014: Costly Information Our CPA’s (even the elite one’s) Haven’t Told Us – Alex Sonkin

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Alex Sonkin 0:00 We are not recreating the wheel. We’re doing exactly what Amazon and Netflix did with their independent peer review, but we’re applying that model to the biggest industry in the world, the money industry. Tony Maree Torrey 0:41 Welcome to the Legacy in the Making Show. I’m your host LA’s foremost Success Coach Tony Maree Torrey, I interview leaders and influencers who have gone beyond the superficial markers of success and claimed true fulfillment by leveraging their positions to create positive and profitable changes in their businesses and beyond. They share their stories and offer real-world boots on the ground experience. That translates into practical advice to apply to your own journey. I invite you to this injection of wisdom and inspiration so you can prevail and leave your own legacy. Have you ever wondered if your tax financial legal advisors are really caught up with a complex multi 1000 page long tax code, and all the other laws that impact your financial well being? Are they actually recommending the best strategies for you, your business and your financial security, you have a right to be concerned, too many of us are relying upon the advice of professionals who through no fault of their own just can’t possibly keep up with all the complexities, the pitfalls and the opportunities associated with this environment. It’s a huge problem. And it’s a problem that today’s guest on the legacy in the making show has solved. So listen up, I promise we won’t be talking Texas the whole time, as Alex Sonken has a great story and some amazing life and leadership principles to share as well. Alex has found a way to leverage technology community and independent peer review, to make sure that the financial professionals that we know and love, have fast, efficient access to best in class, vetted experts in tax, finance and law so that they can create smart strategies for you. And extraordinary results. You’ll want to know about this, as it may help you pick your next CPA, financial advisor or legal counsel or help your current one to do a better job for you. Alex, welcome to the show. You’re super successful now. And you’re doing amazing things in the world and making a really positive difference for so many people. It’s such a trickle down effect what you’ve created in the world. But I’d love to start a little bit with your backstory you’ve shared with me things weren’t always coming up roses. Tell us a little bit about how it is that you came to do what it is that you’re doing in the world today. Alex Sonkin 3:01 Well, Tony, thank you so much for that very kind introduction. There’s you I think you said a lot of things maybe maybe hyped me up too much. So I have a lot of work to do to maybe just to just to meet that standard. But I I come from humble beginnings. My parents were very hard working, they came to this country, greatest country in the world in 1979. With like, $270, I was seven years old. So we can quickly do some math. And there I think I’m not like 150 years old by now. Tony Maree Torrey 3:31 At least in wisdom, right? Alex Sonkin 3:33 I don’t know about that. But you know, I watched my parents work really, really hard. They came here, they had to learn a new language, they had to assimilate into a new culture. But they came here to work really, really hard. And that’s what I saw when I was when I was young, is just too hard working engineers trying to figure things out. And they started a sales business where they had to build a sales organization with their broken accents. To me, that’s America, immigrants coming here, rolling up their sleeves, working hard, making a better life for themselves, and then ultimately trying to make a better life for their children, which is, which is really the sacrifice my parents made for me to bring me here. So as I grew up, I had to work hard in school and do all these things because I felt like I owed it to my parents, too, because they had certain expectations of me. So I’m an options trader. I thought that was really cool. I met a beautiful girl named Yola, she was a school teacher came up with this idea based on a diet that had cured cancer from my aunt and also introduced it to my wife’s mom, which she used to help her get very healthy because she had breast cancer. And long story short came up with this idea based on a diet that was very helpful in curing cancer, my mother in law and my and my aunt, based on a macrobiotic diet that we were introduced to at the time about 25 years ago. Tony Maree Torrey 4:57 I am showing a Go Macro bar because I eat them. They’re amazing. So does my whole family Alex Sonkin 5:03 I give them out. So I give them out to people. And it’s like people try them, they get addicted to them, and then it’s over, then they get mad at me because all they’re doing is buying macro bars that ever happened. You know, my wife now runs Go Macro, my wife and her mom built that company, it was one of very few times that my wife actually listened to advice that I gave her, which may be par for the course for married couples out there, honey, these are really good you get, you should sell the there’s got to be a huge market for people who want to eat delicious food that doesn’t cause cancer, macro bars have all the certifications. And the idea there was very simple, people