What if you could save thousands on your taxes with a few strategic changes to your business? In this episode, Nick Romanelli and Dylan Valentyn from Clifton Larson Allen share key tax strategies that many manufacturers overlook.

We dive into the R&D tax credit, showing how manufacturers—whether small job shops or larger factories—can qualify by innovating in ways they may not have considered, such as improving products, developing new processes, or creating prototypes. By documenting these activities and tracking time and materials, manufacturers can unlock valuable credits that could significantly boost their bottom line.

We also explore the impact of the Section 174 rules, which now require manufacturers to capitalize and amortize research expenses over several years rather than expensing them immediately. While this change can affect cash flow, the R&D tax credit offers relief by providing a dollar-for-dollar reduction in tax liability. Nick and Dylan explain how to navigate these changes and ensure manufacturers are maximizing their R&D claims.

Next, we discuss the critical decision of entity selection—LLC, S Corp, or C Corp. Nick and Dylan break down the advantages and disadvantages of each structure, and how making the right choice can lower your tax burden, attract investment, and set up your business for long-term success.

Finally, we introduce the Work Opportunity Tax Credit (WOTC), a valuable but often overlooked tax benefit for manufacturers who hire employees from groups facing employment barriers, such as veterans or long-term unemployed individuals.

Tune in to discover how these tax strategies can save you money and help your manufacturing business thrive, plus a look at what tax changes to watch for in 2025.

• (0:00) Introduction to the episode and the guests
• (0:59) Depreciation strategies for IT and power infrastructure
• (02:25) The overlooked opportunity of R&D tax credits
• (04:34) Tracking R&D activities for tax credit qualification
• (10:32) The process for claiming R&D credits
• (13:51) The impact of the 174 rules on research expenses
• (17:10) Tax strategy for manufacturers considering entity selection
• (21:16) Exploring the Work Opportunity Credit
• (24:18) Tax changes to watch for in 2025

• CliftonLarsonAllen (CLA)
• Glossary of Terms

• Connect with Dylan on LinkedIn
• Connect with Nick on LinkedIn

• Follow on LinkedIn
• Connect with Mike Payne on LinkedIn

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What can you do to impact your tax liability for 2024?

With tax season right around the corner, manufacturers are faced with the crucial task of optimizing their tax strategies to both reduce liabilities and unlock future growth potential.

In part one of a two-part series, I sat down with tax experts Dylan Valentyn and Nick Romanelli from CliftonLarsonAllen (CLA) to explore the critical tax-saving opportunities that could significantly improve cash flow and business sustainability—for 2024 and beyond.

We kick off with a discussion on tax planning, particularly focusing on strategies for deferring taxes and accelerating deductions. Dylan and Nick emphasize how businesses can free up valuable cash flow through smart deferral tactics, such as depreciation, and how this can be reinvested to fuel future growth. They also dive into the importance of working closely with your accountant to ensure that tax strategies are aligned with the business’s long-term goals, especially when planning for 2025.

One of the key strategies explored is reviewing capital expenditures and utilizing powerful tax-saving tools like Section 179 deductions, bonus depreciation, and cost segregation studies. Dylan and Nick explain how these methods can offer immediate tax relief and boost cash flow—saving manufacturers substantial amounts in taxes.

Dylan and Nick also unravel common misconceptions about taxes in the manufacturing sector. They break down the importance of inventory accounting methods (FIFO vs. LIFO), offer insights into managing capital purchases, and provide guidance on how to navigate complex tax decisions that can make or break a business’s financial performance.

This episode is packed with information you can employ to make a difference right now. Don’t miss it.

STAY TUNED: In the next episode, the team will dive even deeper into advanced strategies that focus on long-term tax planning. It will be can’t-miss in-depth advice that could help unlock your business’s full financial potential.

• [2:08] Get to know Dylan Valentyn and Nick Romanelli
• [4:59] Why taxes are a misunderstood concept
• [6:48] What can you do to impact your tax liability for 2024?
• [10:49] Dissecting FIFO versus LIFO
• [15:30] Small business taxpayer exception
• [17:58] Non-incidental materials and supplies
• [19:08] Cash versus accrual accounting
• [26:02] Do contract methods matter to accounting?
• [27:53] What is a cost segregation study?

• CliftonLarsonAllen (CLA)

• Connect with Dylan on LinkedIn
• Connect with Nick on LinkedIn
• Glossary of Terms and More Resources

• Follow on LinkedIn
• Connect with Mike Payne on LinkedIn

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Many manufacturing businesses hit a plateau around $2 million in revenue, and breaking through that ceiling can feel overwhelming.

According to Paul Van Metre, it’s not just about working harder—it’s about building systems that work harder for you. In this episode, Paul, a manufacturing entrepreneur and co-founder of ProShop ERP, uncovers why so many businesses get stuck at this threshold—and how to overcome it.

We cover real-world insights on the common challenges shop owners face, from over-reliance on a single customer to wearing too many hats as the business owner. He explains why reinvesting in systems, processes, and people is essential—not just for scaling your business but for creating a better quality of life.

Whether your goal is to grow past $2 million or simply work fewer hours while maintaining profitability, Paul’s advice on lean principles, automation, and delegation will equip you with practical steps to move forward.

Tune in to learn how you can take control of your shop’s future, empower your team, and build a business that thrives—whether you’re at the helm or spending more time with your family.

• (0:00) Introducing Paul Van Metre and today’s topic
• (5:08) Why businesses cap at $2 million in revenue
• (10:48) Why reinvest revenue in systems and processes
• (13:13) The importance of hiring and delegation
• (20:52) How to break the $2 million cap
• (33:42) What can you do to make meaningful improvements?

• The E-Myth
• Built to Sell

• Connect on LinkedIn
• Machine Shop Mastery
• ProShop ERP

• Follow on LinkedIn
• Connect with Mike Payne on LinkedIn

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