Due Diligence, Tax Strategy, and Deal Structuring with Alex Lopez

In this episode of the DealQuest Podcast, I'm delighted to sit down with Alex Lopez, CPA, a Miami-based CPA whose 12-plus years at global accounting and consulting firms built the foundation for a practice now focused on CFO services, tax minimization strategy, and deal-side due diligence. Alex works primarily with entrepreneurs in professional services, tech, and real estate, helping them scale from six to seven to eight figures while keeping more of what they earn.

What makes Alex's perspective particularly sharp is that it was forged in the field before it was ever refined in a classroom. Growing up in Medellin, Colombia during the turbulent 1990s and then watching the South Florida real estate market both explode and collapse before he was out of his teens, Alex arrived at accounting by way of lived experience with boom-and-bust cycles, not theory. That background runs through everything he does when he sits across the table from a business owner thinking about their next deal.

FROM MEDELLIN TO MIAMI: AN ENTREPRENEUR'S ORIGIN STORY

Alex grew up in Medellin, Colombia during what he describes as a "brutal time" in the 1990s. But alongside the difficulty, there was construction everywhere. High-rises going up, projects being orchestrated by people he couldn't quite identify yet. "I was fascinated by the people behind those projects," he told me. That fascination with who builds things, and how, never left him.

He arrived in the United States in the summer of 1999, around what he calls the peak of Colombia's worst turmoil, when his parents sought political asylum and a better life for him and his brother. By the early 2000s, his family had gotten involved in Florida real estate. Alex was watching closely, and as soon as he could, he got his real estate license straight out of high school at eighteen.

The timing felt right. Florida was booming. Then, as he put it plainly, "we all lost our shirts." The 2008 financial crisis hit South Florida with particular force, and Alex watched not just his own situation unravel but those of his neighbors, friends, and clients. He went back to school, doubled down on a business degree, discovered he had a real knack for accounting, and eventually landed at one of the global firms. The detour through the crash turned out to be the making of him.

THE FIRST DEAL AND THE FIRST HARD LESSON

When I asked Alex about the first deal he was ever involved in, he didn't hesitate. Candy. Specifically, Cry Babies, a sour candy popular in Colombia in the 1990s. He was selling them in school and in the neighborhood, and for a while it was working. Then his business partner disappeared along with all their supplies and earnings.

"That was my first big lesson in business," he said. "Not to trust anybody." He didn't find out for years who it was, and it was heartbreaking when he did.

I pointed out that even a forensic accountant's career might have roots in something like that. There's something almost fitting about a person who spent his youth watching people hide things in plain sight going on to build a career finding exactly that. Watching the numbers. Understanding what's real and what's being obscured.

READING THE MACRO: HOW CYCLES SHAPE DEAL JUDGMENT

One of the things I appreciate about Alex is that he thinks in ratios and cycles, not just individual deals. After living through the Florida real estate collapse, he developed a real sensitivity to when markets start behaving irrationally.

"I'm a big fan of ratios and anecdotes," he told me. The ratios, in his view, usually don't lie. When valuations push outside the normal range for an industry without a clear justification for the upside, that's a signal worth heeding. He also mentioned what he attributed to Jeff Bezos: when the charts start looking extraordinary, you should start listening more carefully to what people are actually saying, because the anecdotes begin to tell you more than the numbers alone can. When deals that make no sense are getting done with enthusiasm, and people start talking as if it will never stop, "that's when you know we've crossed the line."

He was candid that, in his view, we are not far from that territory today in certain markets.

THE SCOPE OF REAL DUE DILIGENCE

Alex spent years as a financial auditor, which taught him how to develop a comprehensive understanding of a business quickly. That training shapes how he approaches deals now. "You're trained to obtain an understanding of the big picture and then the most critical areas of a business very quickly," he said, and from there, you corroborate, analyze, validate, and test.

In practice, that means financial statements, tax returns, projections, and source documents. It means digging into the legal structure of an entity, board minutes, potential litigation, demand letters, and anything that signals which direction the business is trending. It means benchmarking against the industry, not just examining the company in isolation, because a great company in a declining specialty is a very different proposition from a great company in a rising one.

The goal is to wear what he called an "auditor's hat" while keeping the big picture in view.

FINDING HIDDEN VALUE ON THE BUY SIDE

Not all of what due diligence turns up is a red flag. Sometimes it's the opposite. Alex walked me through a deal where he was on the sell side for a medical practice. The buyer was showing unusual interest despite an asking price that objectively stretched the market multiples for that specialty.

After a lot of conversation during negotiations, the picture clarified. The buyer had a narrow niche that was completely different from what Alex's client offered, and acquiring this particular practice would give them a boost that more than justified the inflated price on the seller's end. "We almost couldn't find what that was," he said. But because they stayed in the room and kept digging, they understood why the buyer was willing to stretch. And that understanding gave them the leverage to hold firm and get a very high selling price.

That's a lesson I share with my own clients on the sell side regularly. When you understand why someone wants what you have, and you understand it more clearly than they think you do, you are in a much stronger negotiating position.

WHEN THE NUMBERS TELL YOU TO WALK AWAY

Not every deal is a diamond in the rough. Alex shared a deal he worked on the buy side involving a transportation company in Florida that serves the education sector. It looked excellent on paper. He described going "real KGB" on the diligence: proof of cash, customer agreements, physical observation of assets. Everything seemed to check out.

One ratio seemed slightly off. It was related to insurance. The explanation they got was partial and convenient, and in hindsight, they were blinded by how strong everything else looked. Long story short, the seller had misrepresented the insurance situation. The real cost of adequate coverage was several times what had been represented, to the point where the deal no longer made economic sense. They had to pull out.