want to eat delicious food and not die of debilitating disease. And apparently, the big food companies cannot deliver on that on that promise or that goal. So it took a little company called go macro to grow and become this amazing company sold all around the world. I think we’re sold like 26,000 locations now. And watching my wife was a school teacher, running this company with 180 employees with a 40,000 square foot facility. And it’s just, it’s incredible to be a part of that, and very proud of watching my wife grow into this incredibly successful business owner. Tony Maree Torrey 6:17 I love what you’re sharing there, Alex, because really, this is such a great example of something that started out as a problem, even a crisis, a health crisis for your od M for your mother in law as well, they both had it was health crises. And this is what a major component of solving that problem. Alex Sonkin 6:40 I just see patterns, I was an options trader. So when you’re when you’re a financial trader, your job is to identify patterns, because those patterns end up repeating themselves. Or sometimes it’s a small pattern that becomes a big pattern. That pattern back there was just was based on Hey, we thought that doctors and big food companies really knew what they were doing. And the closer we started to look at it, the more we realized, wait a minute, they might not know everything. Or they might be they might not have access to all the information, or there was pockets of information that were not shared. It was nope independent peer review that. So this was kind of our first my first experience 25 years ago looking into something and realizing Wait a minute, this entire group of highly skilled professionals that supposedly know what they’re doing may not know what they’re doing. And so I kind of left it there, there was a big transition between that point and we working with elite CPAs and building this community over 500 CPA firms and family offices. And a lot happened between then and now where I got, I suppose to the issues facing CPA firms. We’ll talk about the tax code, how many pages are in the tax code, nobody knows how many pages in the tax code. Tony Maree Torrey 7:56 There was literally wasn’t an answer. Other than that they know there are 1000s, and 1000s. Tony Maree Torrey 8:03 It’s changing to right? Alex Sonkin 8:04 It’s changing constantly. We just added the cares act this year in 2020. For people listening, it’s 2020. We added the cares act, how many pages are in the cares act? Nobody knows how often do they change the cares act? Nobody knows. They’re changing the Cares Act every week, sometimes multiple times a week. So they’re going to be changing the law all year. And then tax planning is going to have to be done based on the final law changes. Ask your CPA Do you know the tax code? The answer should be no, I don’t that should be the honest that nobody knows the tax code. What’s shocking to me when I first found this was 82% of the most profitable companies in the world. So more than four out of five of the most profitable companies in the world, who are obviously doing a lot of things right. And they’re winning in a lot of areas. When you look at their area of sophisticated tax planning, they are getting killed, they’re losing. They’re like awful at it. So they’re really, really good at like all these other areas of their business. But when it comes to specific tax planning, they are awful at it, but their team of tax experts, you know what they’re really good at traditional basic tax planning. Tony Maree Torrey 9:20 There are two things that I’m picking up on that I think are really key. And one of them is this theme. This thread that you have experienced throughout your professional life in this recognition of patterns. And recognizing that one of the core patterns is that even the most highly trained professionals in whatever area it is, whether it’s health, whether it’s taxes, whether it’s financial advising or legal. They just as individuals, they just cannot handle all the information out there. And I’m figuring We’re gonna be hearing from you about how it is that some of the bigger companies are so effective at curating that information so they can take the best advantage. And they also would love to hear you talking Alex, about how this affects smaller businesses as well, a lot of the people that are listening in our founding CEOs of enterprises, up to $10 million. And so I really would love to hear you talk about how that impacts them as well, Alex Sonkin 10:30 every one of those business owners, whether they’ve created a $10 million business or a $1 million business, $100 million business or $100 billion business, okay? You create a billion dollar business, it’s a very difficult thing to do, right, a consistent business like that, you find the best of the best in any area, Tony, right, the most successful business owners that you interview, if you look at what made them successful, they were not following the crowd of doing what everyone else is doing. That is what basic looks like. successful business owners are not basic, they’ve gone beyond basic, they’ve gone somewhere where their passion is push them beyond. So when we’re talking about your business owner, when they go to their CPA, who doesn’t know how many page they’re in the tax code, who doesn’t know the tax code, and doesn’t have time or know, by the way, where do we find the best tax attorneys in the world? Where