Who We Serve · FinTech & Startups
Startup finance that holds up in diligence.
Venture-backed and bootstrapped C corporations make their largest tax decisions early — when stock is issued, when engineers are hired, when the first payment or loan runs through the platform. Our Tax Advisory and CFO Advisory practices work those decisions together, so the cap table, the R&D file and the monthly close tell investors, auditors and the IRS the same story.
- Venture-backed Delaware C corporations
- Bootstrapped software companies
- Payments and embedded-finance platforms
- Online and marketplace lenders
- Wealthtech and insurtech platforms
- Founders and early employees holding equity
The financial shape of the business
Three things make startup finance different.
Most of the value in a startup's tax picture is decided at formation, at each financing and in how product work is recorded — years before there is taxable income to report.
01
Equity is the largest tax asset.
Founders, employees and early investors can exclude gain on qualified small business stock under §1202 only if the corporation and the stock meet the tests at issuance and through the holding period. The records made on the issue date — gross assets, active-business use, original-issue status — are what an acquirer's diligence team asks for years later.
02
Engineering spend is a tax decision.
Software development is a research or experimental expenditure by statute (§174A(d)(3)). Whether it is deducted now, amortized over 15 years because the work happens offshore, or turned into a payroll tax credit depends on how payroll, contractors and projects are tracked from the first hire.
03
FinTech money moves through you.
Payment flows, interchange, sponsor-bank fees and loan books raise questions an ordinary software company never faces: gross or net revenue under ASC 606's principal-versus-agent guidance, the tax timing of credit losses, and whether selling loans makes the company a dealer in securities. Errors here distort both the P&L investors see and the return the IRS sees.
Tax Advisory
The provisions that move startup outcomes.
Each item reflects current law after P.L. 119-21, enacted July 4, 2025, and IRS guidance issued through October 2026.
- QSBS: tiered exclusion for post–July 4, 2025 stockFor stock acquired after July 4, 2025, §1202 excludes 50% of gain after three years, 75% after four and 100% after five. The per-issuer cap is the greater of $15 million or 10× basis, and the corporation's aggregate gross assets can't exceed $75 million at issuance; both dollar amounts are indexed for tax years beginning after 2026. Stock acquired earlier keeps the prior rules — a holding period of more than five years, a $10 million cap and a $50 million assets test.1
- QSBS and the FinTech business-model question§1202(e)(3) excludes banking, insurance, financing, leasing and investing businesses, along with financial services and brokerage. A company selling software to lenders sits differently from one lending off its own balance sheet. We map revenue lines and assets against the 80% active-business test (§1202(e)(1)) before a priced round, while restructuring is still inexpensive.1
- §174A: domestic R&E is deductible againFor tax years beginning after 2024, domestic research and experimental costs — software development included — are deductible when paid or incurred (§174A). Research performed outside the U.S. stays on 15-year amortization (§174). Unamortized 2022–2024 domestic costs could be deducted in full on the 2025 return or split over 2025 and 2026; the small-business election to amend 2022–2024 returns closed July 6, 2026.5,6,7
- R&D credit and the §280C coordination ruleThe §41 credit now reduces the §174A deduction dollar for dollar unless the company elects a reduced credit on a timely filed return (§280C(c)). Section G of Form 6765 — business-component detail — becomes mandatory for tax year 2026, with exceptions for qualified small businesses taking the payroll offset and for taxpayers with $1.5 million or less of qualified research expenses and $50 million or less of gross receipts.8,9
- Payroll-tax offset for pre-revenue companiesA qualified small business — under $5 million of gross receipts for the year and no gross receipts before the five-year period — can elect to apply up to $500,000 of research credit against the employer share of Social Security tax and then Medicare tax (§41(h)). The election is made on Form 6765 with a timely filed return, extensions included — not on an amended return — and the credit is then claimed against payroll tax on Form 8974 with Form 941, starting the quarter after the return is filed. It is limited to five years.2,10
- §83(b) elections and 409A valuationsRestricted founder and early-employee stock needs a §83(b) election within 30 days of transfer; Form 15620 can be completed and submitted through an IRS online account. Option strike prices rest on a §409A valuation — an independent appraisal no more than 12 months old, or a written report for illiquid stock of a company with no business older than ten years — because a failed plan brings income inclusion, a 20% additional tax and interest (§409A(a)(1)(B)).3,4,11,12
- NOLs and ownership changesNet operating losses from years after 2017 offset no more than 80% of taxable income (§172(a)(2)). A shift of more than 50 percentage points in ownership by 5% shareholders within a three-year testing period — common after several priced rounds — caps annual NOL use at the company's value times the long-term tax-exempt rate (§382). We track the testing period with each round so the losses survive to the year they're needed.13,14
- Lenders: bad debts and dealer statusBook loan-loss allowances aren't deductible; the reserve method was repealed in 1986, so the deduction follows worthlessness or a partial charge-off (§166(a)). A lender that regularly makes loans is exempt from dealer status only while its loan sales stay negligible — fewer than 60 instruments, or less than 5% of the year's originations by basis (Treas. Reg. §1.475(c)-1(c)). Beyond that, §475 mark-to-market can apply.15,16
CFO Advisory
Board-ready numbers, every month.
