Ep #29: Cook the Books Round Two with Restaurant Accountant Dan Engel

ptotah
12 minutes ago
2 min read

What does your restaurant’s bookkeeping say about its true value? Many owners load up their books with expenses to reduce taxes, but this can obscure the actual market value of the business, especially when it’s time to sell. In this episode, we welcome back restaurant accounting expert Dan Engel, who discusses the trade-off between tax savings and clean financial records.

Dan explains the risks of running personal expenses through the business, which can trigger IRS audits and affect profitability. We explore the trade-off between short-term tax savings and long-term business health, as well as what qualifies as a legitimate deduction versus personal expenses that can harm your business’s value. Dan also discusses add-backs, what lenders and brokers accept, and the importance of maintaining a clean balance sheet.

By the end of this episode, you’ll understand the real trade-offs between short-term tax benefits and long-term business opportunities. Whether you’re thinking about selling in the near future or just want to improve your financial management, maintaining clean books will ultimately help you secure better lease terms, qualify for loans, and maximize your business’s market value.

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What You’ll Learn from this Episode:

How to leverage clean books for better lease terms and loan qualifications.
How the IRS actually conducts restaurant audits and what triggers their attention.
The difference between legitimate business deductions and personal expenses that hurt valuation.
What specific add-backs brokers accept versus what SBA lenders will allow.
Why balance sheet errors compound over years and destroy business value.
How to decide between tax minimization and maintaining marketable financial records.
The real impact of running personal expenses through restaurant books on cost of goods calculations.