Where do we find them? You asked me how diesels found the best tax turns in the world. I don’t know. I know that I know that how we created the system. These This is not one of my clients. So I don’t know exactly what he’s doing. I know the strategies he’s using, okay. And I know the system that consistently works to build the kind of team that Bezos has. And that’s exactly what we’re doing. I mean, we have a community now of over 550, elite CPA firms and family offices, we just partner with a group that has over 2300 family offices, we’re meeting them one by one and comparing notes. What that means is, we’re comparing notes with leaders of family offices with leaders of CPA firms and multi-family offices, they’re dealing with multi-billionaire clients, clients worth millions of dollars, hundreds of millions of dollars. And we are now refining our due diligence process. We are not recreating the wheel, we’re doing exactly what Amazon and Netflix did with their independent peer review. But we’re applying that model to the biggest industry in the world, the money industry, Tony Maree Torrey 12:30 I actually just recently interviewed Jim McAfee, who is one of the founders of square payment systems. And he’s written a book called The innovation stack. And one of the things that he talks about is finding these problems, these essentially kind of unsolvable problems in the traditional sense, and implementing solutions to not just one problem, but multiple layers of problems, and creating what he calls an innovation stack. And when I looked at your business model, and the things that you’re doing, I thought, Oh, well, Alex has actually created an innovation stack. He’s looked at this one problem. And he’s he’s applied solutions to all these different layers, and areas. And that’s one of the reasons why I wanted to talk to you because it’s so fascinating to me. What’s interesting is we were not seeking Alex Sonkin 13:21 the thing that we found that we think is the most valuable part of the due diligence project, the virtual family office helped the business that we created. We weren’t building that we were building something else. Okay, we were building a community of experts and resources. And we were finding these resources through the independent network. And the goal is to bring all these people into a place and have CPAs, access all this knowledge and create education, from these amazing attorneys amazing resources, all these best in class in all these different areas of Cisco tax planning, and allow our CPAs to find those resources because we were like, they can’t find these people. They don’t know where they are, because the tax attorneys are not allowed to solicit mark their tax planning strategies, so we can’t find them. So in a CPA is Miss asked to do so much. they’re asked to produce so much work in so little time with so many deadlines, they are being attacked, their time is being taken. And they don’t have the time or the resources to go and find the solutions and bring them to their clients. So we’re like we’re gonna bring a solution to the CPAs. But what we didn’t realize was, that was part of it. And that’s not the most important part. What was the most important part was the community and being together and accessing the notes on each strategy, and then being able to ask your questions. And at the end of the day, what we realized what we were creating was really a due diligence community. And what I mean by that is, Netflix is incredibly useful because instead of going and driving to 1000 Different blockbusters and talking to the guy behind the desk and the people in the aisles and going, have you ever seen this movies? It’s a good movie, do you think my wife and I would enjoy this movie? I don’t know. Let’s look at this cover. Let’s read this cover and see the back of the cover. This is a traditional tax planning is done. When you have a problem, you call your CPA, your CPAs basically going to blockbuster and he’s like, Well, does the defined benefit thing work and work here two more employees is the scope? Well, I’m going to look at my four basic strategies that I know they’re not going to work. And I’m just going to tell the client to pay the tax because anything beyond these four strategies that I know is got to be really risky, and it’s going to create Tax Court and audit risk. And that’s what I’m going to tell my client, that’s what some CPAs deal with. That’s what some attorneys do, or advisors do, if I don’t understand it. And I’m so smart. If I don’t understand it must be risky, Tony Maree Torrey 15:49 that whole risk aversion component, like no one wants things to be risky. So I think what you guys do very effectively, it’s not that you are coming up with innovative strategies, but there are strategies that are still low risk, because they’ve been researched. They’ve been understood they’ve been road-tested. Am I understanding correctly? Yeah. Well, here’s Alex Sonkin 16:13 the thing. Everyone is providing feedback, and we look at so many different components of risk, what’s going to is there going to be an audit is going to be Tax Court, what risk is there, where’s the IRS can attack, what’s the weakness of the strategy, we take a strategy, we we go into the deep, deep waters, and we go down, and we take the strategy down, down, down. Now who gets to look at this strategy and vote and tell us if it’s risky or not. Those are tax CPAs. And tax attorneys who have at least 