Investors read a startup through a short list of ratios. We build them from a closed, reconciled ledger rather than a spreadsheet that drifts from the books.
| Metric | What it tells you | Cadence |
|---|---|---|
| Runway and 13-week cash | Months of cash at current net burn, backed by a rolling 13-week receipts-and-disbursements forecast that catches payroll and vendor timing a monthly model hides. | Weekly · Monthly |
| Burn multiple | Net burn divided by net new ARR — how much cash each dollar of new recurring revenue consumed, and the efficiency measure boards compare across rounds. | Monthly · Quarterly |
| CAC payback | Months of gross-margin-adjusted revenue needed to recover the sales and marketing cost of a new customer, tracked by channel and cohort. | Quarterly · By cohort |
| Net revenue retention | Revenue from a starting cohort after expansion, contraction and churn. Above 100% means the installed base grows without new logos. | Monthly · Trailing 12 months |
| Take rate and net revenue margin | For payments and marketplace models, revenue as a share of volume processed and margin after interchange, processor and sponsor-bank costs — presented consistently with the gross-versus-net revenue conclusion. | Monthly · By product |
| Credit performance by vintage | Delinquency roll rates, charge-offs and recoveries by origination month — the data behind loss reserves, warehouse-line covenants and the §166 charge-off file. | Monthly · By vintage |
| Gross margin by revenue stream | Hosting, support and payment costs assigned to each product, so pricing decisions and investor metrics use the same cost base. | Monthly |
| Cap table and option pool coverage | Fully diluted ownership, pool remaining against the hiring plan, and the 409A valuation date the next grants depend on. | Per round · Quarterly |
Accounting & Compliance
What we run, and who we coordinate with.
We keep the recurring filings and reconciliations in-house and work alongside the specialists a venture-backed company already relies on.
Handled by our team
- Monthly close and investor reporting — accrual books, deferred revenue and a board package that ties to the ledger
- Settlement and FBO account reconciliations — platform ledger, processor reports and bank balances matched every month
- Delaware annual report and franchise tax — recalculated under the Assumed Par Value Capital method before March 1
- R&D credit file — business components, qualified wages and contractor costs documented for Form 6765 Section G
- Form 5472 and pro forma Form 1120 — for 25% foreign-owned corporations and foreign-owned single-member LLCs
- 1099 and payroll compliance — vendor W-9s, the $2,000 reporting threshold for 2026 payments and Form 8974 with each Form 941
- Data room financials — historical statements, returns, QSBS support and cap table reconciliations
Coordinated with your specialists
- Audit firm — we prepare the schedules and reconciliations for the financial-statement audit; the audit itself is theirs
- Independent valuation firm — 409A appraisals, using our financials and forecast as inputs
- Sales tax provider such as Avalara or TaxJar — software taxability and multistate filings
- Regulatory counsel — money-transmitter and lending licenses, which we plan around but don't obtain
- Corporate and equity counsel — charter amendments, option plans and financing documents
What changed · What’s next
Dates on the startup calendar.
Recent changes and the next deadlines that affect equity, R&D and Delaware filings.
Retroactive §174A window closed
Last day for eligible small businesses to file amended 2022–2024 returns electing retroactive domestic R&E expensing under Rev. Proc. 2025-28.7
AheadQSBS dollar limits begin indexing
The $15 million per-issuer cap and the $75 million gross-assets threshold adjust for inflation for taxable years beginning after 2026.1
Ahead
Ahead
The Beaconshire Method
How an engagement runs.
Four phases, one accountable team. Tax, CFO and accounting work move together, so a decision made in one discipline is already reflected in the other two.
Phase 01
Discovery
We read the charter, cap table, financing documents and recent returns, and map payroll and contractors to product work. Within the first weeks you know where QSBS, R&D and NOL exposure sits and what it is worth.
Phase 02
Strategy
We set the positions: QSBS eligibility support, §174A and credit elections, payroll-offset timing, the Delaware tax method and the KPI set the board will see each month.
Phase 03
Implementation
We move the close to accrual, set up project and time tracking for R&D, reconcile settlement accounts, and file the elections and returns on the calendar above.
Phase 04
Stewardship
Monthly board package and 13-week cash, quarterly tax projections, and a refreshed QSBS and §382 file at every financing round.
Run the numbers first
Where this work lives
Tax Advisory & Planning
Year-round planning, entity design and multi-year projections — scoped so the savings justify the fee.
Explore advisory →Fractional CFO
Forecasts, KPI dashboards, lender and board reporting, and a monthly close review.
Explore fractional CFO →Bookkeeping
Tax-ready books and cleanup — the foundation every strategy and forecast depends on.
Explore bookkeeping →FAQ
Common questions.
Does a FinTech company qualify for QSBS?