"You gotta do your homework. You gotta look under the hood," Alex said. A single ratio that nags at you deserves a complete answer, not a half one. That's what due diligence is for.

THE SELLER WHO NEEDED CASH FAST

Alex also shared a story from a deal where he was on the buy side and something felt off in a way that was hard to initially name. His buyer had made a competitive leveraged offer on a business. Then a cash buyer appeared, and the seller became insistent that the deal had to close in cash at a lower price.

The seller's insistence on cash over a higher leveraged offer was economically strange. It made no sense on the numbers. As Alex put it, "something was off based on the economics and the details of the deal." It turned out the seller was about to be convicted of a white collar crime and needed to get his affairs in order quickly. The cash urgency had nothing to do with preference and everything to do with timing they hadn't yet uncovered.

Court searches matter. Background checks matter. And when a seller's behavior doesn't align with what the economics would predict, that misalignment is worth treating as a signal, not noise.

TAX PLANNING STARTS BEFORE THE DEAL IS ON THE TABLE

When the conversation shifted to the tax side, Alex made a point I want every business owner who is even thinking about an eventual exit to hear: waiting until you have a deal under letter of intent before you start thinking about tax planning is too late. Often significantly too late.

One of the biggest missed opportunities he sees, particularly in small to mid-sized deals, is the qualified small business stock sale, or QSBS. This provision can allow eligible business owners to exit with little to zero tax on their capital gains, potentially on the first ten million dollars of gain and sometimes higher. The requirements include being structured as a C corporation and holding the stock for at least five years. Neither of those is achievable after you've already negotiated a deal.

Alex described a young tech founder who called his firm late last year. The deal was essentially locked and loaded. The buyer had completed diligence. They were weeks from closing. And this founder had not set up his structure in a way that allowed him to take advantage of QSBS. He paid a seven-figure tax bill because of it. "He did not know that this existed," Alex said. That was the issue. Not negligence. Just an absence of the right guidance at the right time.

STRUCTURE DECISIONS THAT COME BACK TO HAUNT YOU

QSBS is far from the only structuring issue that affects deal outcomes. The S corporation election is a good example. It makes sense in a lot of situations, particularly for the self-employment tax benefit, but it creates real complications in deal scenarios, especially when buyers are offering a mix of cash and rollover equity.

If a seller is structured as an S Corp and different shareholders want different splits of cash and equity, you cannot do it proportionally without major tax consequences. The flexibility that seemed attractive operationally becomes a rigidity at exactly the wrong moment.

Alex also flagged a recurring mistake he sees in tech: founders who avoid the C Corp structure because they don't want to lose the ability to take pass-through losses during early lean years. His point is that those losses are often smaller than people assume, and if you build a multi-million dollar company and sell it, the QSBS savings alone dwarf the deductions you passed on. As he put it, once you've exhausted your investment basis in the business, you may not be taking those losses anyway.

STRUCTURING YOUR PAYOUT TO MINIMIZE THE TAX HIT

Even when optimal pre-deal structuring wasn't done, there are still meaningful levers to pull. Alex described structured payouts, including earnouts and installment sales, as tools that serve two purposes at once. First, they spread the tax liability across multiple years, potentially at lower brackets. Second, sellers who are willing to take their payout over time can often negotiate a significantly higher total price. The expression he referenced was simple: "your price, my terms. Or the other way around."

He mentioned the installment sale trust and a few other more sophisticated strategies as additional options, but his point was that the foundation of it all is knowing what you want before you get to the table, not after. "It's not just about a number and a closing date. It's about how is that going to affect me," he said.

WHAT ALEX IS BUYING NOW

As we wrapped up, I asked Alex what he's seeing across the deals he's working on today. He was candid that he thinks valuations have generally gotten stretched and that too much hype has propped up prices in most sectors. But he's still active. He bought an accounting firm in January and is actively looking for more. He also flagged trade businesses, electrical and drone operations in particular, as areas where he's seeing strong numbers. On the drone side, he made clear he wasn't talking about photography. The real activity is in inspections, particularly for insurance and safety purposes, and the economics of those businesses are compelling.

"I planted a lemon tree a long time ago," he said. "Right now I'm making lemonade." His primary focus is on growing through accounting and consulting firm acquisitions.

FREEDOM

I close every episode of DealQuest with a question about freedom, because it's the highest value in my own life. I asked Alex what freedom means to him.

"Freedom is the ability to be oneself and at peace with one's surroundings, and just being able to do the right thing and not worry about anything else."

Tune in to the full episode to hear Alex walk through how he approaches deal-side due diligence and tax minimization strategy, including specific examples of what he's seen go right and wrong on both sides of the table.

Listen to the full episode of DealQuest Podcast Episode with Alex Lopez, CPA: [Available on all major podcast platforms]

FOR MORE ON ALEX LOPEZ, CPA: 
https://alexlopezcpa.com

FOR MORE ON COREY KUPFER
https://www.linkedin.com/in/coreykupfer/
https://www.coreykupfer.com/

Corey Kupfer is an expert strategist, negotiator, and dealmaker. He has more than 35 years of professional deal-making and negotiating experience. Corey is a successful entrepreneur, attorney, consultant, author, and professional speaker. He is deeply passionate about deal-driven growth. He is also the creator and host of the DealQuest Podcast.

Get deal-ready with the DealQuest Podcast with Corey Kupfer, where like-minded entrepreneurs and business leaders converge, share insights and challenges, and success stories. Equip yourself with the tools, resources, and support necessary to navigate the complex yet rewarding world of dealmaking. Dive into the world of deal-driven growth today!