10,000 hours of experience, dealing in cases dealing in engagements, where there was some sophistication going on have some kind of foundation in this world where they can look at something and not just pull stuff out of thin air, the people who are working for the biggest CPA firms on the planet are typically w two employees, okay. And the challenge is when you have a big firm like that, roll out a strategy. And let’s say there’s 3040 CPAs, who work at that firm who are really bright, and they might have questions about that strategy. But maybe there’s risk here, maybe this is going to get us in trouble. Those people do not want to ask those questions, they don’t want to raise their hands because they might get fired because they are now potentially ruffling the feathers creating ego based situations in that firm. So in our community, we only allow these very conservative CPAs tax attorneys who have 10,000 hours experience or more some, some have 100,000 hours experience their former big four big six CPA superstars, they’ve left those firms, they formed smaller firms, they’re now independent, we want those independent opinions of those peer reviewing masters. Tony Maree Torrey 18:00 It sounds to me that essentially what you’re doing is you are solving the problem that so many of us have facing in business and without personal income taxes is that we just really don’t know what the right thing is to do. And our experts don’t really know which strategies are safe to execute on, and which ones are not. So you’ve created this collective brain trust to really make it possible for the experts that we rely on to have access to the most up to date information. So they can really wisely recommend the best strategy for us. I work with a lot of financial advisors and I have become really familiar with the fact that our financial future can absolutely be impacted by the amount of tax we pay. Even people who have done a great job of accumulating wealth towards the end of their life, if they don’t really understand what’s going on with regard to the taxes that can have a massive impact on their retirement years. Alex Sonkin 19:07 I mean, the tax planning space is where we see the largest ROI return on investment in the marketplace right now. And it’s been that way for a long if I invest a couple $100,000. And this independent peer-reviewing community that might see plugged into is going to save me $5 million in tax and put me in a structure where I can now invest in a 99% tax restructure moving forward and my cost is a couple $100,000 or even a million dollars, whatever it is, what’s the ROI on that? Well, there’s an immediate ROI because let’s just say the cost is a half a million dollars and I’m getting an immediate benefit of $5 million. What’s that’s 1,000% ROI right off the bat. So now my financial advisor helps me manage that money inside of a 99% tax. restructuring, he just achieves some kind of positive returns over time, that 1,000% return there might turn into a 2,000% return over time, because now we’re managing money that was not going to be wasted state and federal taxes, that level of confidence is incredible. And that’s where we’re going to reduce the risk. And then the results are going to happen when they’re going to happen this year. If we do this plan, we don’t pay this tax, that money is sitting in my bank account. So to me, investing in tax planning is like the biggest no brainer in the world, once you know what you’re doing once when you when you’re doing in a way where you can really gauge risk. And the way we gauge risk is by asking independent tax planning masters, what they think about a strategy and getting their questions answered. That’s how we learn. So when we deal with sophisticated tax planning, the client always they want the benefits. They’re like, this is awesome. This is a no brainer, but I don’t understand the risk. I need my trusted tax advisor to tell me if this is good or not, if I’m going to jail on that, right? Because Unknown Speaker 21:09 that is a concern. Alex Sonkin 21:11 Right? Nobody wants that. Right. So with go macro, nobody will eat delicious food, we don’t want to die, right? We don’t want to go to jail. We don’t want to pay taxes. But Tony Maree Torrey 21:19 I want to change gears a little bit. Now just to talk about you, as a leader, you have got a lot going on in your world. And you’re very energized, you’re motivated, you’re driven, you’re excited. What are the things that you do? What are some practical hints that you can share with other people who are looking to sustain their energy sustain their excitement for their businesses, especially at the moment times of difficult for a lot. So what are the things that you do from a mindset perspective, obviously, from a health perspective, you’ve really got your finger on the pulse there, share some of your practical real-world experience around that. Alex Sonkin 22:00 I coach, a little flag football team, I coach my CPAs. At the end of the day, I’m a coach, I’m a part of teams, I’m not a one-man show, I really like to be in a coaching supportive role. In fact, I don’t want to be in front I want to be, I want to be leading, but I want to be leading in a supportive role. I want to push people up and watch them succeed my wife, it’s fun to see her succeed, it’s fun to see CPAs, who been disrespected by their high net worth clients start to command more respect and bring more love more value to the table and