It depends on what the company does, not what it calls itself. §1202(e)(3) excludes banking, financing, leasing, investing, financial services and brokerage, so a balance-sheet lender or an advisory platform can fail while a company selling software to those businesses may qualify. The 80% active-business test and the gross-assets ceiling also have to hold. We document the analysis at each issuance so it exists when an acquirer asks for it.
We capitalized R&E on our 2022–2024 returns. What's left to do?
The amended-return route for small businesses closed July 6, 2026. A separate catch-up election let companies deduct remaining unamortized 2022–2024 domestic costs on the 2025 return or split them over 2025 and 2026, so a company that chose the split takes the second half in 2026. Foreign research stays on its 15-year schedule. We confirm which path the 2025 return took and carry it forward correctly.
Should we use the R&D credit against payroll taxes?
If the company had less than $5 million of gross receipts for the year and no gross receipts before the five-year window, usually yes. A pre-revenue company can't use an income tax credit, but it does pay employer payroll tax. Up to $500,000 a year can be elected on Form 6765 with the timely filed return (not an amended return), the benefit starts in the quarter after filing, and the election is available for five years — so we plan which years to spend it on.
Which Delaware franchise tax method should we use?
Usually the Assumed Par Value Capital method. Startups often authorize millions of shares, and under the Authorized Shares method 10,000,000 authorized shares produce a tax of $85,165. The alternative method uses total gross assets from Form 1120 Schedule L and all issued shares, with a $400 minimum and the same $200,000 maximum. Both the report and the tax are due March 1.
Do you perform our audit or our 409A valuation?
No. We don't audit, review or compile financial statements, and the 409A appraisal safe harbor depends on an independent appraiser. We prepare the books, schedules and forecasts those engagements rely on and coordinate with the audit firm and the valuation firm so their work moves quickly.
We have a foreign founder or parent company. What changes?
A U.S. corporation that is at least 25% foreign-owned, or a foreign-owned single-member LLC, files Form 5472 for reportable transactions with related parties — the LLC attaches it to a pro forma Form 1120. Failing to file, or filing a substantially incomplete form, carries a $25,000 penalty. We keep the related-party ledger during the year so the form is a byproduct of the close.
Other industries we serve
Sources
- [1]26 U.S.C. § 1202 — Partial exclusion for gain from certain small business stock — Legal Information Institute (Cornell Law School)
- [2]26 U.S.C. § 41 — Credit for increasing research activities — Legal Information Institute (Cornell Law School)
- [3]Form 15620 — Section 83(b) Election (Rev. April 2025) — IRS
- [4]Mobile-friendly forms (online submission of Form 15620) — IRS
- [5]26 U.S.C. § 174A — Domestic research or experimental expenditures (with P.L. 119-21 § 70302 notes) — Legal Information Institute (Cornell Law School)
- [6]26 U.S.C. § 174 — Amortization of foreign research or experimental expenditures — Legal Information Institute (Cornell Law School)
- [7]Rev. Proc. 2025-28 (domestic research or experimental expenditures under § 174A) — IRS
- [8]26 U.S.C. § 280C — Certain expenses for which credits are allowable — Legal Information Institute (Cornell Law School)
- [9]IR-2025-99 — IRS extends the period for feedback on Form 6765; Section G optional for tax year 2025 — IRS
- [10]Instructions for Form 8974 — Qualified small business payroll tax credit for increasing research activities — IRS
- [11]26 C.F.R. § 1.409A-1 — Definitions and covered plans (stock valuation safe harbors) — Legal Information Institute (Cornell Law School)
- [12]26 U.S.C. § 409A — Inclusion in gross income of deferred compensation under nonqualified deferred compensation plans — Legal Information Institute (Cornell Law School)
- [13]26 U.S.C. § 172 — Net operating loss deduction — Legal Information Institute (Cornell Law School)
- [14]26 U.S.C. § 382 — Limitation on net operating loss carryforwards following ownership change — Legal Information Institute (Cornell Law School)
- [15]26 U.S.C. § 166 — Bad debts — Legal Information Institute (Cornell Law School)
- [16]26 C.F.R. § 1.475(c)-1 — Definitions; dealer in securities — Legal Information Institute (Cornell Law School)
- [17]26 U.S.C. § 6041 — Information at source (with P.L. 119-21 § 70433 notes) — Legal Information Institute (Cornell Law School)
- [18]Rev. Proc. 2025-32 (2026 inflation adjustments) — IRS
- [19]Annual Report and Tax Information — Delaware Division of Corporations
- [20]How to Calculate Franchise Taxes — Delaware Division of Corporations
- [21]Instructions for Form 1120 (2025) — IRS
Figures and deadlines verified October 23, 2026
Bring us the cap table and the last close.
We'll show you where QSBS, R&D and Delaware exposure sits and what fixing it is worth. Every project is scoped so the potential tax savings and financial clarity justify the cost of our fees — and if we don't believe the math works in your favor, we'll tell you before you engage.
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