doing it to be, to give the best outcome. that that person's looking for, right?

And so maybe we have a business that's been a sole proprietor LLC, and maybe they do want to start that new business, that HV8 company. Now they want to start the handyman service. Well, maybe it's time that they're making enough money that maybe that LLC for that HVAC company, well, maybe now it's an S-Corp. And maybe that S-Corp just started another LLC that's a sole proprietor, right, for what, for the handyman service. And now that handyman service is going to have some losses that first year.

So maybe it's a pass-through to the new, to the new LLCS Corp that they have with the H-BAC company. And so everything that we structure, it needs to be structured for a reason, not just for a cost or cost savings. And when a change needs to be made, it's not that the original decision or setup was wrong. It's just that circumstances change. Like in our example here, oh, you decided to explain. band and, you know, start a new business or buy a business. So now what we need to do is. And like we've said so many times, you can't just go out and Google or ask artificial

intelligence, what should I do here? You need to have someone that's got their fingers in, in all of this and seeing how all of the dominoes could topple in a positive way or a negative way. And I think that that's so huge. So when we're talking about foundation here, getting that entity structure and owners pay right, you got to get it right. now, but then as you're going every six months or so and having your checkups and at the end of the year, seeing how things panned out, what if something did change? Well, now you're making the

decision based on the information you have at that point. Right. And, you know, where you start is where you start and where you finish is where you finish. And all along the way we're trying to grow. And, you know, sometimes the people you start with in business, whether it's your employees or what have you, you outgrow them, right? And sometimes you don't. And sometimes, they grow with you. And then sometimes you've got to put them on a different seat on the bus so that you can get to where you need to go. And you're also not the same person that you were when you started the business, Mike. And so I think it's important that people realize that at some point, you know, we start these businesses and we're entrepreneurs and we work and it's just

us. And we're struggling and maybe the spouse knows. Maybe the spouse doesn't know. Maybe she's in it with it. Maybe he or she's in it with us, right? Maybe we're all doing it together. But what happens is at some point as a business owner, if you ever want to get out of the business, you have to quit working in it as a technician and you have to start working on it. And you can only do that by putting the right people in place, have the right foundation, so that when you do step out and you say, hey, I'm going to spend my time growing this business instead of spending my time working in this business. And you make that decision, that's when things open up, time opens up, better strategies,

better planning and, you know, LLC's corpse and what we're moving forward with all comes together so that we can get you out of that and so that you can be spending the time that you want to with your life and family, right? And we could go on for about four hours on that one statement there, but the thing that jumps out to me is this. When you get to that point and you start putting processes in place to make sure that this happens and that happens and you're stepping back to working four days a week and maybe you're headed toward an exit kind of a strategy down.

the road. You need to make sure of many things, but one thing that I'm thinking of, you can't do it all yourself. You need to rely on professionals that, you know, like yourself, to go, hey, what is my entity structure now, later, what do I need to look at? Oh, my legal side of things. Do I need a trust? Do I need, who knows what all that could bring up? But knowing that you put together a team so that you then don't have to become the expert about everything, because that's just a recipe for disaster. Yeah, I think the good example is take any business, right? Let's just say that we've been using HVAC, but let's just say you have an engineering firm, right? Maybe you're an architect firm, maybe you're building houses, right?

And I'm a financial guy, tax guy. I'm good with numbers. Engineers are good with numbers. So I had a firm, an architect firm, an owner come in here and we're talking. and, you know, and that's another thing, you know, there's do it yourself or there's people that just want all the information that go do it yourself. And then we have collaborators, people that, you know, want to collaborate with you until they can trust you.

And maybe a collaborator is a very smart person, but just never made anybody they could trust, right? And so, and then we have the delegator, somebody that just wants to hand it off, right? And so this person was probably more of a collaborator, do-it-your-it-your-selfer, right? They're a collaborator, but they've never met anybody they could trust enough to hand everything. over, right? And so my comment was, is what's, what are you building right now? Like, what's your biggest project right now that's got most of your time? And they tell me what they were building. And I said, okay, because they were given, you know, they were looking at taxes and telling me what their neighbor did and everything else. And I said, so right now, if I walked into your

office, would you let me do those drawings? Would you let me build that? I'm good with numbers. Yeah. I don't think I'm an idiot. You know, maybe I'm a smart dude, right? And she said, no, I'd never let you do because you don't have the training. And I said, what if you gave me six months to learn it and hop on there and do that? And she said, well, probably not. And I said, well, then how are you going to learn what we do in six months or from the internet? And you want us to give you the outcomes and be as professional as you are when you build your houses. Wow. Mike drop moment right there too. Yeah, for real. Yeah. Yeah. So trust the team you put around you. Trust but verify. Obviously, you know, if you see someone that looks good, verify, make sure that everything just feels right is right,

but make sure that that foundation is put into place. This has been super powerful, Scott. So if this is something that someone is interested in having maybe a second opinion in their entity structure, what's the best way that they can reach out and connect with you and your team? Yeah, so usually we like to have a meeting with somebody, but the easiest way is to upload or bring two or three of your last tax shares, both business professionals, some of your statements. You can find us at TrucessTax.com,

T-R-U-C-E-S-T-A-X.com. And if they want to just bring on their personal, if they just want us to look at their taxes and do their strategy, or if you'd like to become a partner with us, a referral partner, we have a setup for that. If you're in the tax world

and you just want somebody to do your planning, we'll sign a non-compete with that so that you can keep your taxes. If you're a financial person and you just never met a tax advisor that you could work with that was on the same page. We have that background

and we'll sign the no-compete for the financial side. So truceats,tax.com, Mike, and that'll help get you started. Scott, thank you so much for coming back on. It's been a real pleasure again. Great. Thanks for having us. You've been listening to Influential Entrepreneurs with Mike Saunders. To learn more about the resources mentioned on today's show

or listen to past episodes, visit www. www.Influential entrepreneursradio.com.