command more respect from their clients and provide more leadership to this client. That takes a lot of coaching. So my thing is this, I just go, go make mistakes, go work hard. Go make mistakes, go fail as much as you can. Because it doesn’t matter. The more failures you have, the more things you try, the more you learn. I just was dumb when I was young, and I just thought it was good at everything. And I’m just going 100 miles an hour into every, any one of these areas. And I’m just going, I could probably do that. I could probably do that. I could probably do that. And I was probably dumb enough to think that I could but I probably couldn’t. But I learned so much. Just diving in. The fear of failure, for some reason, was never an issue for me. I have a fear of failure, but my way of attacking it is just with action. Like to me sitting back and doing nothing. I’m going to fail. So I’m going to take action in those areas. And as I’ve gotten older, I’ve realized, you know, you just have to wait, wait, listen, listen to the right voice. Listen to your gut. God’s voice is a soft, nurturing, quiet, confident voice. It’s not a fearful, worried nervous voice. That is, that is not the voice you want to listen to. You want to listen to that calm. And sometimes all you can hear is that nervous, worried voice that’s okay. When you’re in that space, you know, if you’re scared or nervous, you’re just not in the right space to do work, right that moment. And that’s just a sign that says, You know what, let’s reconnect, let’s get in a quiet space. We’re probably believing a lot of things that aren’t true. I recognize that there are things that people believe that are simply not true. And we’re going to go find the truth and maybe share that truth so let’s Go Macro sharing this truth of you can eat healthy delicious food and not die of cancer, okay, that’s and you don’t have to go to the doctor to fix it. You just cleanse yourself with a healthy diet and exercise and all those things. So there’s a lot of truth out there. And so people believe all these things, like they’re not going to be successful, all sorts of things and they’re just not true. My advice to business is just go out there. What you have nothing to lose. You have nothing to lose. So go out there and try a bunch have stuff and fail, who cares? One of the things people worried about is what other people think. It’s taken me a long time. But and I don’t know if it’s a good thing or a negative thing, I really don’t care. I don’t care what anyone thinks, I care what God thinks, whether I like it or not, I care what my wife thinks. Happy wife happy life, but not worrying about what anyone else thinks. Because guess what, every person on the planet right now is going to be dead in 120 years, it does not matter what they think Tony Maree Torrey 25:28 one of the things that I’ve used over the years when I have gotten stuck in some cycle of fearful thinking is I just got to think of the dinosaurs. This problem is so infinitesimally small, when you think of the entire history of the planet, what I hear reading between the lines of what you’re saying is that you don’t stay stuck in any of the negative disempowering emotions for very long, it’s not that you don’t feel them, it’s not like you’re gonna go full steam ahead. And then sometimes it sounds like you do wrap your head against a brick wall, but you pick yourself up, you look at that, you take the key learnings from that you take the time to pause and reflect and get really centered. And then it’s full steam ahead again, Alex Sonkin 26:19 I can tell you firsthand, every person in the world is dealing with depression, anxiety, stress, it’s off the charts. And it doesn’t matter how much money they have, it doesn’t matter how much success they have, it doesn’t matter what their life looks like. All of that is totally meaningless work. Every single person on this planet is dealing with a massive amount of stress, anxiety, depression, all of it, the faster we learn how to process that and realize that most of that stuff is nonsense. It’s a lie. It’s a lie. It’s Think of it this way, it’s you’re drowning in two feet of water, just stand up. That’s really what it is. Stand up and start, stop worming down there. Like just stand up, get up and go. Like, that’s really what’s going on. And we can choose and be like, you know, it kind of like when we’re in bed in the morning, we’ve got all these thoughts and you’re like, Oh, God, you know, just get out of bed and go have a cup of coffee, let’s rock and roll. Don’t stay in bed and sit there a puddle. If you leave that puddle long enough, it’s just gonna get dirty and nasty and exciting. You see that river flowing down that it’s clean and fresh, just keep moving, keep moving forward, good things happen. And when these negative thoughts come in, this is the enemy. This is the other football team, right? You need to realize you need this is the battle. The battle is right between the years right here. And once you win that battle, that’s it’s the easiest thing in the world to take over. But if you don’t win that battle, it’s over. Then nothing else is possible. Tony Maree Torrey 27:59 And I work with people from actually a variety of walks of life, but primarily people in the financial services industry, and then founding CEOs. And invariably, most of the work that we’re really doing is what I call the under the hood work. It is the you know, the between the ears, and one of the things that I coach my people on is that if you are finding yourself for more than a few seconds being hijacked by an emotion, then that means that you have shifted into one of your psychological saboteur activities. And it’s time for you to do some practices and activities that they can implement very quickly and easily throughout the course of the day. Because so many of us we spend the hour or whatever in the morning doing our various practices and stuff like that, and then leave that space. And it’s very hard to bring that forth into the activities of the day and something happens that triggers us there’s a disappointment, there’s a misunderstanding, whatever. And so part of what I teach my people is these practices that they can pull in, in the moment that just take a few seconds to get them back out of that kind of being hijacked place into that centered, grounded place where they can hear their higher guidance and their deeper wisdom. And that allows them to move forward. And it sounds like you’ve got some great ways to do that yourself. What’s one of your favorite ways of stepping into that listening place. Alex Sonkin 29:25 I have this leverage relationship with my Creator. And my job is just to do the right thing. And if I screw up, he forgives me. So that’s really amazing. So now I’m free to go attack my relationships to do whatever I want in life in a completely free way. That if I screw up, who cares? Tony Maree Torrey 29:44 It sounds like you’ve really done a great job of letting go of investment in the outcome. And one of the things that I tell myself frequently is that circumstances are neutral. every circumstance is neutral and it’s only the thoughts and the stories that we tell ourselves. about those circumstances that can help us either suffer or grow and evolve. Alex Sonkin 30:08 We need a certain amount of money to survive, okay, we need it. We need a certain amount of research, we need food shelter when you basic things. Beyond that the joy that people experience is in the work, the joy is bringing joy to other people, the joy is doing what you’re good at the joy is making a difference in people’s lives, just making money buying things off. But there’s really no joy and satisfaction in any of that. So making money means that I’m on the right track that we’re doing things right, the processes working, that means we can do things we can donate money to various charities and all these different things. When we don’t make money. It’s just saying, you know what the prophets look at the process, you know, I don’t have a faulty process. I want to keep improving the process so but basing my happiness and sadness on results, there’s no First of all, the result, good results are not going to make you happy. And bad results shouldn’t make you sad. That’s the lie. That’s the world trying to pull you in to this good bad scenario, which just leads to misery doesn’t work. We are Tony Maree Torrey 31:08 running out of time now Alex. And so what I would love for you to share right now is a couple things, firstly, where people can find you and tell people about the due diligence project. And I’d also love for you to share with people how they can identify for themselves. a CPA that is involved in your community, in case they want to hire someone that has access to the amazing information due diligence, Alex Sonkin 31:36 project calm due diligence, project calm, visit us info at due diligence, project comm if you love your CPA, introduce them to us, we will meet them, we will take them through our system, answer their questions and give them access to all this information. So that you can pick and help affect your taxes and create a much better future for you and your family. If you want a new CPA relationship, again, due diligence project comm we have a whole network of trained CPA firms, family offices all around the country, resources for them best in class attorneys specialists in every area, our communities have been introducing all these independent, independent resources to us. And we’ve been vetting them out and organizing them and ranking them raising their strategies, ranking them by personality by just by how our community thinks of them, just like Amazon and Netflix does. So we’ve got the structure set up for you or your CPA, we’re here to help. Tony, thank you so much for having me on your show. Tony Maree Torrey 32:39 It’s been a joy, Alex, really lovely to get to know you more. Thank you so much for your time, Alex, I’m really just looking forward to further conversations with you, your community, and your beautiful wife if possible. Alex Sonkin 32:50 So much, Tony, I really appreciate you. Tony Maree Torrey 32:50 I’m glad you tuned in to the legacy in the making show. If you’re genuinely interested in creating positive change in your business or your life or on a more global scale, I invite you to connect with me at Tonymaree.com. That’s Tony with a Y Maree with two E’s. When you get there you’ll find the path to purpose master plan, the truly brilliant method to make sure you’re clear on why you’re here. This is the absolute critical foundation to honing your instincts and leaving a legacy you’ll be proud of. You can also find out about the Innate Wisdom Business Council which is an opportunity to evolve your vision in the company of like-minded leaders and much much more. Thanks for listening. Remember to subscribe to the podcast and we’ll see you next time